AIO President solicits for improve insurance penetration rates in Africa
*Celebrates 50th anniversary at 48th AIO conference in Nairobi, Kenya
The President of African Insurance Organization (AIO) has called on African insurance markets to improve on the level of insurance penetration rates in Africa.
The AIO boss who is also Group Managing Director/ CEO, NEM Insurance Plc, Mr. Tope Smart, in a speech to members of the organization believes that this could be achieved via solutions that improve access to insurance, the reputation of the African insurance industry and insurance awareness in Africa.
According to him, the African insurance industry still suffer from very low insurance penetration rates when compared to global rates with an average of less than two per cent if we remove South Africa, this shows the weakness of our industry, and the vast potentials to be exploited.
Specifically, the AIO boss said “Dear AIO members, As we slowly recover from the numerous restrictions imposed on us by the Covid-19 pandemic, I wish to convey my best wishes and those of the entire management of the AIO, as we prepare to celebrate 50 years of the AIO.
As you are no doubt aware, the African insurance industry still suffers from very low insurance penetration rates, when compared to global rates, with an average of less than 2% if we remove South Africa. This on one hand shows the weaknesses of our industry and on the other the vast potential yet to be exploited. According to a 2018 Lloyd’s publication, even a 1% increase in insurance penetration will reduce the disaster recovery burden on developing countries by 22%. We believe it is our mission to improve insurance penetration via solutions that improve access to insurance, the reputation of the African insurance industry and insurance awareness in Africa.
As part of measures to address this challenge, I appeal to different markets to scale up it’s advocacy initiative by collaborating with various organs of Government to advance the course of Insurance as this will lead to increased penetration.
The African Continental Free Trade Area (AfCFTA) is set to become the world’s largest free trade area in respect of the numbers of participating countries. It is one of the flagship projects of the African Union’s Agenda 2063: “the Africa We Want”. We believe that the AfCFTA could play a significant role in improving insurance services through liberalization (eliminating non tariff barriers and refraining from introducing new ones) and integration. The AIO shall advocate for integration of the African insurance industry in the AfCFTA implementation.
Furthermore, Governments are increasingly using insurance to achieve public policy objectives and the AIO, again through its advocacy role, shall seek to advance the policy interests of Africa’s insurance industry, to create a conducive and enabling environment for insurance in Africa to thrive.
May I use this opportunity to remind you that our cherished AIO, is 50 years old.
Activities to mark this milestone anniversary will hold in Nairobi, Kenya alongside our 48th Conference and Annual General Assembly. The host Kenya market and the AIO Secretariat have been working tooth and nail to make the celebration a memorable one. However, this can only be achieved through your support. I wish to appeal to AIO members to come out in their numbers and give their flagship event its merited grandeur.
The 48th AIO Conference will focus on one of the key global issues, Climate Change under the theme ‘Insurance and Climate Change: Harnessing the Opportunities for Growth in Africa’.
Let’s come together also, not just to celebrate the achievements of the AIO at 50 years, but also to look at ways in making the Organisation more useful to us members, the African insurance industry, and the entire continent through a symposium on the theme AIO at 50: A CALL FOR AFRICAN INSURANCE RENAISSANCE.
I look forward to meeting you in Nairobi for a memorable 48th Conference and 50th anniversary celebration”.