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					                                                          N° 68
                                                      February 2010

                                      Atlas Conseil International

                            Atlas Magazine
                           Insurance news from Africa and the Middle East

                                     Editorial                                                        Close up p. 2

                                               China : the long march                                 Country Profile p. 3 - 6
                                                                                                      Côte d’Ivoire

                                     N      o sooner had 2009 gone than we started
                                            dreaming about 2010, the year meant to
                                     consolidate insurance which is coming through
                                                                                                      Special p. 7
                                                                                                      Downward trends of
                                     after two poor years.                                            insurance tariffs

                                         The optimism that has been prevailing
                                     recently should not conceal a possible relapse,                  Focus p. 8 -12
                                     hence the need to remain vigilant.                               Credit insurance
                                         For many observers, the year 2010 marks the
                                     beginning of a profound market restructuring.                    News p.13 - 20
                                     The big insurers and reinsurers, who are back to                 Insurance news
                                     business, are aware that the crisis has altered the
                                     insurance landscape. Many signs are proving this                 Statistics p. 21 - 22
                                     upheaval, the first of which is the emergence of                 The Omani insurance
                                     China as a future insurance pole.                                market in 2008
                                         In a few years, China’s premiums will overtake
                                     those of the main European countries. The                        Agenda &
                                     establishment of an Asian market around Beijing                  Reshuffles p. 23 - 24
                                     including Japan, South Korea, India, Vietnam is
                                     not an imagination but a plain reality. This
                                     change of the insurable mass explains the rush of
                                     the great international insurers towards Asia.
                                                                                                      Gabon :
                                         The purpose is to get established as close to
                                     Beijing as possible and to be able to catch the                  CIMA : taxation of
                                     new premium volumes. Singapore and Kuala                         insurance premiums.
                                     Lumpur are poised to be dethroned by Beijing                                 More page 13
                                     and Shanghai.
                                                                                                      Nigeria :
                                         Small consolidation moves of Swiss Re or
                                     Allianz will not do. Instead, large-scale operations             Insurers ’profits
                                     requiring a coherent strategy, a perfect logistics               contracted by reforms
                                     and enormous financial resources will take over.                 introduced.
                                     Henceforth, only the rich get richer.                                        More page 14

                                                                                                      Morocco :

                                                              Atlas Conseil International
                                                                                                      Legal cession.
                                                                                                                  More page 17
ACI                                         Swiss Re once again interested in
                                                                                                      Tunisia :
                                                                                                      Tunis Re is getting listed.
5, rue Imam Sahnoun                      Swiss Re has envisaged to make new                                       More page 17
Le Belvédère,Tunis 1002              acquisitions should a new opportunity come up on
                                     the insurance and reinsurance market.                            Bahrain :
Tél. : (216) 71 28 70 96             The reinsurer which recovered a sum of 300 million               The best 2009 Takaful
Fax : (216) 71 28 76 24              CHF (288.5 million USD), after having ceded a life               operators elected by
                                     insurance portfolio to Berkshire Hathaway, plans on
                                                                                                      CPI Financial.
                                     taking advantage from the sector’s consolidation
                                     phase to strengthen its position.                                            More page 18
Mail :
                                                                                                          Close up

Haiti, devastated by a destructive                            New minimum capital
earthquake.                                                   requirements for insurers and
The terrible earthquake which hit Haiti on January
                                                              reinsurers in the United Arab
12, 2010 has claimed 150 000 lives, left more than            Emirates.
1.5 million people homeless and caused important
damages, mainly in Port-au-Prince up to January               In line with what has been instituted for brokers, the
25, 2010.                                                     federal authorities have provided insurers and
In this small country of 9 million people, 80% of the         reinsurers with a three-year deadline to meet the
population are living under the poverty line of two           new capital requirements. As far as insurers are
dollars a day, insurance is hardly developed.                 concerned, the minimum capital has been set at
According to the figures provided by Haiti’s first
                                                              100 million AED (27 million USD), compared to 50
insurer, Alternative Insurance Company (AIC), only
                                                              million AED (13.6 million USD) so far. As to reinsurers,
300 000 people have an insurance policy, that is,
less than 4% of the entire population.                        the minimum capital has been set at 250 million
The 2008 non-life premiums did not exceed 20                  AED (68 million USD). Furthermore, 75% of insurers’
million USD, which roughly accounts for 0.29% of GDP.         capital operating in the country must be in the
The natural catastrophe risks have been covered by            hands of national institutions or originate from the
the pool Caribbean Catastrophe Risk Insurance                 Gulf Cooperation Council countries. The resolution
Facility (CCRIF), an inter-governmental entity which          applies to all insurers and reinsurers operating in the
insures risks for the 16 countries of the Caribbean           country (outside the free zones).
region. In June 2010, Haiti has renewed , with the
same pool, its earthquake and storm covers for
approximately 385 500 USD. The compensation the
                                                              High loss experience for aviation
country will receive for the January 12, 2010 claim           insurance in 2009.
will amount to about 8 million USD, that is, twenty
times the premium paid.                                       In 2009, aviation insurance has reported a
The exposure of the reinsurers operating on the               considerable rise of its loss experience while the
Haitian market is very low. Hannover Re has                   number of air crashes went down. The Buffalo
estimated its risk at 29 million USD and Munich Re at         Colgan Air crash (USA), that of Air France Rio-Paris
15 million USD.                                               and that of Yemenia Airways near the Comoros
Located on a zone of fractures, Haiti has witnessed
                                                              have claimed the lives of 428 people and cost
several devastating earthquakes throughout its
                                                              1 billion USD of damages.
history. The most violent ones are those which
occurred in October 1751, June 1770 and May 1842.             According to the first estimates, the total amount of
                                                              the 2009 losses could amount to 2.5 billion USD,
                                                              whereas insurers managed to collect only 1.9 billion
The financial authorities have
                                                              USD of premiums. The year 2009 has turned out to
cancelled 74 licenses of                                      be the most costly in terms of claims, following the
brokerage companies in the                                    year 2002, which, with the 9/11/2001 attacks cost
                                                              losses worth 5 billion USD.
United Arab Emirates.                                         In order to face such results, the aviation insurers
The financial authorities have established new                have stiffened the 2010 underwriting terms. During
criteria to bring insurance market standards closer           the December 2009 renewals, significant increases
to those of most advanced countries.                          have been noticed for some kinds of covers.
To do so, a 2006 decree set the minimum capital of            Some experts have evoked tariff increases
a brokerage firm at 1 million AED (272 310 USD), the          comprised between 15% and 20%. This upward
bank guarantees necessary for a reinsurance                   trend is poised to continue in 2010.
brokerage activity to 1 million AED (272 310 USD) for
the head office and 500 000 AED (136 155 USD) for
each branch.                                                                           2008        2009   Average     (*)

A three-year deadline has been set for the brokers           Number of accidents         32          30         32
to comply with the new instructions.                         Number of victims          577        757         802
As this grace period came to an end, the
                                                             Insurance premiums
supervisory authorities decided to withdraw the                                          1.6        1.9           -
                                                             in billions USD
licenses of 74 brokers who failed to respect the new
                                                             (*) Annual average of the last ten years .
regulations. Following this move, the number of
operating brokers amounts to 135.

                                        Atlas Magazine . N° 68 . February 2010

Côte d’Ivoire

                Country profile
 Area : 322 463 Km2
 Population (2008) : 20 590 000 inhabitants
 GDP (2008) : 23.41 billions US
 GDP per capita (2008) : 1 137 USD
 GDP growth rate (2008) : 2.2%
 Inflation rate (2008) : 8.1%
 Main economic sectors : Agriculture (coffee,
 cocoa, bananas, pineapple, palm oil), gum and
 natural rubber production, food industry, wood
 production, textile industry, buses and trucks
 assembling, construction and repair of ships.

