DRC Insurance

According to Africa Re African Reinsurance Corporation, generally known as Africa Re, is a reinsurance company based in Lagos, Nigeria. Africa’s first continental reinsurer the latest figures (2016) show for DRC 

• Population 84m (2016) 
• GDP $49b (2016) 
• GDP/Capita $473 (2016) 
• Inflation rate 1.7% (2016) 
• Non life premiums US$66m 
• Life premium volume zero 
• Total premium volume US$66 
• Insurance penetration premiums in % of GDP 0.32% 
• Insurance density /capita USD 0.936 
• Local currency CDF 

In 2018 SONAS (the state monopoly insurance company founded in 1960s in the then Zaire)  had an insurance  market of just US$70m  “as a result of this situation, the insurance penetration rate in the DRC is one of the lowest in Africa. At 0.97% in 2018, it is far behind those recorded by its neighbors: 1.24% in Gabon and 2.4% in Kenya.6 Even Rwanda for instance has insurance penetration of 1.74% in 2017.   

DRC ought – given its size and weight as one of the “Big Three” African countries alongside Nigeria and S Africa, increase its share of the African market to roughly 20% at least equivalent to US$14b when actually it is less than 0.01% (US$70m approx. using the 2018 figures). Against this background  the US State Department notes the well known fact that  Democratic Republic of the Congo (DRC) is the second largest country in Africa and potentially one of the richest in the world in terms of natural resources. The US State Department says“With 80 million hectares (197 million acres) of arable land and 1,100 minerals and precious metals, the DRC has the resources to achieve prosperity for its people.”

The DRC could now forge a new domestic insurance market . However, for a variety of factors including the challenge that DC is francophone while the global growth opportunities in the international insurance market are centered around the anglophone market with a key centre in London, DRC is missing out. Currently the insurance penetration ratio in DRC is under 1% penetration. 7

It is against this background that there is a great opportunity to engage with the citizens of DRC drawing on new best practice from other parts of Africa and working with the world’s leading insurance centre – London. Forexample Lloyds recognises the opportunity that Africa represents for the future global insurance market.

The aim is to develop a DRC market both for citizens and for business. The plan is to focus on micro finance and other options that will provide DRC citizens with unique customer experience. PwC recent research in Africa confirms that “Appreciating customers and fulfilling their needs, together with their enhanced digital connectivity, is the first trend which is easily identifiable. This is arguably the number one megatrend impacting the global insurance industry today – that insurers recognise they can compete on the basis of a differentiated customer experience for the first time. The power is now in the hands of the customer, with insurers forced to respond with simple products and digital distribution channels. Today’s customers are open to a more interactive relationship with insurers. This is in contrast to the lowtouch industry we have traditionally seen, where customers just paid their premiums every month and contact was made with them when an insured event happened”