Insurance in Algeria is far from inclusive, particularly against climatic risks, natural disasters and other agricultural calamities, in the view of Mr Mokhtar Naouri, former CEO of Cash Assurances.
Speaking to Algeria Eco, he said that the situation can be explained by at least four factors:
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The social policy of the State creates alternatives to insurance and, therefore, does not encourage the take-up of insurance. “Even compulsory insurance is not subscribed to, outside of motor insurance,” Mr Naouri said.
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Insurance premiums are very low, either because of strong competition in a market that is struggling to attract new customers or because of the existence of mandatory tariffs which are well below the economics, as is the case with motor vehicle third-party liability insurance.
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The Algerian economy has for several years been marked by low private industrial investment, management problems in insurable public companies, reduced imports, high inflation, and a fall in purchasing power.
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Insurers are weak in marketing and product innovation.
He said that the new insurance law, currently being reviewed, must establish the conditions for an improvement in the insurance environment and the governance and management of insurance companies.