Wafa Assurance tested against Covid claims

Wafa Assurance today unveiled a technical result of 171 MDH for its Life branch, down -10.6%, following the increase in claims probably linked to the Coronavirus pandemic.

In the midst of a pandemic last year, Wafa Assurance demonstrated its strength to its peers by opting for the permanence of methods in the keeping of its accounts, leaving aside the derogations offered by ACAPS in this area. A year later, the number 1 insurer in Morocco has made a remarkable comeback, helped by the good performance of the financial markets and the recovery in activity. Profitability is indeed there, with a profitable half-year net result of 362 MDH, against -191 MDH in H1 2020, due to the improvement of technical indicators and the recovery of the financial markets. Equity is stable at 5.9 billion dirhams, and the solvency margin is 3.3 times the regulatory minimum.

Claims related to the pandemic
The insurer nevertheless posted a 10.6% drop in its Life technical result, which the Chairman and Chief Executive Officer, Ramsès Arroub, explains by the increase in the loss ratio for the “Death” activity: “We noted in 2021, for the first time in many years, a decline in the death loss/premium ratio. Obviously, this is not alarming…We compared this result with external sources, which confirm this increase in claims and the best explanation that we can give today, in a non-definitive way, to explain this increase in claims is the Covid ”. “The average mortality among insurers is in the order of a few hundred deaths per day and when we add the few dozen deaths linked to Covid-19, the impact is significant”, he explained. . “That said, when you relate this mortality to the portfolios of insurance companies, which are more urbanized and older, the gap is magnified.”
Remember that the pandemic also has an impact on the “illness” activity of companies. Wafa Assurance covers this pathology in its contracts and therefore covers the customers and employees of its business customers. As soon as there is a medical prescription, the patient is covered for his treatment, his care and his possible hospitalization within the ceilings which are defined in the insurance contract.

Ramp-up of subsidiaries
The cumulative turnover of the subsidiaries is 682 MDH, up 16% in the first half, contributing 11.5% of the group’s turnover. The objective is to achieve a contribution of 20% to 25% for the subsidiaries in Africa by 2024. This will require a doubling of the countries of presence that the group wishes to bring to 11 or 12 by this horizon.

Management confident in the outlook for the equity market
“We remain long on the outlook for the equity market and heavily invested in the interest rate part because a large part of our activity is capital or guaranteed rate. We therefore need security to maintain a good level of equity and deliver a certain return. We remain confident about the two compartments. Moreover, we have not significantly reduced the rates of return paid to customers in 2021 compared to 2020 (3.15% vs 3.25% in 2020). It is a signal of confidence in the portfolio invested and in the prospects,” said Arroub.

Read also: Wafa Assurance: Profit recovery in the first half

Adil Hlimi


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