Dubai-headquartered carrier IGI is building out it’s presence in Africa, Youssef Alaoui chief executive officer of IGI Casablanca has said.
Speaking to Re-Insurance ahead of this year’s Monte Carlo Rendez-Vous, Alaoui said the Group’s focus right now is to further develop IGI’s Casablanca operation as “the surface has barely been scratched”.
Alaoui said that by having an operation in Africa, IGI is able to access smaller-scale business it hasn’t previously written. “We see the SME and mid-scale business that we wouldn’t have seen previously,” he said.
“The more mature insurance hubs only focus on the mega risks,” Alaoui added. “SME business simply does not come to London or Dubai.”
Casablanca has helped the Group gain greater access to northern, central, and western Africa from the CFC, but Alaoui said that while investment has been flowing into the continent in the last 10 to 20 years and local insurance markets have witnessed growth, many still remain relatively immature.
Across the continent, the trend is for risks to be placed with local insurers first, and only when all local options have been exhausted will international markets be considered, Alaoui said.
For that reason, Alaoui said it is imperative for a carrier to have a presence in the region they want to tap into. “You have to be there to have your share of the cake,” the executive said.
Alaoui said that this situation has also been reinforced by the increase in numbers of regional broking houses, who he said are also more likely to place business locally than take it to international (re)insurance markets.
And it’s not just a case of having boots on the ground.
Alaoui stressed the importance of understanding a new market and its culture before setting up shop. He explained that IGI underwrites specialty lines of business – including energy, construction, directors and officers, professional indemnity, financial institutions – out of the Casablanca office.
“We use local knowledge, we hire local underwriters who understand how business is done,” he said.
“Just speaking the language isn’t enough – relationships are key,” Alaoui added.
Alaoui said it was also imperative to adapt products to different regions in order to meet the varying demands of clients – for example, he noted a surge in demand for political violence cover.
Meanwhile, a mini technology and data ‘revolution’ across the continent is increasingly being used by the insurance industry to accelerate growth in insurance take-up – particularly on the back of exponential growth of mobile phones. In addition, many of the countries in the region have been revamping their insurance laws and requirements to boost the turnover of the local insurance market.
“It’s changing the insurance scene in Africa”, Alaoui concluded.