Natural catastrophe insurance premium rates have been revised in Algeria following the issuance of a new decree by the Ministry of Finance, that was published in the Official Gazette.
The text modifies the tariff schedule initially set in 2004 and revised in 2017. The new parameters take into account, in particular, the level of exposure to seismic risk by region, as well as the standard price per sq m of built-up area used to determine the insured value of real estate.
One of the main changes concerns the minimum amounts of insurance premiums. With the revision, the premium cannot be less than DZD2,500 ($18.75) for real estate and DZD3,500 for industrial or commercial facilities, compared to DZD1,500 and DZD2,500 respectively on the old tariff scale.
In Algeria, Nat CAT insurance has been mandatory since 2003 for owners of real estate as well as for natural or legal persons carrying out an industrial and/or commercial activity. The coverage specifically concerns direct damage caused by natural events of abnormal intensity, such as earthquakes, floods, storms and other natural disasters.
Natural disaster insurance is required, in particular, for the sale or rental of real estate before a notary, as well as for certain tax procedures. In the event of a disaster, uninsured property is not eligible for compensation, according to regulations.
Despite its mandatory nature, the Nat CAT insurance subscription level remains insufficient, particularly among property owners.