                  Major cities
                (per number of inhabitants)

                Abidjan : 3 000 000
                 Bouaké : 600 000
                  Daloa : 135 000
                 Korogho : 115 000
           Yamoussoukro (capital) : 110 000
                                                                             Insurance market features
                                                                       Regulatory authority : Ministry of Economy and
                                                                             Finance : Insurance Department
                                                                     Life and non life premiums (2008) : 368 million USD
      Insurance market structure                                               Insurance density (2008) : 17.8 USD
               in 2008
                                                                                  Penetration rate (2008) : 1.57%
           Insurance companies :         32
              Non life companies :        21
              Life companies :            11

           Reinsurance company :              1
                                                                                   Life and non life premiums
                                                                                in 2008 : 368 million USD

Breakdown of life and non life premiums 2004-2008

                                                                                               Figures in thousands USD
                    2004                  2005                     2006                 2007                2008
   Non life        159 812                    144 396              171 932               202 945              221 346

   Life              93 575                    92 906              115 929               137 333              146 751
   Total          253 387                 237 302                 287 861               340 278              368 097
  Exchange rate as at 31/12/2004 : 1 USD = 480.076 FCFA ; as at 31/12/2005 : 1USD = 545.853 FCFA ; as at 31/12/2006:
  1USD = 477.782 FCFA ; as at 31/12/2007 1USD = 436.872 FCFA ; as at 31/12/2008 : 1USD = 454.545 FCFA.

                                              Atlas Magazine . N° 68 . February 2010

Turnover ’s evolution: 2004 - 2008

  500 000
              Figures in thousands USD

  400 000

  300 000                                                                                                         Life
                                                                                                                  Non life
  200 000

  100 000

              2004              2005        2006           2007            2008

Breakdown per class of business in 2008
                                                                                  Figures in thousands USD

                                                             Premiums                  Market shares
               Health                                             62 121                       16.9%
               Motor                                              81 734                       22.2%
               Fire and property damage                           38 764                       10.5%
               Third Party Liability                               9 610                        2.6%
               Marine                                             20 588                        5.6%
               Miscellaneous accident                              8 529                        2.3%
               Total Non life                                  221 346                        60.1%
               Life                                             146 751                       39.9%

                           Grand total                          368 097                        100%
              Exchange rate as at 31/12/2008 : 1USD= 454.545 FCFA.

                                                                                                             Health 16.9%

                   Life 39.9%

   Miscellaneous accident
                                                                                                             Motor 22.2%
                       Marine 5.6%
                                                                      Fire and property
                      Third Party Liability 2.6%
                                                                       damage 10.5%

                                             Atlas Magazine . N° 68 . February 2010

      Non life companies’ turnover per class of business in 2008
                                                                                                                               Figures in USD
                  Health        Motor           Fire and           Third Party      Marine            Miscellaneous       Total       Market
                                            property damage         Liability                           accident                      shares

COLINA SA      12 677 536      12 608 900     14 240 600            1 823 989       7 772 099             621 914       49 745 038      22.5%

NSIA CI        10 759 456       8 494 067      5 901 852            2 241 718       1 950 811             662 211       30 010 115      13.6%
LMAI            7 834 439       4 535 081      4 367 524               861 115        442 753               -           18 040 912       8.2%
AGF*            1 567 489       3 687 880      5 329 544            1 696 569       3 301 523           2 074 622       17 657 627       8.0%
AXA             4 175 936       4 989 789      3 509 043              739 555       3 981 848               -           17 396 171       7.9%
LOYALE          5 269 453       6 143 855      1 876 262              564 858         303 120           2 038 862       16 196 410       7.3%
SIDAM           7 703 121       4 421 605        498 589              324 226         169 891             111 561       13 228 993       6.0%
MATCA                -          7 081 413          -                   -                  -                -             7 081 413       3.2%
MACI            2 174 250       2 628 023        446 247                   84 576   1 745 732              -             7 078 828       3.2%
CEA               740 930       4 574 259        834 325              417 162         351 440              -             6 918 116       3.1%
CNA -CI           540 445       3 590 495        362 003              164 481         117 227           1 463 914        6 238 565       2.8%
SAFA            1 457 428       3 609 130        149 654                   77 766         16 074           -             5 310 052       2.4%
ATLAS           1 501 826       3 291 986              3 720               58 037             6 500       326 465        5 188 534       2.3%
SONAR CI        2 602 623       1 401 359        467 812                   90 340     101 661              -             4 663 795       2.1%
MCA             1 835 942       2 214 757        236 756                   90 765     151 145              79 752        4 609 117       2.1%
AMSA              298 650       2 954 018        428 560              247 898             77 185            -            4 006 311       1.8%
FEDAS CI          462 034       2 091 301          46 204                  58 797             4 146        64 892        2 727 374       1.2%
SOMAT             216 321       2 140 829          52 643                  31 454             5 536        -             2 446 783       1.1%
A,A,A             302 787       1 275 669          13 724                  35 971         89 137            -            1 717 288       0.8%
GMTCI               -              -               -                   -                  -               542 822         542 822        0.2%
SIAC                 -             -               -                   -                  -               541 454         541 454        0.2%

   Total       62 120 666      81 734 416 38 765 062                9 609 277 20 587 828               8 528 469 221 345 718            100%
Exchange rate as at 31/12/2008 : 1USD= 454.545 FCFA.
(*) has been renamed Allianz-Côte d’Ivoire since October 1, 2009.

      Market shares of the top ten non life companies

                                   CEA 3.1%                    Others 17.0%
                   MACI 3.2%
                                                                                                                COLINA 22.5%
                MATCA 3.2%

                 SIDAM 6%

              LOYALE 7.3%
                                                                                                           NSIA 13.6%

                                AXA 7.9%
                                                AGF 8.0%                                  LMAI 8.2%

                                                 Atlas Magazine . N° 68 . February 2010

Life companies’ turnover in 2008
                                                                                  Figures in USD
                                                     Turnover                    Market shares
                      COLINA VIE                    34 022 368                        23.2%
                      UA VIE                        30 228 059                        20.6%
                      AGF VIE                       19 159 475                        13.1%
                      NSIA VIE                      18 350 312                        12.5%
                      LMAI VIE                      15 410 132                        10.5%
                      LOYALE VIE                      7 239 476                        4.9%
                      SOMA VIE                        6 886 707                        4.7%
                      BENEFICIAL LIFE                 6 638 848                        4.5%
                      STAM VIE                        5 881 118                        4.0%
                      A,A,A VIE                       2 532 097                        1.7%
                      CEA VIE                            402 933                       0.3%
                      Total                       146 751 525                         100%
                     Exchange rate as at 31/12/2008 : 1USD= 454.545 FCFA.

Market shares of the main life companies in 2008

                                   Others 10.5%
                     SOMA 4.7%                                                                 COLINA 23.2%

        LOYALE 4.9%

      LMAI 10.5%

        NSIA 12.5%
                                                                            UA 20.6%

                          AGF 13.1%

Loss ratio per class of business: 2006 - 2008

                                                  2006                     2007                     2008
      Health                                    68.5%                     72.6%                    81.2%
      Motor                                     20.5%                     20.0%                    25.7%
      Fire and property damage                  33.6%                   103.6%                     37.1%
      Third Party Liability                     27.6%                     20.9%                    18.1%
      Marine                                      8.3%                    14.3%                    38.2%
      Miscellaneous accident                    44.7%                     23.2%                    16.7%

                                      Source : Association des Sociétés d’Assurances de Côte d’Ivoire ( ASA-CI)

                                        Atlas Magazine . N° 68 . February 2010

Downward trends of insurance tariffs

U     nexpectedly, the renewal
      of   the     first-of-January
reinsurance treaties has been
                                                               The African market :
                                                                   The decrease of the premium volume makes
carried out with a general                                     reinsurers worry. The slowdown of economic
tendency to liberalize tariffs.                                activities has resulted in a decrease of the marine
The upward movement noticed                                    cargo      premiums      and    a  stagnation    of
at the start of 2009 in Europe, in                             construction-related risks.
April in Asia and in July in the                               Quite often, insurers have benefited from the
United States, has come to an end in January 2010.             competition between the reinsurers in order to
The trend is, rather, toward the reduction of prices in        obtain advantageous renewal conditions. Despite
most classes of business. However, some disparities            an extremely difficult framework, some reinsurers
among markets as well as targeted increases in                 managed, nonetheless, to impose some tariff
some countries are noticed.                                    increases especially with ceding companies
In fact the talks held in January 2010 have taken              sustaining a high loss experience.
into account a balanced supply-demand system in
the United States as well as in Europe.                        The Middle Eastern market :
                                                                  The ‘business as usual’ formula is the concern. It
The American market :                                          translates into one single word: decrease. Neither
    In the United States, tariffs shrank by 6% for             the international crisis, nor Dubai’s hardships have
natural catastrophes and by 10% for property                   managed to reverse the market’s downward trend.
insurance. Motor has reported, however, a stable               The rate of property risks has reached decreases of
trend.                                                         unprecedented levels. Competition among insurers
                                                               and the overcapacity of reinsurers have weighed
The European market :                                          down the 2010 renewal conditions.

