by Michael Zielenziger
With the U.S. Fed raising interest rates, there’s ample concern about how developing economies will fare in the New Year. A rising dollar can hurt commodity exporters, and there’s fear that slumping prices for oil and other commodities will also affect growth in emerging markets.
Yet across sub-Saharan Africa, significant population increases, rapidly rising incomes and new technologies offer real opportunities for insurance firms to generate significant growth in both life and non-life products, especially in countries that haven’t been deeply served by the insurance industry in the past. From Ghana and Nigeria to Uganda, rising incomes and growing affluence put insurance purchases squarely on the agenda, as consumers move to buy cars, smart phones and even health care.
The mobile phone is also revolutionizing insurance consumption across Africa – not only because in some markets the mobile phone becomes the main means to transfer funds in a country where the vast majority lack bank accounts. In other markets, as in Ghana, insurance has become a “marketing tool” for SIM card providers eager to grow their business, and these provider see insurance products as an important market differentiator.
Oxford Economics, working in collaboration with EY, has developed a new report that analyzes growth opportunities and risks across seven key markets in Anglophone Africa. It concluded that markets in Zambia, Ghana and Kenya will offer the most attractive mix of rewards and opportunities over the next three years, based on an analysis of key metrics, including demographic change, market size and macro-economic and political risk
To learn more about Growth, Opportunities and Risks in Africa, check out EY’s new report: Waves of Change Revisited: Insurance Opportunities in Sub-Saharan