Resilient insurance in the face of Covid

With a penetration rate of 4.1% in 2020

The insurance and reinsurance sector has shown its solidity and resilience in the face of the crisis. This is confirmed by the Insurance and Social Welfare Supervisory Authority (ACAPS) in its activity report for the year 2020 presented on Wednesday January 12 to the head of government Aziz Akhannouch, during a working session. held by videoconference. This meeting was an opportunity to review the situation of the insurance and social welfare sectors for the year 2020, as well as the results of the Authority’s control activities. With regard to the insurance sector, Acaps indicates that activity rose slightly in 2020 (+1%). Back to the main indicators for the 2020 financial year.

MAD 45.1 billion in premiums issued

The volume of premiums issued in direct business reached 45.1 billion dirhams for the same year, down from the growth recorded in 2019 (+8.6%). “The revenue structure remains dominated by the ‘life and capitalization’ and ‘land motor vehicles’ categories, which drained 71.7% of emissions. Including bodily injury and accidents at work, this rate stands at 86.4%”, underlines the Acaps in its activity report. And to specify that “in terms of positioning, Morocco now occupies the 49th rank on a world scale, thus gaining a place compared to the year 2019. It has retained the 2nd place in Africa behind South Africa and the 3rd in the Arab world after the United Arab Emirates and Saudi Arabia”. Note that the Moroccan insurance market posted a penetration rate of 4.1% in 2020, allowing it to rank first in the Arab world and second position in Africa after Africa. from South.

A net result of 3.2 billion dirhams

In terms of profitability, the insurance sector achieved a net result of 3.2 billion dirhams in 2020, down 18.7% compared to 2019. “At the origin of this decline, the direct insurers who recorded a net result of 2.9 billion dirhams, down 21%, while the net result of exclusive reinsurers improved by 11.7%, to 318 million dirhams”, explains Acaps in this regard. As for the decline in the net result of direct insurers, according to the Authority, it affected both the technical result (-12.6%) and the non-technical result (-424.5%).

ACAPS also points out that the fall in the technical result concerned life insurance (-22.7%) and non-life insurance (-10.1%). It results from the combined effect of the 33% fall in the financial balance (-1.8 billion dirhams) following the contraction of the stock market as well as the 208.6% improvement in the operating margin (1 .9 billion dirhams). “This improvement benefited on the one hand from the drop in non-life benefits expenses (-3.9%) and on the other hand from the growth in non-life earned premiums (+3.1%), boosted by the new guarantee against the consequences of catastrophic events”, can be noted from the Authority. Another factor cited is the 10.1% appreciation of the reinsurance balance (1.2 billion dirhams) in favor of reinsurers, following the decline in claims. The fall in net income led to a contraction in the sector’s rate of return on equity, placing it at the end of 2020 at around 7.5% against 9.6% a year earlier. It should be noted that the equity of insurance and reinsurance companies amounted to 43.3 billion dirhams at the end of 2020, a consolidation of 2 billion dirhams compared to 2019.

Financial investments up 5.6%

As for the financial investments of insurance and reinsurance companies, they increased by 5.6% in 2020, thus amounting to 205.9 billion dirhams at the end of 2020 (inventory value) against 195 .1 billion a year earlier. Fixed income assets are the leading investment instrument, capturing 48.9% of the shares against 44.4% for equities. Real estate investments represent only 3.7% of all investments. The amount of investments in market value reached 233 billion DH, a slight appreciation of 0.7%. On the other hand, unrealized capital gains fell by 25.3% to stand at 27.1 billion DH under the effect of the drop in the stock market.

Bancassurance: 29.4% of turnover generated by bank branches

Led by 11 banks and 3 financing companies and a microcredit association, bancassurance attracted nearly 30% of the sector’s turnover in 2020, dominated up to 95.3% by life insurance. Referring to Acaps, the bancassurance activity focuses on personal insurance, assistance and credit insurance. The banking network authorized to present the 13.1% insurance operations consists of 6,021 branches. Territorially, the region of Casablanca-Settat concentrates 29.4% of bank branches, it is followed by the region of Rabat-Salé-Kenitra (15.4%) and the region of Fez-Meknes (13.1%). ).

Distribution network: 3 regions of Morocco capture more than half of the points of sale

The distribution network had, at the end of 2020, 2,114 insurance intermediaries, including 1,655 agents and 459 brokers. In addition to intermediaries, there are 650 direct management offices. The geographical distribution shows a strong presence of intermediaries and direct management offices in the regions of Casablanca-Settat (31.1%), Rabat-Salé-Kenitra (15.3%) and Fez-Meknes (11.3%). These three regions alone account for 57.7% of points of sale. It should be noted that this distribution channel generated 70.1% of the sector’s turnover, including 33.0% by insurance brokers and 23.6% by insurance agents.

Financial intelligence: FSNA report presented to the head of government

Along with the presentation of the Acaps activity report to the head of government, Aziz Akhannouch held a remote working session with Jawhar N’fissi, president of the National Financial Intelligence Authority (ANRF). The session was dedicated to the presentation of the ANRF’s annual report for the year 2020. The report drawn up in this regard highlights an increase in the indicators of the activity of the ANRF in 2020 on the register of suspicious transaction reports. up 23% compared to 2019. On the other hand, the report shows consistency in 2020 in terms of the exchange of information between the FSNA and its foreign counterparts active in the fight against money laundering and the financing of terrorism.

“Despite the constraints posed by the Covid-19 epidemic, the ANRF has continued, in coordination with the authorities concerned, its action in favor of strengthening technical compliance with the national system for combating money laundering and the financing of terrorism and its efficiency with a view to completing the enhanced follow-up process of the Middle East and North Africa Financial Action Task Force (MENAFATF) and the Financial Action Task Force (FATF) on schedule”, says a statement from the head of government’s department. Similarly, 2020 was marked by the drafting of the legislative amendment relating to Law 12-18 which amends and supplements the Criminal Code and Law 43-05 relating to the fight against money laundering which reinforced preventive and repressive measures, in addition to the revision of the ANRF’s legal and institutional framework, the strengthening of the framework for the supervision of non-financial businesses and professions, the institutionalization of the public register of beneficial owners among legal persons and the Adoption of a legal and institutional framework for the application of targeted financial sanctions issued by the United Nations Security Council.

It should be noted that the head of government and the president of the ANRF reviewed the means favoring the improvement of the action and the development of the activities of the said authority. A meeting with the heads of the relevant government departments is therefore scheduled for February to examine the data relating to this question.

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