NOSSA Seguros Angolan Insurance Company 2017, March 28th
Agenda 1. NOSSA Seguros Corporate Overview 2. Angolan Financial System Overview 3. Angolan Insurance Market 4. NOSSA Seguros Review 5. Insurance Sector Challenges
NOSSA S EGUROS C ORPORATE O VERVIEW
Shareholding Structure Highlights 3,5% In 2012 BAI assumed control of NOSSA Seguros with the purchase of Real MRN Seguros ’ shares. BAI shareholdings reached 72% of NOSSA’s share capital. NOSSA Seguros - Nova Sociedade de Seguros de Angola, S.A. was founded in 6 5% MATEBA October 2004, resulting of a partnership between the Insurance company Real Seguros, Banco Angolano de Investimentos, International Finance Corporation 72,2% and a group of Angolan small investors. NOSSA Seguros, part of the BAI Group, is one of the pioneering companies to start business in the insurance sector in B ANCO A NGOLANO DE I NVESTIMENTOS Angola. Officially, NOSSA Seguros started its activity in November 2005 and, closely 19,3% S MALL attuned to the multiple needs of the Angolan market, operates in Life and Non-Life S HAREHOLDERS insurance, in the corporate and private segments.
Mission and Values Our mission is to contribute to the development of the Angolan insurance market by promoting inclusion, innovation and quality of services, meeting the needs of customers, employees, partners and shareholders. It is our main purpose and where we For the people and for the commitments we CUSTOMER RESPECT FOR focus our attention. We work to meet make with them, either being employees, ORIENTED OTHERS your expectations and needs customers, partners or shareholders Our employees are our most We are guided by clear principles, in all VALUING precious resource. Through PROFESSIONAL HUMAN our relations, based on integrity, ETHICS their effort, we build and CAPITAL transparency, accuracy and truth consolidate our brand We strive to develop a more We support sustainable conditions SOCIAL CORPORATE fair, cooperative and more for the planet, for people and for our RESPONSIBILITY SUSTAINABILITY socially aware society business
Governing Bodies In 2016 ended the mandate of the current administration and NOSSA Seguros in an ordinary General Shareholding Meeting proceeded to the appointment of new governing bodies for the period 2016-2020. G ENERAL B OARD OF S UPERVISORY R EMUNERATION S HAREHOLDERS B OARD D IRECTORS C OMMITTEE M EETING S HAREHOLDERS Chairman Chairman Chairman Chairman E XTERNAL A UDITORS Secretary 2 Members 2 Members Chief Executive 2 Substitute Officer Members 2 Executive Directors Non Executive Director
A NGOLAN F INANCIAL S YSTEM O VERVIEW
Financial System in Angola B ANKING C APITAL M ARKETS I NSURANCE R EGULATORS 24 insurance companies (3 with Pension Funds N UMBER OF under management) 27 Banks 45 registered entities P LAYERS 51 brokers 399 agents 6 pension funds managers 26 Pension Funds
Financial sector development strategy (1/2) S TRATEGIC P ILLAR II S TRATEGIC P ILLAR III S TRATEGIC P ILLAR IV S TRATEGIC P ILLAR I I NSURANCE & P ENSION F INANCIAL STABILITY F INANCIAL INCLUSION C APITAL MARKETS FUNDS • Strengthening of the legal • Shore up collaterals, • To promote the • To diversify the insurance framework and supervision strengthen payments development of capital products offering and effectiveness to oversee systems and promote retail markets with an initial focus spread the insurance and rule the financial payments, savings on sovereign debt, coverage. sector, banks resolution, campaigns, ensure subsequently expanding to • To develop the pension crises management, financing to SMEs, corporate debt and funds industry alongside contingency plans, anti consumer protection and ultimately the equity strong regulation and money laundering (AML), financial education market. sound governance. countering financing of initiatives. terrorism (CFT), financial services networks (FSN) and financial services relevant IT systems. I MPLEMENTATION STRATEGY
