Tunisia: Insurance sector aims to double GDP contribution in 5 years
Source: Middle East Insurance Review | Apr 2017
The Tunisian insurance sector aims to represent 4% of GDP within the next five years, doubling its present contribution, according to Mr Lassaad Zarrouk, President of the Tunisian Federation of Insurance Companies (FTUSA).
Currently, Tunisia has 22 insurers whose total premium volume in 2016 stood at TND1.8 billion (US$786 million), or 2% of GDP, reported Business News. Premium volume in 2015 was TND1.65 billion.
This proportion is very far from the international average of 7%, said Mr Zarrouk. “Although there has been some effort and a dynamic initiated by insurance companies, in recent years, it is still below the desired pace,” he said.
Mr Zarrouk pointed out that the sector can do better, provided it takes an overview of the development of the market. Motor insurance makes up a 60% lion’s share in the insurance sector, while life insurance only accounts for 18% of the market. The latter is because of banks that require individual borrowers to buy life insurance as a condition of granting them credit.
More generally, he believes that the major challenge is to change Tunisians’ perception of the sector rather than focus solely on the problems in motor insurance, let alone generalise them so that they are extended to other insurance products.
For motor insurance, he said: “There are improvements in terms of compensation timeframes in particular, but much remains to be done, notably in the introduction of new information systems.”
The industry also advocates the liberalisation of insurance pricing, along with the establishment of better governance.
TND1= US$0.43