Low insurance penetration in Africa spells huge opportunities for SanlamAllianz, CEO says
Continent’s solid GDP projections, young population and rapid digitalisation make it very attractive, Heinie Werth says
Low insurance penetration in Africa offers SanlamAllianz a huge opportunity to grow its market share, according to Heinie Werth, the CEO of the newly formed joint venture.
“Africa has solid GDP projections, a young population and rapid digitalisation which makes the continent very attractive. On top of that, insurance penetration is very low,” Heinie Werth said at a capital markets day hosted by both companies.
“We understand that affordability is a big issue but it is about getting to people in way that makes our products affordable to them, because at the end of the day, everyone needs insurance,” the Sanlam veteran added.
“If you look at Africa, let’s say in 2021, there were €66bn (R1.32-trillion) in premiums written on the continent. Two-thirds of that is in SA and one third in the rest of the continent. I really believe that is where the opportunity is. If you add the GDP of the other African countries together, there is really no reason insurance in the rest of the continent should be so low relative to SA.”
The tie up between the Cape Town-based financial services group and Europe’s biggest insurer was completed last month and is led by executives from executives from companies. SanlamAllianz operates in 27 countries, excluding SA where Sanlam will continue as a stand-alone business.
The deal comes as the insurance industry scrambles to adapt to the disruption caused by the rapid advance of financial technology that has led to a flood of new entrants.
Sanlam has life and general insurance, as well as investment management operations in more than 30 countries, including Morocco, Ivory Coast, Nigeria and Botswana.
Germany-based Allianz’s insurance portfolio spans 11 countries, including operations in Egypt, Kenya, Cameroon and Uganda.
Delphine Traoré has been appointed as an executive responsible for general insurance at SanlamAllianz. She joined the management board of Allianz Africa as regional COO in February 2017 to develop Allianz’s business on the continent. Previously, she was CEO of Allianz Global Corporate & Specialty (AGCS) in SA.
Robert Dommisse will be responsible for the life insurance business. He was previously CEO of life insurance for Sanlam Pan Africa.
Sanlam group CEO Paul Hanratty said the tie-up of the two companies on the continent has many synergies.
“The two brands stand for trust and stability which is something this industry badly needs across the continent in order for the industry to fulfil its long-term potential,” he said.
“I just want to warn that this is the first look into the SanlamAllianz portfolio. We will build on the disclosures and insight into this exciting business as we progress,” Hanratty added.
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