    Renewal conditions have been firmer in Europe              The reasons behind such a trend
due to the rise of the loss experience in 2009. Yet,
reinsurance tariffs could only follow the general              reverse
trend reporting decreases in some classes of
                                                                 This general moderation of reinsurance rates is
                                                               accounted for by :
    As to natural catastrophes, decreases have
amounted to 10%. They reached 5 to 10% in the                    ► a mild cyclonic season in the Atlantic (Gulf of
United Kingdom and an average 5% in continental                    Mexico and the Caribbean). The economic
Europe. Only French and Austrian markets reported                  losses related to natural catastrophes
significant tariff increases. In France, some                      remained relatively low in comparison with
reinsurance programs have posted increases of                      2008. These losses dwindled from 200 billion
about 10%. This reinsurance price rise is accounted                USD in 2008 down to 50 billion USD in 2009,
for by the high loss experience triggered by storm                 while insurers’ losses amounted to 22 billion USD
Klaus which cost insurers 3.5 billion USD.                         in 2009 compared to 50 billion USD in 2008;
More substantial surcharges, between 20% and 30%                 ► the reinsurers’ excellent performance in 2009;
have been noticed on the Austrian market, crippled
                                                                 ► the reinsurers’ tough resistance to the financial
by considerable hail storms during the recent four
years.                                                             crisis from which they came out with abundant
    Unlike cross-Atlantic markets, the European                    funds and a large capacity;
motor market, whose loss experience has been                     ► a decline in reinsurance
worsened in 2009, has witnessed a tariff increase                  demand.
amounting to 10%.
    However, in Europe, commercial and industrial              The combination of such
risks have benefited from soft underwriting                    factors has generated more
conditions.                                                    capacities on the market as
    In Europe as well as in the United States, some            well   as   an   excess    of
aviation rates have reported significant rises while           competition among reinsurers.
the decrease in the marine class of business is
estimated at 5%, with especially substantial
increases in capacities.

                                         Atlas Magazine . N° 68 . February 2010

Credit insurance
S    ince the 19th century, companies have realized
     that the growing use of credits represented an
important commercial risk. Solutions to the problem
                                                                   Credit insurance enables the insured (vendor) to
of unpaid bills, started to emerge. One of the                 be covered against definitive loan losses due to the
successful theories is that of Sanguinetti who                 client’s (purchaser) insolvency. The purchaser’s
published in 1839 a survey whose objective was to
                                                               default could result from commercial risks or even
adapt non-life insurance to the risks of defaulting
                                                               political ones due to the recourse to export credit.
   In Europe, the first techniques pertaining to credit        The commercial risks for which the insurer provides
insurance were set up                                          guarantees are generally related to the purchaser’s
between the two wars.                                          non-compliance with payment deadlines and
But they really took off just                                  insolvency.
by the end of the 1970s.                                       Political risks result from non-settlement of contracts
The development of                                             or of export projects following measures or situations
credit    insurance      goes                                  which keep importers from receiving goods or
hand in hand with the                                          which prevent exporters from receiving payment.
growth of international                                        Such failures may be accounted for by a conflict, a
trade.                                                         war, a withdrawal of license or a governmental
                                                               decision. Private insurance companies in general
Introduction                                                   protect the insured against short-term risks
    In the OECD countries, 70% of companies are                extending from two to four months. Quite often,
said to be confronted with outstanding payments.               these risks jeopardize the sale of consumer goods or
Credit sale exposes sellers to risks of non recovery of        raw material.
debts. For non-financial companies, outstanding                Long-term credit risks are often covered by
sums are in average established at 35% of all assets.          state-owned insurers. These risks may last for a
Delays and non payments account for 25% of                     period up to five years. Financial assets are covered
bankruptcies. This rate is even higher for the                 on medium-term bases. Yet these risks remain
companies with less than two years of existence.               relatively scarce.
Credit insurance is then a particularly useful tool
against payment failures. In average, 1.38% of the
annual turnover of a given company may be
preserved by underwriting credit insurance.
Due to political, economic, situations and to the
different trade regulations, non-payment risks still
remain even greater when it comes to international
    Credit insurance differs from surety insurance.
The latter entitles the insured to obtain
compensation in case the government or a
national company fails to honor its payment. As
regulatory baselines differ from country to country,
surety insurance is, therefore, not the same in
distinct markets. That is not the case of credit

                                                                                          .   .           .

                                         Atlas Magazine . N° 68 . February 2010

Advantages of credit insurance                                  cover the insured against default by a big number
                                                                of purchasers which may jeopardize the balance of
Credit insurance allows the insured not only to                 the company. Natural catastrophes are the risks
benefit from advice of experts but also to:                     which trigger the guarantee. This cover is mostly
  • avoid lack of liquidity resulting from purchasers’          granted to big companies endowed with an
                                                                internal system for credit monitoring.
  • diminish results volatility;                                Policies covering political risks :
  • provide access to funding. Banks often link the
    granting of loans to the requirement of                     This risk occurs when governmental measures
    underwriting a credit insurance: 49% of                     interrupt the execution of a contract or prevent the
    companies having credit insurance obtain bank               purchaser from honoring his payment obligations.
    loans, versus 34% for the non-insured;                      Wars or periods of internal instability within a country
  • expand the client portfolio of the insured                  may also trigger such risks.
    towards purchasers who pay only on credit;
                                                                Policies covering monetary risks :
  • transfer default payment from the insured to the
    insurer.                                                    These risks include exchange risks and transfer risks.
                                                                Exchange risk happens when on the day of
                                                                encashment the rate of the foreign currency used
The different types of policies                                 for payment is below the rate used as a basis when
                                                                the guarantee was granted. Transfer risk occurs
Policies based on the overall turnover :                        when economic problems, political events or the
                                                                legislation of the purchaser’s country no longer
They are the most common. They cover all the
insured’s debts. In order to avoid anti-selection, the          allow or delay the transfer of due funds.
insured does not have the possibility to choose the
risks that will be covered. That is why they are based          Covered risks
on the total turnover. Unlike the insured, the insurer
may choose to exclude the clients of the insured                A noticed insolvency, that is, the acknowledged
whom he regards to be insolvent, or to limit the                impossibility of the purchaser to pay his debt is
cover for suspicious clients. Policies are often set for        always covered.
a one-year renewable period.
                                                                The presumed insolvency which is the purchaser’s
The premium rate varies according to the exposure
                                                                inability to settle his debt after a period of time
of the insured to the insolvency of their potential
clients. The premiums basis is made up of the                   (often 9 months following the deadline) is equally
provisional turnover declared by the insured.                   covered. However, it can apply only for
Policies always include a deductible. For a                     low-amount credits whose administrative or legal
proportional premium based on the total turnover,               expenses are insignificant.
deductible is set between 10% and 20%. This
deductible is a variable which depends on the
solvency of the purchasers and of the credit cycle.

Policies based on a single account :
This type of policies covers only exposure to a single
given purchaser.

