Africa News - Algeria: Falling dinar and car sales to hit insurance

Source: Middle East Insurance Review | Jan 2016

Mr Khelifati Hassen, CEO of Alliance Assurance

The depreciation of the Algerian dinar and a slump in new vehicle sales in the country have resulted in a significant impact on the insurance sector, said Mr Khelifati Hassen, CEO of Alliance Assurance.

He said that provisional figures for 2015 show that 150,000 to 200,000 fewer new vehicle registrations, which would mean a reduction of DZD6 billion (US$56 million) in premiums for the insurance sector, reported the Maghreb Emergent news website.

The current situation in the auto market has caused a “slowdown in revenue growth” of insurance companies, said Mr Hassen. The cost of motor claims management has also increased by 30-40% since last year, requiring a “significant financial investment”, he added.

In addition, the depreciation of the dinar against the euro and the US dollar has directly affected the prices of spare parts, with claims compensation becoming more expensive for insurers. The costs of spare parts account for up to 50% of insurance claims, he said.

Mr Hassen believes that the turnover of the insurance industry could stagnate in 2015 as a result.

DZD10 = US$0.09

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