The insurance market in the Maghreb (Part 1)

Atlas Magazine proposes to its readers a special Maghreb coverage due to be published in two parts. This issue is dedicated to the general context of insurance in the Maghreb and to the historical background of the Algerian, Moroccan and Tunisian markets. The December 2012 issue will depict the current structure of each country and the performances achieved.
Algiers centre. Seafront © Sandervalya,CC BY-SA 3.0

General context

Status of the Maghreb insurance sector

The cumulated turnover of the three central Maghreb countries (Tunisia, Algeria, Morocco) are estimated at 4.8 billion USD in 2011. This amount accounts for a substantial share of the African market, that is, 7.2% of the overall collections achieved on the continent (31%), South Africa being excluded. At the global level, premiums collection in the Maghreb remains negligible, accounting for only 0.1% of the business underwritten worldwide.

According to the last ranking established by the magazine Sigma, the Moroccan, Algerian and Tunisian markets are respectively standing in the 53rd, 64th and 77th positions. Morocco is, nonetheless, the second African market, far behind South Africa.

Life and non life premiums in 2011
in millions USD
America1480 165
North America
- 1325 890
United States
11204 677
Other countries
-121 213
South America
- 154 275
1478 287
2822 231
3512 846
Other countries
-40 911
Europe1650 866
Great Britain
3319 553
4273 112
5245 162
Other countries
-813 039
Asia1298 139
2655 408
6221 858
South Korea
8130 383
Other countries
-290 490
Africa68 080
South Africa
1752 376
532 859
581 714
641 201
Other countries
-9 118
Oceania99 438
-89 086
Other countries
-10 352
Total4596 688
Source: Sigma, Swiss Re
1. Penetration rate

Penetration rate stands for the share of insurance in a country’s gross domestic product.

With respective penetration rates of 2.9%, 1.8% and 0.7%, Morocco, Tunisia and Algeria are standing beyond the fiftieth rank worldwide. The average of the African continent remains much higher than the figures mentioned above with 3.62% for life and non-life insurance combined, that is, 2.46% for life and 1.16% for non-life business. It is South Africa, Namibia, Mauritius and Kenya which are pulling these rates. By comparison, insurance penetration rate worldwide amounts to 6.6% (3.77% in life and 2.83% in non-life).

Penetration rate in 2011
 RankingTotal in %Life in %Non life in %
South Africa
Great Britain
United States
Mauritius Island
United Arab Emirates
Source: Sigma, Swiss Re
2. Insurance density

Insurance density indicates the sums annually disbursed by each inhabitant to insurance.

Insurance density in Morocco and Tunisia are slightly above the African average set at 65.2 USD per capita (44.3 USD in life and 20.9 USD in non-life). These figures remain, nevertheless, insufficient in comparison with the insurance density at the global level which amounts to 661 USD per capita (377.7 USD in life and 283.2 USD in non-life).

The analysis of the insurance penetration rate shows that in the three Maghreb countries, life insurance is less developed than non-life whereas in Africa and around the world, it is the other way round.

Insurance density in 2011, premium per capita in USD
 RankingTotalLifeNon life
18 0124 4213 591
26 6471 8704 777
35 9743 7482 226
55 1694 1381 031
Great Britain
74 5353 3471 188
124 0412 6381 403
United States
143 8461 7162 130
173 3712 757614
192 9671 3891 578
United Arab Emirates
301 3812551 126
South Africa
321 038823215
Mauritius Island
African average
- 65.2 44.3 20.9
World average
Source: Sigma, Swiss Re

The Birth of insurance in the Maghreb

A historical overview on insurance in Algeria

Algiers harbour © Lostastos, CC BY-SA 3.0

The first signs of insurance activity appeared in 1845 when the French company Union Incendie (Fire Union) opened an agency in Algiers. Ever since, other companies started gradually to get established in order to meet the needs of the first settlers. It is only a century later, beginning from 1950, that the sector started to develop seriously thanks to the introduction of the compulsory workmen’s compensation insurance. In 1958, the compulsory motor insurance came to boost the market’s turnover.

Until the country’s independence in 1962, the local market remained totally dependent on the French market. All French and foreign companies established on the Algerian soil were governed by French legislation.

Shortly before 1962, motor insurance became prominent, accounting along with workmen’s compensation plans for 65% of the total premiums. The fire class accounts for only 8% of the overall market premiums, and only simple risks are insured. In 1961, industrial risks were insignificant. Due to the importance of the Mutualité Agricole, one of the first actors emerging on the market, miscellaneous accident insurance was then dominated by hail.

Upon the country’s independence in 1962, the Algerian legislator reproduced all the texts in force pending the enactment of new laws. By then, Algeria counted 160 certified insurance companies, half of which were French. The companies’ branches and agencies are mainly established in large urban centers: Algiers, Oran and Constantine.

The 1962-1995 period was marked by three major events: market nationalization, specialization, sector’s opening to private actors.