Policies based on specific accounts :
This kind of policies covers only exposure to a group
of defined purchasers.

Event or catastrophe policies :
These policies have high deductibles and often
take the shape of non-proportional covers. They

                                          Atlas Magazine . N° 68 . February 2010

Risks excluded                                                       integrate  indicators    pertaining  to    rating,
                                                                     compensation of financial expenses and forecast of
Are sometimes excluded :                                             payment stoppage.

 •    debt defaults: due to natural catastrophes, civil              Limits per country, business line and
      or foreign wars, terrorism, currency devaluation               client/purchaser
      and exchange rate losses.                                      Credit insurers examine millions of companies
                                                                     throughout the world (45 million for Euler Hermes)
  Are generally excluded:
                                                                     and store this information in their data bases. The
 •    debt defaults resulting from atomic disintegration;            information gathered will allow insurers to rate each
                                                                     company. Most risks (80%) are concentrated in the
 •    some kind of customers: legal or physical                      OECD countries. Insurers will, then, diligently scatter
      entities not   acting     as    commercial                     the risks per business line and per country in order to
      companies, craftsmen or traders;                               reduce the volatility of their portfolio. Small and
                                                                     medium sized enterprises are the favorite for
 •    companies in which the insured is endowed
                                                                     insurers. They have a more or less local activity and
      with a supervisory power;                                      are less exposed to the risk of dishonoring their
 •    the insured’s clients with difficult financial                 obligations.

      situation :
        -   bankrupt companies or firms in cessation of
        -   companies having difficulties to pay the
        -   companies having already been declared
            by the insurer        to    the     insured     as
                                                                     For the insurer, a good risk management also

Risk management by the insurer                                          ► The use of coinsurance:
                          The profitability of the credit                  It makes it possible to scatter the exposure of a
                          insurer depends on the                           policy between several insurers.
                          quality of the evaluation of                  ►Recourse to reinsurance:
                          his exposure and to his
                                                                           Reinsurance is a good means of smoothing the
                          control of the risk portfolio. It
                                                                           frequency and/or the severity of claims. Part of
                          is essential that the insurer
                                                                           the exposure is ceded to the reinsurer. By
                          adjust his overall risk to his
                                                                           smoothing results, reinsurance stands as an
                          shareholders’ equity.                            optimal tool to contain the cost of capital. An
                                                                           insurer who abstains from having recourse to
The insurance policy                                                       reinsurance will need to have more funds to
A good risk management starts with a good                                  be able to honor one’s commitments.
elaboration of insurance policies with:                                    The cession of reinsurance businesses for main
                                                                           insurers is comprised between 40% and 50%.
  •    a limitation of the policy period to a short time;
                                                                        ►Risk transfer through securitization:
  •    fixed guarantee limits comprising yearly
                                                                           These financial products are widely used. They
       restrictions;                                                       enable companies to transfer undesirable risks
  •    appropriate deductibles;                                            to the financial markets and to relieve as such
  •    the use of a rating             model    based      on              its assets. Moreover, companies receive
                                                                           liquidities which correspond to the assets
        sophisticated tools.
                                                                           transferred, which will improve their cash flow.
Pricing                                                                    The financial crisis, whose by products are
                                                                           directly responsible, has triggered today some
The modern quotation models allow reliable
                                                                           mistrust toward securitization.
underwriting. They make it possible to price a wide
range of risks. In addition to statistics, these models

                                               Atlas Magazine . N° 68 . February 2010

  ► The use of key performance indexes to                        shed light on their outstanding debts. The insurer is in
      measure the sector’s trend :                               a good position to detect risks affecting a client/
      Throughout the years, insurers have developed              purchaser, an industry or a State. It is, therefore, in
      indexes which reflect the health of the different          the insurer’s interest to make such knowledge
      businesses and economic sectors. This                      available to his insured.
      approach enables underwriters to accept
      business only in the areas where the index is              The main credit insurers
      good enough.
                                                                 During the 1990s, a powerful concentration
  ► A dynamic management of the limits                           movement had gathered the bulk of business in the
      offered to a client/purchaser :                            hands of three main insurers: Euler Hermes (born
      The insurer may limit the credit of a purchaser,           from the merger of two credit insurers belonging to
      the client of his insurer who is experiencing
                                                                 Allianz), Atradius (whose main shareholders are
      some difficulties.
                                                                 Swiss Re and Credito y Caucion) as well as Coface.
 The monitoring carried out by the insurer enables               These three groups share about 75% of the market.
 the insured to benefit from counseling which will

 Market shares in 2008 (ICISA’s members only)

                                     Mapfre 2.45%
                                                     QBE 1.97%                                            Euler Hermes
                                                                      Others 4.82%
                            AIG 2.59%                                                                     Atradius
                                                                                    Euler Hermes 35.65%
                  CESCE 2.74%                                                                             Coface
                                                                                                          Credito y Caucion
Credito y Caucion                                                                                         CESCE
                                                                                                          AIG *

      Coface 19.64%

                                              Atradius 21.36%

  (*)AIG   is not member of ICISA (International Credit Insurance & Surety Association)

 The overall credit insurance market is estimated at             According to Swiss Re, the regions with growth
 approximately 5 billion EUR in 2008 (7 billion USD).            potential are: Asia 10%, North America 9%, South
 Western Europe remains the cradle of credit                     America and East Europe 8% while West Europe’s
 insurance (75% of business worldwide). In 2015, the
                                                                 annual growth would not exceed 6%.
 total premium volume is poised to reach 10 billion
 EUR (14 billion USD).

                                           Atlas Magazine . N° 68 . February 2010

The main credit reinsurers
The main reinsurers ‘ market shares
                                                                                                     Swiss Re
        Others 33.4%
                                                                    Swiss Re 22%                     Munich Re

                                                                                                     Hannov er Re

                                                                                                     Transatlantic Re

                                                                                                     Partner Re


  Scor 3.6%

Partner Re 4%

       Transatlantic Re 6%                                      Munich Re 21%

                                     Hannov er Re 10%

The main credit reinsurance brokers
Benfield is the biggest broker. The other players are: Guy Carpenter, Aon Re, Willis, Calomex.

        The economic crisis has disrupted the market of
    credit insurance. Short-term risks based on overall                            The overall credit insurance
    turnover have been the hardest hit. According to                                 market is estimated at
    the association of British insurers, the total loss ratio                     approximately 5 billion EUR
    of the British market has leapt by 166% reaching                           in 2008 (7 billion USD). In 2015,
    509.4 million USD in the first quarter of 2009 in                              the total premium volume
    comparison with the same period of 2008. Insurers                          is poised to reach 10 billion EUR
    are reporting that similar trends are noticed                                       (14 billion USD).
    worldwide for short-term credit risks.

                                          Atlas Magazine . N° 68 . February 2010

Insurance news

Botswana                                                      Fanaf. The participants reminded the fiscal
                                                              authorities in the countries concerned that the
The first insurance company                                   decision of the council of ministers dated
                                                              September 28, 2009 implied that no more taxes are
dedicated to agriculture has been                             applied on these premiums.
Agrinsure, a joint venture that was born from a               Ghana
partnership between the South African Farmers
Technical Insurance Services Company (FTISC) and              Gras Savoye has obtained license in
Alexander Forbes Botswana, has been established.              Ghana.
It is the first time that a company dedicated to
                                                              Gras Savoye will be operating insurance brokerage
agricultural insurance is set up in the country.
National programs had already been launched                   in Ghana where the local authorities have just
with a view to supporting farmers but with poor               granted it license. It is the first time that Gras Savoye
results.                                                      gets established in an African English-speaking
Agrinsure will be providing insurance products                country. Already present in 12 sub-Saharan African
covering livestock and crops. Given the limited               countries, in the Maghreb and in the Indian Ocean,
scale of the local market, Agrinsure will be obliged
                                                              the French broker has confirmed its number one
to underwrite business outside Botswana.
                                                              ranking on the African continent.
Adoption of IFRS standards.
                                                              Chartis and Kenya Airways in
The general managers and financial officers of the
African insurance and reinsurance companies                   partnership.
along with auditors and representatives of the                On December 15, 2009,
regulatory authorities will meet in Cameroon next             Chartis and Kenya sealed
March 2 and 3 for a two-day seminar. Attendees will
                                                              an     agreement       which
be debating IFRS utility and the benefits that such a
practice may provide in terms of simplifying                  enables       the     airline
financial reports and accounting procedures.                  company       customers     to
According to some experts, the adoption of the IFRS           benefit    from    a    travel
standards would achieve more transparency for                 insurance plan. This optional
both investors and shareholders.                              cover is currently available
                                                              for travelers departing from
Gabon                                                         Kenya. Passengers will
                                                              benefit from a medical insurance up to 500 000
CIMA: taxation of insurance premiums.
                                                              USD, a 10 000 USD cover against loss of traveler’s
The training and information seminar held in                  baggage and personal effects and a scheme
Libreville to debate the taxation of the premiums             limited to 5 000 USD as flight cancellation fees.
ceded in reinsurance by three of the fourteen Cima
countries gathered fiscal administrations and
national insurance departments of Cima and of