Financial sector development strategy (2/2) I NSURANCE : S TRATEGIC P ILLAR IV a) Improve the regulations and supervision of the insurance industry: I NSURANCE & P ENSION New insurance regulation consistent with the international standards issued by the International FUNDS Association of Insurance Supervisors (IAIS). • To diversify the insurance b) Strengthen of the supervision over the insurance industry: products offering and spread the insurance Effective prudential and market supervision ensuring compliance with the regulation, based on a well coverage. trained and resourceful supervisor. • To develop the pension c) Spread the access to insurance products funds industry alongside d) Set up ARSEG’s Insurance and Pension Funds Academy strong regulation and sound governance. e) Reinforce “Motor insurance” and introduce mandatory “Personal indemnity insurance” f) Develop “Agriculture insurance” P ENSION FUNDS : a) Review and update the legal and regulatory framework for insurance b) The taxation around insurance needs to be reviewed c) Increase awareness of the industry through the establishment of an association
A NGOLAN I NSURANCE M ARKET
Context N ON - LIFE INSURANCE PENETRATION (GWP IN % OF GDP) AND GDP PER A FRICA CAPITA (USD) IN 2014 (I N A FRICA ) 69% 68% 68% 68% 32% 32% 31% 32% 2015 2012 2013 2014 A DVANCED MARKETS 58% 56% 57% 56% 44% 43% 44% 42% 2012 2013 2014 2015 Life Non-Life Source: Swiss Re, sigma explorer (non-life insurance penetration) and IMF, World Economic Outlook April 2016 (GDP per capita)
ASAN – Association of Angolan Insurance Companies N UMBER OF COMPANIES ASAN IN A NGOLA 24 17 9 4 2005 2010 2015 2016 A UTO T ECHNICAL C OMMISSION F INANCIAL AND F ISCAL A FFAIRS W ORKMEN ’ S C OMPENSATION H EALTH T ECHNICAL T ECHNICAL C OMMISSION T ECHNICAL C OMMISSION C OMMISSION • • New minimum capitals Investment rules; • From a self-regulatory • Consultation with public • and new TPL rate; Solvency requirements; perspective, all the entities to improve the • • National registration file; New Chart of Accounts; associates subscription efficiency of healthcare • • Auto claims and fraud Pension Funds fiscal and claims management provision; file . framework; procedures are being • Creation of networks of • Savings Insurance reviewed; preferred providers. Incentives. • FUNDAP Creation. W ORKING G ROUP ON L EGISLATION R EVIEW T RAINING W ORKING G ROUP M ARKETING W ORKING G ROUP
NOSSA S EGUROS R EVIEW
NOSSA Seguros operational review NOSSA Seguros operates Life and Non-Life insurance and manages open and closed Pension Funds. With a wide structure, expanding throughout the Angolan territory, it has 26 agencies installed in 15 provinces. A UTO L IFE ( RISK ) A CCIDENTS , H EALTH AND T RAVEL P ENSIONS F UND T RANSPORT , P ROPERTY It also relies on the support of AND O THERS the Bank BAI agencies’ network, under the channel Bancassurance.
NOSSA Seguros financial review 2016 Highlights • Reinforcement of solvency from 166% in 2015 to 195% in 2016; • Growth in 143% of net income; • Increased coverage of technical provisions from 150% in 2015 to 186% in 2016; • ROE of 31%; • Reduction of the Loss Rate; • Maintenance of the Expense Ratio.
NOSSA Seguros financial review
I NSURANCE SECTOR CHALLENGES
Is there a need to increase the number of mandatory insurance? e.g. Freight transport insurance, multi peril insurance, personal indemnity insurance, etc
Reinsurance in Angola… When? A NGOLA ’ S CURRENT LEVELS OF RISKS TAKEN MEANS • 1st African Reinsurer: THAT THERE IS A NEED FOR RISK TRANSFER , RESULTING IN HIGH CEDED RATIOS TO REINSURERS . Egypt Re (1957) A S SUCH , INSURERS ’ PROFITABILITY IS VULNERABLE TO • 1st Privately owned Reinsurer: SHARP INCREASES IN REINSURANCE RATES . Best Re (1985) in Tunisia • 1st Continental Reinsurer: Estimated non-life reinsurance market size Africa Re (1976) • Today : 36 Reinsurers based in Africa − 15 privately owned − 4 regional / sub-regional − 5 South African based (Swiss Re Life & Health, Munich Re, Hannover Re, Scor Re and Gen Re). − 10 State owned & 2 Private/State owned Where AngoRe should be Sources: Africa Reinsurance Pulse 2016
Do we need AngoRe? R EINSURANCE BUSINESS RETENTION IN • Currently the insurance sector in Angola only A NGOLA (%) 0,57 retains half of the GWP, being the other half 0,56 ceded to international reinsurers; 0,55 0,54 0,53 • By increasing the retention of risk: 0,52 0,51 • Local wealth increases; 0,5 0,49 • The FX pressure easies. 0,48 0,47 2011 2012 2013 Source: ARSEG/PWC 2014
Could the whole players in the industry apply for Oil & Gas co- insurance? • Unrated insurance companies? • Lack of internal controls? • True & fair audited financials? • More stringent solvency requirements to operate the oil & gas insurance business? • Lack of underwriting expertise ? • Lack of actuaries to fairly price the oil & gas insurance risk?
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