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Member, Beacon International Group, Ltd.
Insurers planning to expand global presence are now eyeing Africa as they believe that the continent presents good growth potential in the insurance sector.
In a new report on the region's "untapped demand," A.M. Best Co. said that Africa holds significant opportunity for insurers as the region's GDP is expected to experience good growth in the coming years.
Nigeria, which has seen substantial growth through its strong oil and gas sector, has the biggest insurance market in West Africa, Live Insurance News reported citing Best's report.
Meanwhile, the South African insurance sector boasts of a good economic base, prompting some local insurers to consider expanding outside of South Africa, into other countries across Africa and the world.
Carlos Wong-Fupuy, senior director for analytics at Best, said that African nations with stronger economies, largely boosted by the energy and mining industry, "have enjoyed greater demand for insurance." However, affordability continues to be a problem in poorer countries in the continent, Mr. Wong-Fupuy added.