Market nationalization

CAAR (Compagnie Algérienne d’Assurance et de Réassurance) was established in 1963 with a view to manage the legal cession and develop a direct portfolio. Foreign companies found themselves compelled to cede 10% of their portfolio to CAAR, a move they were not willing to consider. Instead, they decided to suspend their operations in the country. Their stakes were bought back by CAAR and SAA (Société Algérienne d’Assurance), the latter being then a mixed Algerian-Egyptian company established in 1964.

Following the withdrawal of European insurers in 1964, CAAR, SAA and STAR (Tunisia) which bought back the portfolio of the Mutuelle Générale Française Accident (MGFA), currently named Mutuelles du Mans, were the sole companies operating there. Two local mutuals, the Caisse Mutuelle Nationale Agricole, (CMNA) and the Mutuelle Générale de l’Education Nationale (MGEN) complete the market.

In 1966, the Algerian authorities nationalized all foreign companies, establishing State monopoly over the insurance business.

In 1975, CCR started operating. Its capital was initially detained on equal shares by CAAR and SAA who were required to cede all their reinsurance to it. CCR, therefore, became the only counterpart dealing with foreign reinsurers.


Following the removal of intermediaries’ networks, general agents and brokers at the beginning of the 1970s, the whole market was made up of state-run companies, endowed with direct underwriting offices and managed by salaried staff.

From 1973 to 1989, the State introduced market specialization. CAAR was entrusted, in the first place, with industrial risks and marine insurance whereas SAA obtained monopoly over personal line risks. In 1982, marine business was withdrawn from CAAR and entrusted to the Compagnie Algérienne d’Assurance Transport (CAAT), newly established to manage this kind of risks.

In 1982, the Algerian market’s structure was as follows:

  • CAAR, specializing in industrial risks,
  • SAA, specializing in personal line insurance,
  • CAAT, specializing in marine insurance,
  • CCR specialized in reinsurance.

In addition to these limited companies, we also find CNMA for agricultural risks and MGEN which continued to manage personal line risks for the benefit of national education staff members.

The market’s opening to the private sector

In 1989, insurance companies’ specialization was given up.

In 1995, a new legal framework was adopted, putting an end to State monopoly over insurance activities. Henceforth, the establishment of private insurance companies became permitted. The Compagnie Internationale d’Assurance et de Réassurance (CIAR) was the first company to benefit from this opening.

Finally, the February 2006 decree came to complete the legislative panorama:

  • by imposing a separation of life and non-life activities,
  • by introducing bancassurance,
  • by authorizing the opening of branches for foreign insurance and reinsurance companies.

Historical overview on insurance in Morocco

Bab Bou Jeloud, Morocco © Bjørn Christian Tørrissen, CC BY-SA 3.0

As is the case for the rest of the Maghreb, it is with the arrival of Europeans and the institution of the French protectorate, mainly, that the insurance business got established in the kingdom. The first insurance schemes date back to the second half of the 19th century, emanating mainly from the system of foreign concessions authorized by the December 1856 treaty. The first branches were specialized in marine insurance: the Espagnola in 1879, the Centrale and the Réparation in 1883, the Manheim in 1886, Calpean Maritime Insurance in 1887 are the first examples. In 1916, the first local company, but with foreign capital, “Le Maroc”, was established in Tangier based essentially on marine and war risks.

Until the Second World War, the insurance market had been dominated by brokerage firms and branches of foreign companies.

The September 6, 1941 decree provided for the reorganization of the sector by the State. Insurance practice was only possible for the licensed companies. Local risks had to be insured on the Moroccan territory. A regulation, pertaining to the technical and financial aspects, was enforced. The market, therefore, became made up of Moroccan local companies and foreign insurers having obtained authorization to set up branches.

The Royale Marocaine d’Assurance (RMA), established in 1950, was the first entirely Moroccan-owned company. In 1958, two years following independence, 315 companies, 23 of which Moroccan, shared a market worth 150 million MAD. Because private investors were hardly attracted to insurance, the State was pushed to set up in 1960 the Société Centrale de Réassurance (SCR)) which it controlled through the Caisse de Dépôts et de Gestion. All insurance companies were then required to cede part of their businesses to SCR through a 10% legal cession. The same year, the authorities encouraged the establishment of a direct insurance company: The Compagnie Nord Africaine et Intercontinentale d’Assurance (CNIA) which they control.

The multitude of companies compelled the regulators, back then, to introduce a series of measures in favor of the market cleanup. Mergers were encouraged while those insurance structures, reluctant to comply with the measures in force, were closed down by the authorities.

In 1962, there were 237 insurers in Morocco, 23 of whom had Moroccan status, sharing a market worth 156 million MAD.

To promote mergers, the regulators imposed, in 1965, a minimum turnover of 1 million MAD for each company. This minimum was raised to 4 million MAD in 1968 while Mergers and acquisitions were boosted. In 1970, only 40 insurance companies, operating in a stiffening regulatory framework, survived. In 1975, only 27 companies were present on the market.