                                        Atlas Magazine . N° 68 . February 2010

Fierce competition on the insurance                            January 1, 2010. They are designed for all players;
                                                               brokers, agents, claim adjusters, insurers and
market pulls prices down.
                                                               reinsurers. By enforcing these rules, NAICOM is
According to experts, insurance premiums are                   hoping to clean up a market that is rigged by
widely underestimated and the going prices are                 fraudulent practices. The Commission also aims at
too low to cover incurred risks. The deterioration of          improving the quality and the performance of the
the market is accounted for by stiff competition               operators.
among local insurers. The lack of control and
regulation is partially blamed for this situation in           Insurers ’profits contracted by reforms
addition to the poor technical capacities of                   introduced.
companies as regards risk assessment.
                                                               With the exception of a few companies, all of the
The insurer APA is offering a cover                            Nigerian insurers closed the 2009 fiscal year with
against political risks.                                       losses. In addition to shrinking profits, the capital of
                                                               the different players have been seriously affected.
APA Insurance has been recently distributing                   The introduction of transparency rules, imposed by
insurance policies covering political risks including          the National Insurance Commission (NAICOM) has
terrorism and sabotage. This cover is offered as a
                                                               put an end to a number of practices deemed
supplement to the motor and property insurance
                                                               illegal but widely in use for many years: inadequate
policies. A reinsurance plan has been established in
association with African Trade Insurance Agency                quotations, commissions falsifications… . The new
(ATI). The latter is likely to benefit from a premium          provisions require insurers to reduce at least by 25%
volume of 31 million KES (429 040 USD) in terms of this        the outstanding premiums and debts of more than
new cover. The violence that ensued the 2007’s                 three months, posted on the balance sheet. These
elections caused claims of 1 billion KES (14. 9 million        will have to be carried forward to loss and profit
USD).                                                          account once the loss has been estimated. The
                                                               deferral of losses posted on the financial markets
Insurers extend their offer to agricultural                    has deepened the deficit to the extent that many
risks.                                                         companies failed to honor the payment of
Seven Kenyan insurers are embarking on                         dividends due to their shareholders.
agricultural insurance. The products proposed apply
to crops, livestock (including poultry and
                                                               Royal Exchange Assurance pays a
crocodiles), drought, hail as well as floods. It is the        compensation of NBC 3.24 billion NGN
second attempt led by the insurers of this sector.             (21.6 million USD).
The first one lasted only from 1987 to 1988 and
                                                               The country’s number one insurer, Royal Exchange
resulted in a failure. Fraudulent claims strained this
initiative triggering substantial losses to the                Assurance, is going to pay the costliest claim in
companies involved in the distribution of those                Nigeria’s history. On December 18, 2008, the claim,
products. Unscrupulous farmers and veterinaries                which occurred in the premises of Nigeria Bottling
plotted to swindle their insurer.                              Company and which was initially estimated at 13.5
                                                               billion NGN (90 million USD), will be finally settled at
Nigeria                                                        6.824 billion NGN (45.5 million USD). Royal Exchange
                                                               Assurance led the policy with a 47% share. Its loss
Clean-up of the Nigerian market.
                                                               share amounts to 3.24 billion NGN (21.6 million USD).
The insurance commissionor, Daniel Fola has asked
insurers to comply with the underwriting guildelines
issued by the National Insurance Commission
(NAICOM). These guidelines are part and parcel of
oversight and regulation tools established since

                                         Atlas Magazine . N° 68 . February 2010

         Senegal                                                                                     Uganda
         The establishment of an insurance                                                           National Insurance Company (NIC),
         cover for the Senegalese artists.                                                           partially privatized.
         The ministry of culture and the Nouvelle Société                                            The Ugandan government is selling its share in NIC
         Interafricaine d’Assurance (NSIA) are intent on                                             capital to private investors. The price is set at 45
         setting up a social and medical cover for the                                               UGX (0.023 USD) per share and 40% of the capital is
         benefit of artists during the first semester of 2010. The                                   poised to be sold. This move ended in February 5.
         plan, which includes several schemes, is providing a                                        It is the twelfth company to be listed on the
         medical cover from 5 000 000 FCFA (10 950 USD) up                                           Ugandan market. The remaining 60% of the capital
         to 15 000 000 FCFA (32 850 USD) for contributions                                           are held by the Nigerian company Industrial and
         varying from 5 000 FCFA (10.9 USD) to 200 000 FCFA                                          General Insurance (IGI).
         (438 USD). Top-of-the-range formula proposes the
         expatriation of the insured to medical centers
         located in the Maghreb or in Europe.

      ‘‘Africa Re has established a leadership position as a regional
      reinsurer committed to Africa, and now opened to selective markets
      in the Middle East and Asia’’

                                      African Reinsurance Corporation
                                        THE AFRICAN REINSURER:
                                                  African Focus, International Standards
                                                                                  ALSO MANAGES THE:
                                               • African Oil & Energy Pool • African Aviation Pool
                                                                                      AFRICA RE HOUSE
                                                      Plot 1679, Karimu Kotun Street, Victoria Island P.M.B. 12765 Lagos, Nigeria
                                                                     Tel: (2341)2663323/2626660-2/4618828
                                                                          Fax: (234 1) 2663282/2626664
                                                                                      e-mail: info@a

                                                                                         www .africa-re .com
                                                                                     S&P rating A-, AM Best A-

                                                                   Regional Offices                                                                     Subsidiary

   33, Boulvard Moulay                Africa Re Centre                   Rue Viviane             1 Cathedrale square    38C Mansour Street          African Reinsurance Corporation
           Youssef                      Hospital Road           A24-Cocody Ambassade               Mezzanine Level                Cairo, Egypt            (South Africa) Limited
         Casablanca                       Upper Hill                    20 BP 1623              Cnr Pope Hesseny Str & Tel: (20-2) 7924020
                                                                                                                                                    3rd Floor, North Wing Oakhurst
                                   P O Box 62328 00200                                                                                                            Building
           Morocco                                                       Abidjan 20               Georges Guibert              41804190                  11-13, St. Andrew's Rd
                                          Nairobi                     Cote d'Ivoire               Str, Port-Louis
    Tel: (212) 22437700                    Kenya                                                                        Fax (20-2) 7924030                   Parktown 2193
           2306154                                                Tel: (225) 22404480/1              Mauritius.       e-mail:            Houghton 2041
                                            Tel: (254-20)                                           Tel: (230) 2100795
         Telex: 28079M                     2730660/1/2/3
                                                                 Telex 22345 AFRICACI                                                                         Johannesburg
                                                                   Fax (225) 22404482                   (230) 2131667                                           South Africa
     Fax: (212) 22437729                   Fax: (254-20)                                                (230) 2131689                                      Tel: (27-11)4843764
email:         2724896/2730608         e-mail:
                                                                                                   Fax: (230) 2102496                                     Fax: (27-11)4841001
                                  e-mail:                                 e-mail:                        e-mail:

                                                                         Atlas Magazine . N° 68 . February 2010

China                                                         Japan
Natural catastrophes have claimed                             AM Best confirms the financial
the lives of 1528 people in 2009.                             soundness of Nippon Life Insurance.
Natural catastrophes have hit China hard in 2009              AM Best has granted an A+ rating to Nippon Life
causing the death of 1 528 people and more than               Insurance, Japan’s number one life insurer. The
37 billion USD of damages. Natural events have                agency has also downgraded the insurer’s credit
affected a total of 480 million Chinese and obliged           rating from “AA” down to “AA-” with stable outlook.
the authorities to evacuate 7 million persons. The            AM Best justified this rating by the continuous
harsh wintery conditions and the droughts have                deterioration of the insurer’s capitalization which
partially or totally destroyed approximately 50               has been seriously hit by the crisis in the recent two
million hectares of farmland.                                 years. The solvency margin has been depreciated
                                                              falling from 1325% in 2006-2007 down to 904% in
India                                                         2008-2009.

