Time for reform

In Libya, the year 2004 has been characterized by the creation of two new private companies to be added to United Insurance. This new trend of sector liberalization, however limited to the Libyan investors, is likely to gather momentum in the future. Such process will certainly trigger further opening of the market to competition.

In Tunisia, two big issues are dominating the scene. The 2005 reforms will mainly target the motor and health classes whose performances are nowhere near satisfactory to both the authorities and the insurers.

In the motor business, the introducing of a disability percentage table should contribute to a remarkable improvement of the class's outcome and to the reduction of the deficits reported in recent years.

In the health class, the creation of a national insurance fund will discharge companies from the cumbersome risk which they were unable to balance. In the new system, insurers will no longer have to intervene from ground up, but only as a supplement to a basic regime wholly taken in charge by the new fund.

As far as Algeria is concerned, the year 2005 stands for reforms. The delays accumulated in the course of the last two decades require the adoption of drastically radical measures in order to upgrade a loss-making market. The main sectors regard:

• Relaunching the life class which has become almost extinct
• Consolidating the financial solidity of companies
• The privatization of public insurance firms
• Management techniques of state owned firms

In comparison with its neighbours, the Moroccan market seems to be the one that has progressed best. In a few years, the scene has been totally remodelled. More than half the companies operating in 1990 have disappeared from the 2005 market. By way of merger and acquisition, large national groups have emerged. Bancassurance has managed to impose its presence and acquire a big share of the market. Finally, a new insurance code has seen the day in 2004, confirming this mutation.

Attention will focus, in 2005, on the creation of a health insurance system, and on the insurance distribution network. Nonetheless, the spotlights will be stolen by the lingering series of mergers and acquisitions with AXA's position on the market, and the short-term evolution of CNIA case.