Algeria: Sonatrach expands its activities into the personal insurance market
The Algerian national oil and gas company (Sonatrach) is about to launch – through one of its subsidiaries called "Cash" - a personal insurance company.The Algerian national oil and gas company (Sonatrach) is about to launch – through one of its subsidiaries called "Cash" - a personal insurance company.
Created this year, the new entity will partly be owned by Algerian partners (Cash and the National Bank of Algeria own 57.5 per cent), La Presse newspaper reports. At first, "Cash" will use the Sonatrach and BNA networks.
According to forecasts by the Algerian Union of Insurers (UAR), the market for life insurance could reach 50 billion dinars (€482 million) over the next decade, which represents half of the expected global market, which should reach 100 billion dinars, according to the UAR.
Credit rating agency Standard & Poor's (S&P) has also published a report in 2012 forecasting long-term growth for insurers in the Maghreb region of North Africa.
"Markets are likely to advance on the back of mounting needs for life and savings products and demand for personal lines of business, like home property and health, which remain either untapped or underdeveloped. In addition, developing infrastructure and government efforts to increase insurance penetration are likely to support premium volumes in the coming years," says the rating agency.
Algeria has the biggest growth potential given that the penetration rate of insurance is still low at 0.8 per cent of the Gross Domestic Product.
S&P also believes bank insurance growth will boost the country's sector in the coming years.