Big growth of health insurance.                               Taiwan
Health insurance has grown by 30% between 2008                BNP Paribas Assurance in life
and 2009 reaching 66.25 billion INR (1.4 billion USD)
by the end of 2009, compared to 51.25 billion (1.04
                                                              insurance business.
billion USD) in the previous year. It ranks second on         The    Financial     Supervisory   Commission   has
the market in terms of premium volume (22%)                   authorized BNP Paribas Assurance to establish a life
behind the motor class of business (40%). In addition         insurance joint venture in partnership with Taiwan
to public awareness, the growth of this segment is            Cooperative Bank. This entity will become the
owed to the central and federal authorities who               island’s thirty-second life insurance company. BNP
have set out large-scale health insurance schemes.            Paribas Assurance will have control over 49% of
                                                              shares while the national company will control 51%.
Indiabulls and Sogecap end their joint                        Endowed with a capital of 63 million USD, the new
venture agreement.                                            company plans to level off in two or three years.
                                                              BNP Assurances is already operational in life
For undisclosed motives, Indiabulls and Sogecap               insurance in Taiwan under the name of Cardif.
have cancelled their joint venture agreement. Both
companies had announced their life insurance                  Vietnam
partnership in April 2008.
Indiabulls Financial Services obtained green light            Foreign insurers are developing life
from Reserve Bank of India to detain 74% in the new           insurance.
entity’s stakes, while Sogecap, a subsidiary of
Société Générale held 26%. Indiabulls is prospecting          Foreign insurers are experiencing significant growth
the possibility of going solo with the move but does          on the Vietnamese life market. This growth is
not discard the option of resorting to a new partner.         accounted for by the poor penetration rate of
Indian insurers highly exposed to                             insurance in Vietnam and by the large population
                                                              (86 million inhabitants). Ace Life Vietnam has posted
terrorism risks.                                              a premium growth rate of 150% in the course of the
The terrorist claims reached 5 billion INR (106.9             first quarter of 2009. Likewise for the other players
million USD) over the 2008-2009 period following              such as Dai-Ichi Vietnam and Korea Life. The
attacks targeting renowned hotels. This abrupt                country currently has 11 life insurers including
increase stems from damages sustained by Taj                  Bao-Viet which controls 32% of the market shares.
Mahal Palace, Oberoi Hotel and Trident Hotel,                 Life insurance companies are mostly owned by
which alone account for 42% of the total amount               foreign capitals. The minimum capital required to
due by insurers. Taj Mahal, insured by Tata AIG, is
                                                              establish a life insurance company is 32.5 million
paying roughly 1.5 million INR (32 085 USD) for its
                                                              USD, which stands as an impediment for local
terrorism cover. This sum amounts to 1 million (21 390
                                                              investors. Bao-Viet is a company with Vietnamese
USD) for hotel Oberoi and to 0.6 million (12 834 USD)
for Trident Hotel. Since 2002, Indian insurers have
been pooling up to cover acts of terrorism.

                                        Atlas Magazine . N° 68 . February 2010

Algeria                                                         solidarity fund designed to compensate victims of
                                                                terrorism acts or of natural catastrophes who are
Insurance against agricultural                                  not insured against such risks. Moreover, the bill
calamities.                                                     provides for the introduction of a natural
                                                                catastrophe cover in all non-life insurance policies
The minister of agriculture and rural development               that are distributed nationwide.
has announced the establishment of advisory
offices in charge of boosting insurance operations              UIB is renewing Royal Air Maroc
and rural credit. Similarly, the Conseil National des           insurance policy.
Assurances (CNA) is studying the possibility of
                                                                UIB has been designated as the leading broker for
introducing an insurance scheme against
                                                                the placement of Royal Air Maroc fleet. This
agricultural calamities (“DACA”). This survey is
                                                                decision consolidates the presence of UIB in the
conducted in association with the regulatory
                                                                aviation sector in North Africa and unveils the
authorities, insurers, reinsurers, farmers and experts.
The legal texts will be finalized in the course of 2010.        broker’s intentions as regards the rest of the
                                                                continent. UIB is also placing Air Algérie policy.
CNMA is launching new agricultural                              Royal Air Maroc is endowed with a fleet of 71
products.                                                       aircrafts estimated at 1.5 billion USD.

“Multi-peril vineyard” and “Multi-peril olive trees”
are the two new insurance products, distributed by              Tunisia
the Caisse Nationale de la Mutualité Agricole
(CNMA). These policies provide grape producers
                                                                Tunis Re is getting listed.
and olive growers with a cover against climate risks,           Tunis Re is getting listed
namely hail, freeze, sirocco, storms and floods.                during the first quarter of
                                                                2010. To prepare for this
Morocco                                                         move, a capital increase
                                                                has been decided by the
Legal cession.                                                  extraordinary general
Started in 2007, the dismantlement of the legal                 assembly of January 12,
cession is still going on. As of January 1, 2010,               2010. The current capital
insurance companies will no longer cede 10% of                  of 35 million TND (27 million
their direct premiums to the Société Centrale de                USD) will be raised to 45
Réassurance (SCR). The gradual suppression of this              million TND (34.8 million USD). In 2008, Tunis Re
legal cession shall be extended to other insurance              reported a turnover of 59.7 million TND (46.8 million
classes of business in 2011. The legal cession is due           USD) and a net profit of 5 million TND (3.9 million
to completely disappear by the end of 2012.                     USD). Its shareholders’ equity amounts to 51.5 million
Roundtable on the bill relative to                              TND (40.3 million USD) while its 2008 ROE is
natural catastrophes.                                           established at 10%. The combined ratio is of 95%.

On the initiative of the government’s secretariat
general, a roundtable has been held on the bill
amending and supplementing the insurance code.
This new project is instituting the establishment of a

