Presentation on theme: "TOUR OF FRANCOPHONE AFRICA Life Insurance in the FANAFarea Presented by Claude Daté GBIKPI Managing Director GTAC2A-VIE (TOGO)"— Presentation transcript:
TOUR OF FRANCOPHONE AFRICA Life Insurance in the FANAFarea Presented by Claude Daté GBIKPI Managing Director GTAC2A-VIE (TOGO)
INTRODUCTION Over a total of US 4.597 billion in 2011, Africa represents 2.2% (Life & non Life market) of the world insurance market of which 53% as share for non-life and 47% for life. South Africa alone holds 90% of the 2.2%. Over the remaining10%, the share of the FANAF zone represents less than 4%. The hereby study aims at presenting the development of the life insurance market in the16 countries of the FANAF zone over the period 2007 to 201I.
OUTLINE OF THE STUDY I - Presentation of the region II – The countries of the region III – development of the life premiums issued IV - Profil of the countries studied V - Other information
II – THE COUNTRIES OF THE REGION By alphabetic order BENIN (BEN) GUINEA CONAKRY (GIN) BURKINA FASO (BFA) MADAGASCAR (MGA) BURUNDI (BDI) MALI (MLI) CAMEROON (CMR) NIGER (NER) CENTRAL AFRICA (CAF) RWANDA (RWA) CONGO BRAZZAVILLE (COG) SENEGAL (SEN) COTE D’IVOIRE (CIV) TCHAD (TCD) GABON (GAB) TOGO (TGO)
III - DEVELOPMENT OF LIFE PREMIUMS ISSUED In 2011, the16 countries except Madagascar and Guinea Conakry (data 2008) collected in terms of direct turnover 210 milliards of francs CFA de net of avoidance premium (321 million Euros) that is a progress of 7.1% par rapport à 2010. These premiums represent 28% of the total amount of premiums issued (life & non-life) of the region.
Tableau 1 : Development of Life premiums issued from 2007 to 2011 Share by country of the zone Source: FANAF
Graph 1 : Development of the Life premiums from 2007 - 2011 (in francs CFA billion)
Graph 2 : Development of Life premiums by country in 2011
Comment on the Graph 2 (Life premiums by country in 2011) In 2011, the main market remains Côte d’Ivoire with 79.4 billion francs CFA, that is 38 % of the FANAF market, followed by Cameroon (16%), Senegal (11%). These three countries represent 65% of the market studied. Then come : Gabon (7%), Burkina (6%), Togo (6%) and Benin (5%). The other countries (Congo Brazzaville, Burundi, Central Africa, Guinea Conakry, Madagascar, Mali, Niger, Rwanda, Tchad) have a total of 11%.
Graph 3 : Growth rate of the Life premiums by country in 2011
Comment on graph 3 (Growth rate of the Life premiums by country in 2011 ) In 2011, Mali had the most outstanding growth(+52.9%) followed byTogo (+36.7%) andGabon (+23.4%).
Tableau 2 : Share of the Life premiums issued in the GDP by country from 2007 to 2011 Source: FANAF
Graph 4 : Ratio premiums issued out of the GDP by country in 2011
Comment on Graph 4 : (Ratio premiums issued out GDP by country in 2011) The penetration rate inthe area is generally below 1%. In 2011, Togo had the highest ratio with 0.8% follows Côte-d’Ivoire (0.70%) which is stagnating a little compared with Togo that had an outstanding progress moving from 0.35% in 2007 to 0.78% in 2011.
Graph 5 : Illustration of the development of the shares of the premiums issued in the GDP of the region from 2007 to 2011
Graph 6 : Life premiums issued per inhabitant and per country in 2011 (in F.CFA)
Comment on the graph 6 (Life premiums issued per inhabitant and per country in 2011 (in F.CFA) Significant disparity depending on the country(from 14 francs to 10 011 francs) In 2011, the highest average of premiums élevée was in Gabon (10 011) before Côte d’Ivoire (3 501) and Togo (1 866)
Graph 7 : Life premiums issued per inhabitant from 2007 to 2011
IV – Profile of the countries studied Number of companies in 2011 The region has164 member companies of which : - 44 life companies ; - 105 non-life companies; - 13 Reinsurance companies or regional offices ; - 2 funds guarranteeing liabilities
Types of products marketed They can be grouped in three main branches : - Individual Insurances : In the case life ; in case of death ; endowment ; saving ; capitalization and supplementary insurance. There are Retirement with or without death, term death, Group Borrower with the la coverage Job Loss etc… They represent 51% of the premiums collected in 2011. - Collective Insurances : in the case of life; in case death ; endowment ; saving ; capitalization and supplementary insurance. We can quote termination allowances ; Global retirement ; Corporate provision. They represent 48% of the premiums. - Acceptances 1%
Table 4 : Life premiums issued per product branch in 2010 & 2011 Life branch(Figure in francs CFA million) 2 010 2 011 Var. 2011/2010 in % Individual Insurances 106 923 105 545-1.3% Collective Insurances 86 064.3 101 216.117.6% Acceptances 1 886.2 2 067.89.6% Total 194 874 208 828.97.2%
Graph 8 : Distribution of the life premiums issued per branch in 2011
Comment on graph 8 (Distribution of the life premiums issued per branch in 2011) Individual Insurance represent 51% of the premiums collected in 2011 and collective Issurances 48%
V – Other information Distribution Network Brokers Middlemen commissioned by the company General agents Life insurance adviser Freelancers Banks BanKinsurance
Micro insurance It is one of the innovations of the Cima code with the birth of the book VII. It is characterized by : Low premium and /or proceeds. Simplicity of the coverage, underwriting formalities, of the management of contracts, of the statements of claims and the compensation victims.
Protection of low income people against specific risks enin consideration of payment of premiums or assessment Drafting of contract in a simple, clear style that can be easily understandable by the target population and notwithstanding the provisions of the article7, the contract may be translated and marketed the local language of the target population.
Clauses related to the sending of registered letter are facultative, a mere letter. The Insurer must pay the surrender value within the10 days under the condition of two months payment or when10% of the premiums planned in the contract have been paid. Can be underwritten by : A legal entity A company for employees A communauty for members A natural person
Implementation of new mortality tables The stakes of the reform: Provide Life insurance companies with adapted tools for life risks pricing in Africa Set up a life risk piloting culture with statistics specific to our environment.
The regulation 0006/CIMA/PCMA/PCE/2012 dated October 4th 2012 (which has a binding force since February 2013) relating to the implementation of new mortality tables leads to a review of the prices and change in the general conditions of contracts. For Insurances in case death, the CIMA table replaces theTD regulatory table H. For insurance in case of life, the CIMA table F replaces the regulatory table TV.
The coming into force of these tables impacts both on the prices and reserves : Review of prices and change in the general conditions of contracts; Processing of deviations (if any) of the reserves
For contracts in case of death, a decrease in the price from 6% to 35% and from10% to 35% for the provisions. For mixed contracts, a decrease in the prices from 1 to 18% and a negligible impact on the provisioning. For contracts in case of life, the CIMA table F will lead to an increase in the prices from 1 to 60% and more for termination allowance contracts. It is the same thing for provisions. The increase becomes more intense with the duration durée and seniority of the contracts
The new tables will enter into the pricing of new businesses and the renewal of annual contracts by automatic renewal starting from the effective date of the regulation relating to their adoption.