By Favour Nnabugwu
Africa Specialty Risks (ASR) has launched a new reinsurer in Mauritius, from which it committed to establish business development hubs in Nigeria, and five other countries.
The other five countries comprise Morocco, Kenya, South Africa, Cote d’Ivoire and Egypt.
Reinsurer has been fully capitalised, though the amount has not been revealed, and secured an Insurance Manager licence from the Financial Services Commission in Mauritius.
The founders say the launch will look to fix the issue of a shortage of insurance capacity across Africa – a situation that has been made worse by the COVID-19 pandemic. Mauritius has ambitions of becoming the re/insurance hub for the African continent.
Mikir Shah, CEO of Africa Specialty Risks, said: “We have chosen to set up Africa Speciality Risks Reinsurer in Mauritius as we see it as a central hub for Africa. Mauritius has a naturally bilingual population, allowing us to operate effectively across the vast majority of African countries.
It has an educated population, making it an ideal reinsurance hub because there is an abundance of potential skills that can be developed further with training. It already has an established insurer presence expanding into the continent, and we believe that Mauritius has the capability to become the reinsurance hub for Africa.
“Mauritius will be one of our major operations and we are pleased to count on the support of the Mauritian Government and the FSC.
We are delighted to have both our Reinsurer and Insurance Manager licences in place as we prepare to establish our business on the ground. We will have underwriting, claims management, office support, compliance, accounting and business development functions in Mauritius. We will shortly be making further announcements regarding our plans for recruitment on the island.”
Souleymane Ba, a Partner at Helios Investment Partners, said: “We have identified a sustained lack of adequate insurance capacity across Africa, which has been exacerbated further by COVID-19 as global reinsurance providers focus on their home markets.
ASR has been established to address this gap by providing specialist risk mitigation products which companies and capital providers operating in Africa have found difficult to access to date. We are pleased that the Reinsurer is to be based in Mauritius, as a well-established hub for financial services and investments in Africa.”
The Minister of Financial Services and Good Governance, the Hon. Mahen Kumar Seeruttun, said: “Mauritius has all the right ingredients to become a reinsurance hub for Africa. Mauritius is a safe, sound and trusted jurisdiction, with a robust legal framework and a well-developed ecosystem for financial services, including insurance. Our jurisdiction is well recognised by investors and international bodies for its ease of doing business.
“Mauritius is also very well connected internationally and is part of the African Continental Free Trade Area (AfCFTA), which entered its implementation phase this year, and which is expected to boost intra-Africa trade and investment.
It is therefore very timely that Africa Specialty Risks has chosen to domicile its Reinsurer in Mauritius to provide additional choice and capacity to support the growing reinsurance needs of the African continent. I welcome this initiative as a key step forward in reinforcing the position of Mauritius as a reinsurance hub for Africa.
“As the pandemic spreads, the emerging risk of multiple lines of insurance exposed to COVID-19 also grows, leaving insurers, reinsurers, regulators and rating agencies with the daunting task of quantifying that exposure and estimating how it will be allocated between the primary insurance and reinsurance markets.
On the other hand, COVID-19 also represents an opportunity for established reinsurers and new entrants. It also signifies an opportunity to reaffirm the purpose of insurance: protecting people, communities and businesses from unexpected risk, while embracing rising societal concerns around sustainability and fairness.”