‘Risk mechanism is bedrock of African growing economy’

THE management of Continental Reinsurance Plc, has said asserted that insurance has an immense role to play in Africa’s growing economy.

The Group Managing Director of the company, Dr. Femi Oyetunji, said this during the second edition of its chief executive summit for African leaders in South Africa held recently on the theme, “Changes and challenges shaping the context of the African insurance landscape in 2015.” 70 delegates from 20 countries participated at the summit.

According to him, “The impact of insurance on the growing African economy is immense as it plays an important economic and social role”.

He said the African insurance sector was at an early stage of development which was observed in the low penetration rates in comparison to the rest of the world:

According to available statistics, he said Africa (including South Africa) has 3.5 percent penetration; Asia has 5.4 per cent; Europe has 6.8 per cent; while North America has 7.4 per cent.

The insurance penetration rate in South Africa he noted was 15.4per cent, Namibia has 7.7per cent, Kenya has 3.4 per cent, Morocco has 3.0vper cent and Nigeria has 0.6 per cent.

As Africa’s largest private reinsurer outside of South Africa, he added that Continental Reinsurance was committed to advancing the insurance sector in Africa.

He said Continental Reinsurance was taking the CEOs platform to the next level and moving away from it being an annual event to a 24/7 discussion platform so that such an event like the outbreak of ebola in an African country would have been picked up immediately.

He said insurers have an important role to play on the development and issues affecting the continent.

“Our conversations should not just be when we meet once a year, rather, we will be looking at sustaining the discussions throughout the year i.e. from one summit to the next, using the social media,” he said.

One of the reasons for the gathering of business leaders, he added, was to consider emerging risks and trends which affect the industry.

He said the insurers need to identify and anticipate such risks, discuss them in detail from the point of view of first of all identifying the risk factors and consequently developing risk mitigating plans.

“As insurers, risk management should be as important to us, as risk taking. We therefore need to refocus our role from being that of primarily risk takers to risk managers,” Oyetunji said.