                                          Atlas Magazine . N° 68 . February 2010

Bahrain                                                         Qatar
Bahrain is hosting an insurance forum.                          Generali and Qatar Insurance Bank
The 2010 Middle East Insurance Forum has taken                  are about to launch a joint venture.
place on February 6 and 7, 2010 in Manama. The                  The Italian insurer Generali and Qatar Insurance
topics addressed during the conference pertain to               Bank (QIB) are prospecting the establishment of a
the international crisis as well as to the new risks and        takaful insurance company.
opportunities on the Middle Eastern market. The low             A preliminary agreement has
insurance penetration rate in the region will also be           been signed which provides
on the agenda.                                                  for the use of Generali’s
Among the speakers were, Jean-Louis Laurent Josi,               technical resources and QIB’s
Chief Executive Officer of Axa Insurance Gulf,                  know how and distribution
André Arrago, chairman of Hannover Retakaful                    capacities.      The      new
Bahrain and Robert Peilow, managing director of                 company will be inspired
Willis for the Middle East.                                     from Beema’s experience,
The insurance company Legal General                             the     takaful     insurance
                                                                company of which QIB is
Gulf Takaful B.S.C. is launched.                                shareholder.
Legal General Gulf
Takaful is a joint
                                                                SEIB Insurance & Reinsurance obtains
venture stemming                                                license in Qatar.
from the partnership                                            SEIB, a newly established Qatari company, has
between British Legal
                                                                announced having obtained license from the
& General and Ahli
United Bank (AUB). The                                          regulatory authorities at the end of October 2009 to
new company will be                                             carry out insurance and reinsurance operations in
underwriting insurance                                          Qatar. The company stems from a joint venture
policies which will be                                          between H.E Shiekh Jabor Bin Yossef Bin Jassim Al
distributed through                                             Thani and Chedid Capital Holding, a regional
AUB     agencies     in
                                                                investment company partially held by Euromena.
Bahrain and subsequently in other regions in the
Gulf. Legal General Gulf Takaful will offer life
insurance products in conformity with the sharia.
                                                                Saudi Arabia
The best 2009 Takaful operators                                 ACE enters the Saudi market.
elected by CPI Financial.                                       SAMA (Saudi Arabian Monetary Agency) has
CPI Financial has held the ceremony rewarding the               granted its approval to the insurer ACE Arabia to
best 2009 Takaful operators for the fourth                      operate in Saudi Arabia. The company has been
consecutive year in Bahrain. A total of 27                      present on the market since 1973, in association
companies      and      individuals   have       been           with Elkheriji Group. In April 2009, ACE Arabia
distinguished. The main rewards have been
                                                                Cooperative Insurance Company got listed with a
attributed to Dubai Islamic Bank for the best Islamic
bank, Noor Takaful for the best Takaful insurer and             capital of 26.6 million USD, 40% of which is offered to
Hannover Retakaful for the best Takaful reinsurer.              the public. For ACE, the license obtained marks the
                                                                last stage of the integration process on the market
Takaful Insurance Company has won                               as a local player.
an important tender.
For the consecutive year, Takaful Insurance
Company has won the tender for insurance
coverage of ministerial risks and those of
governmental organizations. Nine companies took
part in the tender which comprised insurance
coverage of various risks in several classes of
business, worth 729.5 million USD.

                                          Atlas Magazine . N° 68 . February 2010

ACIG increases its capital by 150%.                           January 17 permits the 23 branches of Sharjah
Allied Cooperative Insurance Group (AGIC) is                  Islamic Bank throughout the country to distribute
                                                              insurance contracts with simplified underwriting
expecting authorization from the central bank and
the stock market authorities to proceed to its
capital increase by 150%. The new capital will,               Captive insurance companies are
therefore, attain 66.7 million USD. The company is            growing in Dubai.
hoping to finalise the move before the end of the             Given the high number of large local and
first quarter 2010 and make profits by 2011.                  international firms established in Dubai Financial
                                                              Center, captive insurance companies are poised to
United Arab Emirates                                          report a swift growth. Dubai Holding and Mubadala
Global Corporate & Specialities                               are among the first companies to set up such
                                                              operations. Other applications are underway.
(AGCS) is getting established in Dubai.
                                                              Companies paying insurance premiums of at least
AGCS, Allianz‘s underwriting agency of large risks, is
opening a branch in Dubai. Employing 17 staff                 1.5 million USD are perfect candidates. Such a
members, the branch will be proposing to its                  scheme may be achieved by establishing a
regional customers the overall services and                   specialized division within the parent company or
products that AGCS is offering worldwide.                     by outsourcing the management of the captive
Sharjah Islamic bank and Noor                                 insurance company. The Emirates do not have a
                                                              framework governing this type of activities, hence,
Takaful sign a strategic agreement.                           the need to establish the operation in other
Sharjah Islamic Bank’s clients can underwrite motor           countries such as Bahrain, Qatar, Bermuda, the Isle
insurance policies of Noor Takaful at preferential
                                                              of Man or Malaysia.
rates. The agreement signed by both parties last

                                        Atlas Magazine . N° 68 . February 2010

France                                                          Switzerland
Axa is taking control of a life insurer                         Takeover rumors on Swiss Life.
in Rumania.                                                     The shares of Switzerland’s number one life insurer
By gaining control of Omniasig Life, Axa has set foot           have experienced high exchange volume, well
in life insurance in Rumania. The French insurer                above the average standards following rumors
estimates that this market has very promising                   relative to its takeover by Allianz. According to
potential. Set up in 1997, the company has                      information site Wansquare, citing Swiss banking
specialized in the distribution of employees’ benefits          sources, Allianz would be about to launch a
insurance. Today, it has a network of 1400 agents. Its          takeover tender on the basis of 5.5 billion CHF (5.2
premium volume has reached 12 million EUR (16.9                 billion USD).
million USD) in 2008. The move has to be approved
by the regulatory authorities by the end of the first           The Netherlands
semester of 2010.

The operators of the French market                              ING confirms the sale of its reinsurance
condemn Solvency II.                                            operations in the United States.
Similarly to the protest of the British professionals in        By ceding its reinsurance activities in the United
2009, the majority of the French insurers and                   States to Reinsurance Group of America (amount of
reinsurers have voiced their condemnation of the                transaction being undisclosed), ING has paid up a
rules imposed by Solvency II and which will be in               capital of 100 million EUR (141 million USD) in 2010.
force as of 2012. The French professionals blame                Expected since October 2009, this move follows the
Solvency II for contributing to short-term risk taking          sale of numerous assets in recent weeks. The
and for penalizing long-term risks. According to the            pursued goal is the refund of the 10 billion EUR (14
new measures, solvency requirements will be                     billion USD) loan provided by the Dutch State at the
imposed on an annual basis, which will push insurers            end of 2008. So far, ING has repaid 5.6 billion EUR
to increase their shareholders’ equity unreasonably.            (7.8 billion USD). The company has also proceeded
On his part, FFSA’s chairman, has denounced the                 to a capital increase of 7.5 billion EUR (10.5 billion
exclusion of pension funds from the scope of the                USD).
directive, which put French insurers in an
uncomfortable position in comparison with their                 United Kingdom
Anglo-Saxon counterparts.
                                                                Prudential is being reinforced in Asia.
Return on life insurance contracts set
to decline.                                                     Britain’s first insurer, Prudential, has disbursed 213
                                                                million EUR (308.9 million USD) to take control of the
Standard & Poor’s is expecting a drop in the return
                                                                life insurance subsidiary of Singapore United
of life insurance contracts. Despite the crisis, the
                                                                Overseas Bank (UOB). Prudential has also reached a
latter remained at important levels nearing 3.90% in
                                                                twelve-year agreement with UOB which will be in
average for the contracts issued in Euros in 2008.
                                                                charge of distributing the English insurer’s products
Yet, despite the recovery of the financial markets,
                                                                via its branches in Indonesia, Thailand and
the situation has been different in 2009: interest
                                                                Singapore. This initiative is likely to enable Prudential
rates have evolved, competition on passbooks has
                                                                to better deal with competition from AIA, AIG’s
dwindled while insurers are seeking to increase their
                                                                subsidiary, Great Eastern, subsidiary of the
reserves. These factors are contributing to the
                                                                Singaporean bank OCBC. In 2008, Prudential
decrease in the rates used in 2009.
                                                                achieved 44% of its profits in Asia.

