Direct insurers in Morocco have generated a combined net profit of MAD4.4bn ($485.1m) in 2024, 2.9% higher compared to 2023's MAD4.2bn, according to the latest annual financial stability report released by the kingdom's financial authorities.
The 12th Annual Financial Stability Report was released earlier this week by the Insurance and Social Welfare Supervisory Authority (ACAPS); the central bank, Bank Al-Maghrib, and the Moroccan Capital Market Authority (AMMC). The report provides a cross-sectional view of the state of the Moroccan financial system, including the insurance sector.
The rise in net profits is explained by the combined effect of several mixed factors, says the report. Overall, the positive trend in the insurance sector's income was mainly driven by the performance of non-technical and investment activities, which benefited from the strong performance of the financial market.
Non-technical income, although representing only 8.3% of net income, increased significantly by MAD392m.
The life technical income net of reinsurance decreased by 6.3% in 2024 despite its investment performance. For its part, non-life technical income net of reinsurance declined by 2.3%, due to a contraction in the net reinsurance operating margin, explained by a reinsurance balance unfavorable to ceding companies.
The moderate claims experience observed in categories with high exposure to peak risks benefited reinsurers, thus contributing to the reduction in direct insurers' net operating margin.
Shareholders' equity in the insurance industry increased by 3% as of 31 December 2024, a level close to that of net income (+2.9%), which allowed the insurance sector's return on equity (ROE) to remain virtually unchanged from the previous year (9.6%).