Dutch risk managers recognise challenges of African markets

Members of Nederlandse Associatie van Risk en Insurance Managers (NARIM) were meeting to discuss the development of risk management more broadly, when Adri van der Waart, Insurance Manager, Arcadis, admitted that his firm had been operating in north Africa but was forced to pull out because of the political developments, and has no intention of returning. Jacqueline Plessius, Global Insurance Manager, of TNT, said they have no option but to follow their customers. “We go where they go,” she said. “But the risks of a transportation company cannot be compared to that of a chemical plant, building company etc. In Africa, our main risk is the safety and security of storage facilities. It is our customers’ goods at risk rather than ours, but it is a risk we need to—and indeed do—manage.” Peter den Dekker, Insurance and Risk Manager, VimpelCom, likened the situation to that of Russia and Ukraine, where political developments and sanctions have affected business immediately.“It is the same in Africa,” he said.hideHowever, he is optimistic about developments on the continent. His firm offers services to millions of customers across Africa but the operations are very localised. Most risks, he said, are managed in country and if a situation blows up, as in Ukraine, it has to be dealt with at that moment. Another financial risk identified by Ms Plessius is in relation to the local sub-contractors. “Sub-contractors will sign a contract confirming that they have adequate insurance cover. But to be in control you do need to actively evaluate if this is indeed the case. We do accept they cannot purchase the same cover, but a country- and risk-appropriate cover needs to be in place to limit the exposure of our own cover.” Mr den Dekker said the problem is not always limited to African countries. He also questioned the role of global programmes in some Africa countries. Too often, he claimed, risk managers were being told global programmes would help them out but when checking the detail it emerges that the programme will not be compliant in certain countries. That was a particular problem in Africa, he said, where the regulators all imposed different conditions on insurance. “It is where the role of insurance risk manager becomes crucial in getting added value,” he said. Mr den Dekker said people in Africa are eager to learn and gain experience; they often just need support but they can struggle to get their expertise recognised. He believed that there is a real and growing interest from international insurance markets to have a presence in Africa and to understand the local markets. However, he warned that international markets are not necessarily challenging local insurers enough and not encouraging local risk management development as a result. Ronald de Vos, Insurance Manager and Legal Counsel, Nutreco, agreed that Africa poses challenges for insurance markets. His firm has had Africa on the radar for a couple of years and is looking for acquisition opportunities. It has been selling products for more than a decade on the continent and last year acquired 100% ownership of a production facility in Egypt. It is also close to buying a similar facility in Nigeria. Like Ms Plessius, he said: “We need to go where our customers and markets are.”

Dutch risk managers recognise challenges of African markets

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