Tunisia: Authorities to broaden insurance distribution channels
Source: Middle East Insurance Review | Dec 2018
The Tunisian authorities plan to broaden distribution channels with new operators, with relevant provisions to be made to the insurance law currently under review. The objective is to leverage various channels, in addition to banks, to mobilise long-term savings which are necessary to financing economic development.
Ms Jouda Khemiri, director of the General Committee of Insurance (CGA) at the Ministry of Finance, said it is a matter of introducing other entities like telephone operators, securities firms, leasing and factoring companies. She was speaking at a seminar in Tunis recently on ‘Bancassurance in Tunisia: opportunities and challenges’.
Business from bancassurance, which was started in Tunisia in 2002, is stalling. Thus, insurers and banks are looking for new products that can breathe new life into bancassurance. The classes of insurance authorised by the 2002 law that can be sold through banks include: agricultural, loans and bonds, assistance and life.
Bancassurance generated premiums of TND445m ($153.5m) in 2017, of which 95% was from life insurance. Bancassurance’s market share in life insurance increased from 29.7% in 2010 to 51% in 2017. The total bancassurance premiums represent only 11% of overall market share.
Experts said the situation is explained by the fact that the market is captive and not competitive. People take up insurance because they are forced to do so and because insurance bought through banks is largely to cover bank loans. The need is to promote insurance so that more people will buy it voluntarily. M
TND1 = 0.34