A.M. BestTV: Insurers in Africa Face Reinsurance, Risk Management Challenges, Says A.M. Best Analyst

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FOR IMMEDIATE RELEASE

OLDWICK - JULY 19, 2018 07:36 AM (EDT)
In this ^A.M.BestTV episode, Rishwinder Grewal, financial analyst, A.M. Best, said some insurers operating in the sub-Saharan region of Africa are incorporating enterprise risk management (ERM) into their operations, but must expand beyond individual silos. Click on http://www.ambest.com/v.asp?v=africa718 to view the entire program.

“From A.M. Best’s perspective, a key tenet of the ERM assessment is that the risk profile of a company must be aligned with the capabilities of the insurance company,” said Grewal. “What we see in sub-Saharan Africa is that while companies might have a good risk management process, much of it is very much on a silo basis. Many companies do not look at their risks on an enterprise level. These companies must learn to effectively manage their risks at an enterprise level in order to face challenges that are ahead.”

A recent A.M. Best report states that rated sub-Saharan companies are well-capitalized.

“A key feature that we see in this market that brings the balance sheet strength assessment to a very strong level is the quality of the assets,” said Grewal. “However, there is a limitation as to the type of assets that companies can invest in, especially as most of these companies are chasing inflation-proofed returns. On the reinsurance side, there is an increased level of compulsory cessations within these markets.”

To access a copy of this special report, titled, “(Re)insurers in Sub-Saharan African Markets – Rating Review Highlights,” visit http://www3.ambest.com/bestweek/purchase.asp?record_code=273380 .

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^A.M.BestTV covers exclusive A.M. Best information and reports, targeted topics and key developments in the (re)insurance industry every Monday, Wednesday and Friday. Sign up for alerts of episodes at http://www.ambest.com/multimedia/ambtvsignup.html . View ^A.M.BestTV episodes at http://www.ambest.tv.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source.