It was during the 1990s that the current market panorama took shape. Radical recovery measures were imposed, which led to the winding up of five insurers: the Compagnie Atlantique d’Assurances (CADA), la Renaissance, la Victoire, la Réunion Marocaine d’Assurance et de Réassurance (REMAR) and Arabia Insurance. As no licenses were further granted, the insurers present on the market were encouraged to merge. Since 2001, only 18 insurers, three of whom are mutuals, continued to operate reporting a global premiums volume worth 10.3 billion MAD, that is, 2.5 times as much as in 1990.

A historical overview on insurance in Tunisia

The pre-independence Tunisian market

Photo credit: Rais67 (modified picture)The start of Tunisian insurance dates back to 1874 when the company Phénix Vie opened a representation office in Tunis. A few years later, the first French insurance agencies emerged. At that time, the few thousand European settlers established in the country, the majority of whom were Italian and Maltese, accounted for a very interesting portfolio. Just like Algeria, only foreigners got insured.

In 1882, a year after the establishment of the French protectorate in Tunisia: Phénix Incendie, Centrale Incendie and Renaissance arrived in Tunis. But the market was not boosted until 1885 with the opening of agencies of The Providence (1885), of Aigle-vie (1886), of Compagnie d’Assurances Générales-Vie (1886), of Nationale-Vie (1886) and Urbaine and the Seine (1890). Alongside those French companies, two American, two British, two Swiss, one Spanish and one Italian got established in Tunisia between 1886 and 1900.

Insurers created between 1874 and 1900
 NationalityCreation date
French1874 (life) and 1882 (non life)
La Providence
The Métropole
French1886 (life) and 1897 (non life)
The Cie d’Assurances Générales-vie
French1886 (life) and 1896 (non life)
New York Life
The Nationale
French1886 (life) and 1897 (non life)
Urbaine et la Seine
Assicurazioni Generali
Mutual Life
Source: "Histoire de l’assurance en Tunisie " (historical background of insurance in Tunisia), Jacques Charbonnier

The beginning of agricultural insurance dates back to 1912 with the establishment of the Caisse Régionale d’Assurance Mutuelle “Tunis Assurances”.

In 1919, 131 insurers were present in the country, 26 of whom were marketing life policies. In 1929, the number of companies grew to 202, most of which were French, British and Italian.

Just like in Algeria and in Morocco, the French companies reported the most of their turnover in life insurance. Tunisian and foreign companies were basically underwriting non-life risks with about 40% of premiums in fire and marine classes.

After the Second World War, the market witnessed a quick growth, with the turnover going threefold between 1947 and 1950 and 2.5 times between 1950 and 1954. Indeed, premiums went six fold during the 1947-1954 period.

It was also after the Second World War that the first Tunisian insurance companies started to emerge. On the wake of independence, those companies controlled 20% of the local market. The Lloyd Tunisien and Astree were respectively set up in 1945 and 1949.

On the eve of independence, that is in 1954, 188 foreign insurers were present in Tunisia:

Source: "Histoire de l’assurance en Tunisie" (historical background of insurance in Tunisia), Jacques Charbonnier
The post-independence Tunisian market

Independence, obtained in 1956, marked a turning point in the market structure as the foreign companies established in the country considered the new legal framework instituted by the authorities to be excessively restrictive. Between 1956 and 1961, many of those companies either ceded or merged their portfolio.

In 1958, the Société Tunisienne d’Assurance et de Réassurance (STAR) was established with a capital detained at 50% by the State, 30% by Tunisian private individuals and legal entities and 20% by foreign insurance companies, among which Swiss Re. In addition to its direct underwriting operations, STAR was entrusted by the State to manage, from 1960 to 1980, its reinsurance legal cession which amounts to 10%.

The establishment of private insurance business was encouraged by the authorities which led to the emergence of many private groups on the market between 1968 and 1976.

It was during that same period that the first life insurance company, AMINA, was set up with GAT being its major shareholder.

The tunisification of the market was achieved by 1981 with the establishment of the Société Tunisienne de Réassurance “Tunis Re”, whose capital is entirely Tunisian. The 10% legal cession came to an end with the arrival of Tunis Re on the market.

Private groups present on the market between 1968 and 1976
 Creation datePurchase of portfolios1
1968The Paternelle africaine,
The Prévoyance and the Minerve (France)
1973Generali (Italy)
Groupe des Assurances de Tunisie (GAT)
1975Groupe des Assurances Nationales-GAN (France), the Secours (France) and Arabia Insurance (Lebanon)
1976Mutuelle Générale Françaises, Mutuelle du Mans (France) and Préservatrice-Foncière (France)
1 Non exhaustive list Source: "Histoire de l’assurance en Tunisie" (historical background of insurance in Tunisia), Jacques Charbonnier
  • Atlas documentation database
  • Sigma magazine, Swiss Re
  • "Histoire de l’assurance en Tunisie (the historical background of insurance in Tunisia)", Jacques Charbonnier, Taâminat collection, Cérès editions 2006.
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