African reinsurance market remains promising

The trend consists in particular in imposing a mandatory cession on insurers for the benefit of national reinsurers with the objective of limiting foreign currency exit abroad.

Despite this policy, large-scale risk retention level remains insignificant due to the poor capacity of regional players and to the lack of expertise in the areas of underwriting and major risks management.

The rating agency has also underscored the positive evolution reported by the African reinsurance market during the last decade, a trend that has slowed down in the recent twelve months as a result to degrading economic situation and decline in demand for oil and gas.

Despite growing protectionist measures and slowdown in growth pace, the African market remains attractive. Low loss experience coupled with market growth perspectives are enough assets to push foreign investors to set foot on the continent.