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With AfCFTA, developing insurance market across Africa is no longer a choice

Given the role of insurance in helping develop economy, Africa no longer has a choice particularly with the signing of the African Continental Free Trade Agreement (AfCFTA), Sunday Thomas, commissioner for Insurance, Nigeria said.

Thomas said growth potential in insurance is not only in Nigeria, but all over Africa and so we must unite and develop insurance business.

“The signing of the Africa Continental Free Trade Agreement (AfCFTA) has provided an avenue to foster unity and integration within the Africa region. It provides an avenue for achievement of a common market for goods and services; guaranteeing free movement of human resources, investment and technology”.

Thomas, therefore charged the new leadership of the African Insurance Organisation (AIO) to vigorously persuade the governments across the continent to play their roles in providing the necessary support, creating an enabling environment for insurance activities to flourish.

He said continued lifting of border barriers, promotion of healthy competitions amongst member states and promoting knowledge sharing across the continent among other objectives will make insurance business thrive within the African markets.

He also charged the newly sworn-in President of the AIO, Tope Smart, who is also the managing director of NEM, that by the year 2022 the AIO will celebrate its Golden Jubilee (50 years) being established in 1972 which means he can also write his achievements in gold for coming on board at this critical time.

Read Also: Insurers outline strategies to harness growth opportunities in AfCFTA

“We expect to see great stride and landmark achievements when your tenure is over and the baton will change hands. I pledge the support of the Nigerian insurance industry to your success as President of the AIO”, he added.

Grace Muradzikwa, commissioner of Insurance, Pension and Provident Funds, Zimbabwe, Grace Muradzikwa while presenting a paper on, “Regulation, Innovation and the Future of Insurance” at the AIO Conference sought collaboration with other regulators across the continent.

Highlighting in-country and across jurisdictions, she maintained that the lowering of barriers has highlighted the interconnectedness of markets and the need for regulators to collaborate and eliminate regulatory arbitrage.

In Zimbabwe, she said, they now have the Smart Regulators Forum where regulators meet to discuss cross cutting issues.

Speaking on data protection and privacy, she said: “Regulators are concerned about how insurers are managing potential customer risks related to data sharing with third parties, therefore, developing data protection frameworks and collaborating with data protection agencies.

Read Also: Insurers want regulatory integration to optimize benefits of AfCFTA

“On new sources of growth, one of the things I was taught when I joined the Insurance industry many years ago was that there is a strong positive correlation between insurance growth and economic growth though the causality relationship can be bi-directional. It is a chick and egg relationship. There is a lot of empirical evidence on the nexus between economic development and the development of the insurance industry. In my view, it is for this reason that insurers must not only take an interest in the economic growth drivers but be agents of economic growth. This is the only way that insurance will contribute towards the rebuilding of the continent.

“The world is now a global village, and very soon the AfCFTA will result in removing physical trade borders on the continent. It is coming and we must plan for enhanced cross border trade in insurance services, which is certainly expanding its scope beyond reinsurance as the only traditional cross border product”, she noted.

The newly sworn-in president of the AIO, Smart who is also the Managing Director of NEM Insurance Plc in his acceptance speech said his one year in office will focus on five major objectives targeted at repositioning the African insurance market.

He listed these areas to include increased awareness; adoption of digitalisation; collaboration with other markets; partnership with government and regulators and building customer’s trust.

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