The CIMA's general secretary, Issofa Nchare confirmed on the occasion of the CIMA/FANAF round table, held on Monday 18 February 2019, as part of the FANAF 43rd General Assembly, the deadline for the capital increase of insurance companies of the CIMA zone [4], which is still set at 31 May 2019.
The insurance companies have a little more than 90 days to increase their minimum capital from 1 billion FCFA (1.7 million USD) to 3 billion FCFA (5.2 million USD). Inspections will be held within the companies in June to monitor the implementation of the new capital-intensive standards.
Out of the 180 companies in the CIMA zone, only 20 were compliant with the standards according to a toll t established in mid-November at the market forum held in Cotonu. Apart from the profits associated with the consolidation of the sector and the emergence of giant insurers, the measure raises the following problems:
- the withdrawal of certain players from small markets resulting in a monopolistic situation,
- the degradation in the quality of customer service due to the declining competition.
Although the reporting of the last audit of the companies being reviewed shows that the majority of companies are able to adapt to the new regulations, several concerns emerge, namely:
- the decrease in the return on the shareholders' equity,
- the difficulty of finding local partners for the acquisition of shares
- the exchange policy which hampers the investors during the transfer of funds from the UEMOA Zone (West African Economic and Monetary Union) to the CEMAC area (Central African Economic and Monetary Community).