By: Tony van Niekerk, Editor COVER magazine
The 24th African Reinsurance Forum, hosted by the Tunisian insurance industry kicked off in Tunis on Sunday, with a cocktail function offered by the Insurance Regulatory Authority of Tunisia.
On Monday morning, Mr Habib Ben Hassine, President of the local organizing committee, Mrs Delphine Traorè, President of the AIO and Mr Ridha Chalghoum, Minister of Finance, welcomed guests to Tunis and the forum.
In the first session, Overview of Global Reinsurance Trends, we heard thoughts from an international reinsurer, a regional reinsurer and an international broker.
Mr Hachicha (SCOR) kicked off by emphasizing that reinsurance is an important part of the wellbeing of the continent. He explored a few trends such as the impact of low interest rates, the fact that reinsurers have not been able to earn their cost of capital and that the positive loss reserves of the past few years are declining. He ended off by looking at the risks posed by political instability and regulatory/legislative changes. Comments to his presentation included the fact that the emergence of alternative sources of reinsurance brought a positive boost to reinsurance capital, but could also have been the cause of a flattening of the cycle
Mr Diaw, Sen Re, have a regional perspective, stating that 35 reinsurers are operating on the continent, with the numbers having increased. He mentioned that premiums have increased by 10% while globally it only increased by 3%, highlighting the important of the region for local and international players, with average session being 3 x that of the international average. He also stated that skills shortages are still a big challenge.
A positive development is that many new local reinsurance players have started, supported by local capital, which keeps costs down.
Mr Dobecq, Guy Carpenter, stated that 2017 was the worst loss year on record, with 2018 being the 4th worst but that that he thinks reinsurers will have a good year in 2019.
He then went on to explore the drivers of the reinsurance market:
⁃ Capital, with dedicated reinsurance capital growth declining
⁃ On CAT losses he mentioned that CAT driven losses were short lived
⁃ Mergers & Acquisitions
⁃ Taxes and Regulation
Andreas Bollmann, Dr Schantz, Alms and Company then introduced the 4th edition of the AFRICA Reinsurance Pulse. Take a look at this article for some interesting findings from their research.
All in all we had a great start to day one.