Best's Commentary: (Re)Insurance Markets in West Africa Navigate Uncertainty Amid Political Shifts

3h ago | Source: AETOSWire

The withdrawal of Niger, Mali and Burkina Faso from the Economic Community of West African States (ECOWAS) is the latest sign of political turmoil in the region, but the direct impact on (re)insurance markets will be limited in the short term, according to a new commentary from AM Best.

In a new Best’s Commentary, “(Re)Insurance Markets in West Africa: Navigating Uncertainty Amid Political Shifts,” AM Best notes that while the insurance markets in Niger, Mali and Burkina Faso remain relatively small, large commercial risks require reinsurance, which is predominantly provided through mandated cessions to national and regional carriers (and retroceded to international markets) and traditional reinsurance buying. These are expected to continue to play a critical role in risk-sharing, despite the three countries’ exit from ECOWAS.

The commentary also points out that Niger, Mali and Burkina Faso remain members of the Conférence Interafricaine des Marchés d’Assurances (CIMA), which manages insurance regulations across member countries in the region. AM Best does not expect to see any departures from CIMA, but such a move could lead to some regulatory uncertainty for (re)insurers operating in these markets.

To access a complimentary copy of this commentary, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=351987.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.