Managing Director of the country‘s oldest short term insurance company - Botswana Insurance Company (BIC) – has linked the rife competition in the sector to slow economic growth being experienced.
Johan Classen said that BIC is however focused on adaptation and innovation, which are essential elements for success. Even though the market has been a challenge, Classen said that BIC has experienced continuous growth in their target areas.
He cited among some of the challenges likely to affect the insurance sector the uncertainty in global markets, and the fact that intangible products such as insurance are often seen as a low priority investment.
As for adding more products in future, Classen said that evidence from their market research survey has shown that there are market opportunities within the industry, which competitors have not tapped into. BIC is therefore working on convenient, simple and affordable new insurance solutions.
Commenting on the benefits they have on the anticipated growth of the construction industry this year, Classen said that the demand for property remains positive which indicates that people are buying and building more houses, which will mean demand for insurance property will be on the rise. He said this would be due to the anticipation that the construction industry will this year experience a slight increase in growth due to proposed construction projects that are set to break ground in 2016.
The Nigerian Stock Exchange listed company, Continental Re-Insurance, also complained of challenges that they have in the insurance industry which include devaluation of currencies, resulting in impairment of assets and claims inflation and persistence of soft pricing due to limited growth and lack of new investments in re-insurance sector across the African region.
General Manager of Continental Insurance Samuel Rimai projected growth in non-life premium insurance to improve from 3 percent in 2016 to 3, 2 percent in 2017. He however said property catastrophe reinsurance rates are currently close to bottoming out and the rate softening expected to moderate or come to a standstill.
Rimai said globally South African and regional insurance groups continue to expand their footprint in Sub Saharan Africa thereby enhancing capacity and expertise in the region. He noted that Continental Re- Insurance’s key strategy is to provide relevant solutions to Africa‘s insurance and re-insurance needs.