                                          Atlas Magazine . N° 68 . February 2010

         The Omani insurance market in 2008
         Direct premiums per company and per class of business in 2008
                                                                                                                             Figures in USD
                        Motor          Property      Marine        Others          Total          Life         Grand       Market  Growth
                                       damage                                     non life                      total      shares 2008-2007

                                                            National companies
Dhofar Insurance
                       56 085 140      31 687 047   13 516 960    13 768 232    115 057 379      7 275 004   122 332 383    22.5%         2.9%
Oman United
                       39 368 032       3 478 210    4 846 225     8 494 485     56 186 952     27 714 560    83 901 512    15.4%       23.8%
Al Ahlia Insurance
                       33 357 295       9 324 247    6 986 832    14 451 048     64 119 422      1 330 219    65 449 641    12.0%       48.5%
National Life
                       15 895 379         154 118       26 348       557 830     16 633 675     33 964 666    50 598 341     9.3%       96.3%
Royal & Sun
                       11 072 990      11 046 284    3 468 204     1 591 081     27 178 559        -          27 178 559     5.0%         4.2%
Alliance Insurance
Al Madina Gulf
                       16 456 728       3 730 754      493 473     3 956 890     24 637 845      1 198 217    25 836 062     4.7%      167.1%
Oman & Qatar
                        9 375 858       4 483 962      822 741     1 133 941     15 816 502         -         15 816 502     2.9%         5.2%
Muscat Insurance        2 860 880       8 985 909    1 399 673     2 043 014     15 289 476         -         15 289 476     2.8%         0.7%
Muscat Life
                          -                -            -              -              -         14 115 970    14 115 970     2.6%       30.1%
Falcon Insurance        3 986 540       3 731 849    1 119 805     4 292 139     13 130 333         77 416    13 207 749     2.4%        -9.5%

Vision Insurance        6 339 102         485 022       53 151     1 714 948       8 592 223           -       8 592 223     1.6%             0%

 Total                194 797 944      77 107 402   32 733 412    52 003 608    356 642 366    85 676 052    442 318 418    81.2%       27.1%

                                                            Foreign companies
New India
                        18 162 998     2 502 663     4 590 089     9 089 098    34 344 848          -         34 344 848     6.3%       21.9%
Axa Insurance            8 532 245     2 532 064     2 699 526     6 129 914    19 893 749       1 822 727    21 716 476     4.0%       31.5%
American Life
                           -              - 1 623       -          1 875 131      1 873 508     15 896 532    17 770 040     3.3%       -13.8%
Arabia Insurance        10 354 149       490 326    1 048 098      2 576 043    14 468 616        854 696     15 323 312     2.8%       31.6%
AIG Memsa For
                           -             308 291        -          5 795 591      6 103 882        -           6 103 882     1.1%             0%
Life Insurance
                           -               -            -              -             -           3 202 132     3 202 132     0.6%       32.1%
Corp Inter
Al Nisr Insurance        2 215 539        70 241       121 486       704 786      3 112 052        -           3 112 052     0.6%         1.2%

Iran Insurance                15 987     480 918        30 828        13 263        540 996        -            540 996      0.1%       12.4%

Total                  39 280 918      6 382 880     8 490 027    26 183 826    80 337 651     21 776 087    102 113 738    18.8%       23.1%

   Grand Total        234 078 862      83 490 282   41 223 439    78 187 434    436 980 017    107 452 139   544 432 156     100%       26.4%

Exchange rate as at 31/12/2008 : 1 USD = 0.38257 OMR ; as at 31/12/2007 : 1 USD = 0.38359 OMR

                                                      Atlas Magazine . N° 68 . February 2010

  Market shares per company in 2008
                                                                  ( 1)
                                     Other companies 17.5%

       American Life Insurance 3.3%                                                                           Dhofar Insurance 22.5%

                Axa Insurance 4%

  New India Insurance 6.3%

             Al Madina Gulf 4.7%                                                                       Oman United Insurance 15.4%

       Royal & Sun Alliance 5%
                                   National Life 9.3%                     Al Ahlia Insurance 12%

  (1) Ten   companies

  Breakdown per class of business: 2008-2007
                                                                                                                     Figures in USD

                                   Premiums 2008             Market shares 2008               Premiums 2007    Market shares 2007

Motor                                 234 078 862                         43%                   167 829 435              38.9%
Property damage                        83 490 282                        15.3%                   80 877 824              18.8%
Marine                                 41 223 439                         7.6%                   31 150 981               7.2%
Others                                 78 187 434                        14.4%                   68 415 547              15.9%
Total Non life                        436 980 017                        80.3%                  348 273 787             80.8%
Life                                  107 452 139                        19.7%                   82 595 169              19.2%
            TOTAL                     544 432 156                        100%                   430 868 956              100%
Exchange rate as at 31/12/2008 : 1 USD = 0.38257 OMR ; as at 31/12/2007 : 1 USD = 0.38359 OMR

  Market shares per class of business in 2008

                                        Life 19.7%

               Others 14.4%

                                                                                                                Motor 43%

              Marine 7.6%

                              Property damage 15.3%

                                                     Atlas Magazine . N° 68 . February 2010

    Congo                                                        Kazakhstan
    34th FANAF annual general assembly.                          6th International risk management
    From 7 to 11 February 2010, Kinshasa, Democratic
                                                                 Organised by Eurasia Insurance Company, the 14
    Republic of the Congo.
                                                                 and 15 April 2010, in Almaty, Kazakhstan.
    Theme : « The growth strategies of national                  Tel : +7 (727) 258-43-36
    insurance markets in the FANAF »                             Fax : +7 (727) 266-31-94
    Website :                                      Email : /
                                                                 Website :

    United Arab Emirates                                         France
    5th Annual world takaful conference                          2nd Marine insurance rendez-vous.
    (WTC 2010).                                                  The 4 and 5 May 2010, Cannes, France.

    The 12 and 13 April 2010, Dusit Thani Dubai, United          Jordan
    Arab Emirates.
    Theme : « Islamic insurance : managing risk, driving         28th GAIF Conference, General Arab
    growth. »                                                    Insurance Federation.
                                                                 From 17 to 19 May 2010, King Hussein Convention
                                                                 Center, Dead Sea, Jordan.
                                                                 Theme : « Arab insurance industry : secured
                                                                 economy, comprehensive development ».
                                                                 Website :

                                                   CICA - RE
                Compagnie Commune de Réassurance des Etats Membres de la CICA
                               Website :
●   Underwriting all classes of business
●   Retrocessions and exchange with partners from Africa, Asia and the Middle
●   Technical assistance to cedants

                   A reinsurer, whom you can rely on
     Head Office                                                               Douala Branch Office
     BP 12410 Lomé -                                                           BP 1176 Douala-Bonanjo -
     TOGO                                                                      CAMEROUN
     Tel : (228) 221 62 69 - 221 63 88 - 222 28 69                             Tel : (237) 342 34 37
     Fax : (228) 221 49 64 - 221 28 46                                         Fax : (237) 342 34 23
     Email :                                               Email :

                                           Atlas Magazine . N° 68 . February 2010

Bahrain                                                          United Arab Emirates

Royal Sun Alliance (RSA). Rakesh Nayar                           Nexus.         Rumi M.Sanjana has joined Nexus as
has been promoted Chief executive Officer of the                 manager of general insurance. He had previously
company. R.Nayar was in charge of the sales and
                                                                 been CEO of Vita International Insurance Brokers
distribution operations in RSA in the United Arab
Emirates.                                                        and has a 32 years’ insurance experience in the
                                                                 United Arab Emirates.
                                                                 Takafulhous.         Ayman Yousif Al Ajmi has been
Zurich       Global       Corporate          France.             nominated Chief Executive Officer of Takafulhous,
Isabelle Jacquot has been nominated as property                  the subsidiary of Mawarid Finance. AY. Al Ajmi
manager. David Fineberg is entrusted with the                    began his career with Norwich Union Insurance and
management of the claims department whereas                      for Dubai Islamic Insurance & Reinsurance (AMAN)
Coralie is in charge of the third party liability claims.
                                                                 before joining AIG Takaful Enaya Bahrain in 2006.

South Africa                                                     ADNIC.         Abu Dhabi National Insurance (ADNIC)
Old Mutual.           Patrick O’Sullivan has been                has designated Benjamin Graham chief risk officer.
appointed chairman of Old Mutual’s board of
directors. He has taken over Chris Collins who has
retired. Before joining Old Mutual, Patrick O’Sullivan
had been entrusted with executive duties within
Man Group, Bank of Ireland, Collins Stewart and
Zurich financial Services Group.

                                           Atlas Magazine . N° 68 . February 2010

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