Africa’s anticipated 4.5% GDP growth in 2015 is expected to drive the expansion of insurance of African entities by both regional and global insurers.
The current low uptake by global insurers is set to change, delegates heard today at the fifth annual Africa Insurance and Reinsurance Conference, held in Kenya’s capital, Nairobi.
Nick Wells, South Africa-based Swiss Re Life and Health Africa Ltd senior client manager, told the conference that the GDP growth would be driven by global economic recovery, strong foreign direct investment, which is estimated at 10.6% for 2008-13 compared with 5% for 2003-07, and the oil and natural resource exploration boom.
“The projected GDP growth in sub-Saharan Africa provides huge investment opportunities for insurers both in life and non-life insurance,” Wells said.
Africa’s economic growth is likely to boost the continent’s seaborne trade, currently estimated at 90% of its total trade.
“There is demand for risk managers to ensure a sustainable insurance industry for customers, regulators, and insurers,” said Wells.
He said that in the short term a “strong insurance market growth is projected” with non-life insurance market share of the region’s economies in sub-Sahara Africa, though it would be slower in South Africa, where it is likely to grow just 10% in the next 10 years.