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Ethiopia Insurance Q2 2018

BMI Industry View
SWOT
Industry Forecast
Life Premiums Forecast
Non-Life Premiums Forecast
Non-Life Sub-Sector Forecast
Industry Risk/Reward Index
Sub-Saharan Africa Insurance Risk/Reward Index
Market Overview
Life Market Overview
Non-Life Market Overview
Company Profile
Nib Insurance
Nyala Insurance Company
Methodology

Ethiopia Insurance Q2 2018

BMI View:

The Ethiopian insurance sector will see strong growth over the medium-term, albeit from a very low base with grosspremiums written representing a very low proportion of GDP at 0.3% even by sub-Saharan African standards. We forecast growth intotal gross premiums written of 14.8% annually on average over the next five years, reaching EBT10.6bn by 2022, but in USD termsgrowth will be lower at 6.6% reaching just over USD300mn. All but a small fraction will be in the non-life sector with property andautomotive insurance the biggest lines. Key drivers for higher growth would include rising household incomes and growth in vehicleownership and house purchases, as well as strong population growth. However, there are also downside risks, notably the country'spolitical instability and overwhelming reliance on trade in commodities, which can destabilise the market. Nevertheless, the lowabsolute value of insurance spending coupled with continued restrictions on foreign operators, will continue to temper the appetiteof foreign investors for local growth opportunities.


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