Despite the challenges in Africa, experts believe that Africa’s insurance and reinsurance markets offer potential for growth.

According to a report by A.M Best Rating Company, insurance penetration in Africa is growing, but from a very low base, but in certain countries, given the economic development in the region.

The report stated that each country has different drivers for heightened insurance demand, ranging from economies dominated by the oil and gas and mining industries, to large populations.

Accordingly, insurance market growth in recent years has also been characterised by an increase in the number of direct partnerships between businesses in Africa with others internationally.

The report stated, “There has been an increasing interest in international insurer financial strength ratings, with the need for insurers and reinsurers to demonstrate solid underwriting and overall sound financials as a key aspect of the sector’s development. The benchmarking a company’s financial strength against competitors in other international domiciles is increasingly an aspect of this continent’s insurance development, in the same way as it has become a feature of other global insurance markets.”