Africa Specialty Risks, a reinsurance business focused on providing risk mitigating insurance solutions to the African Corporate and Specialty market, announced that it had launched a fully capitalised and licenced reinsurer based in Mauritius to meet the needs of the African continent.
ASR is focused on becoming the partner of choice to corporations through the provision of comprehensive and bespoke risk mitigating insurance solutions, and offers capacity across Property, Construction, Political Risk, Trade Credit, Energy, Liability and PVT (War, Political Violence and Terrorism), with further lines of business being developed.
The reinsurance company in Mauritius will provide additional African domiciled capacity to the ASR’s current MGA capacity offering.
ASR is led by Mikir Shah, former CEO of AXA Africa Specialty Risks, and Bryan Howett, former CEO of Old Mutual’s pan-African reinsurance operations.
ASR is seeking to create a scalable African reinsurer which will be of real benefit to the African continent. In addition to the local reinsurance capacity, the business has secured a multi-year binder capacity of up to $25 million per risk through a partnership with India's GIC Re and annual capacity from Hong Kong based Peak Re. This has been supported and completed with the help of Aon.
Alongside the Reinsurer licence, ASR has also been granted an Insurance Manager licence from the Financial Services Commission in Mauritius, which will act as a Managing General Agent (MGA).
ASR is backed by Helios Investment Partners, the largest Africa-focused private investment firm, through its latest private equity fund Helios Investors IV, L.P. whose investors include CDC Group (the UK’s development finance institution) and the International Finance Corporation (a member of the World Bank Group), as well as institutional investors.
The fund was launched in June 2019, with the ambition to support initiatives targeting Africa. ASR marks the fund’s second investment this year, and capital has been committed to fund ASR’s growth and expansion plans.
Souleymane Ba, a Partner at Helios Investment Partners, said: “We have identified a sustained lack of adequate insurance capacity across Africa, which has been exacerbated further by COVID-19 as global reinsurance providers focus on their home markets. ASR has been established to address this gap by providing specialist risk mitigation products which companies and capital providers operating in Africa have found difficult to access to date. We are pleased that the Reinsurer is to be based in Mauritius, as a well-established hub for financial services and investments in Africa.”
Mikir Shah, CEO of Africa Specialty Risks, commented: “We have chosen to set up Africa Speciality Risks Reinsurer in Mauritius as we see it as a central hub for Africa. Mauritius has a naturally bilingual population, allowing us to operate effectively across the vast majority of African countries. It has an educated population, making it an ideal reinsurance hub because there is an abundance of potential skills that can be developed further with training. It already has an established insurer presence expanding into the continent, and we believe that Mauritius has the capability to become the reinsurance hub for Africa.”
“Mauritius will be one of our major operations and we are pleased to count on the support of the Mauritian Government and the FSC. We are delighted to have both our Reinsurer and Insurance Manager licences in place as we prepare to establish our business on the ground. We will have underwriting, claims management, office support, compliance, accounting and business development functions in Mauritius. We will shortly be making further announcements regarding our plans for recruitment on the island,” he added.
Mahen Kumar Seeruttun,minister of Financial Services and Good Governance,Mauritius said: “Mauritius has all the right ingredients to become a reinsurance hub for Africa. Mauritius is a safe, sound and trusted jurisdiction, with a robust legal framework and a well-developed ecosystem for financial services, including insurance. Our jurisdiction is well recognised by investors and international bodies for its ease of doing business.”
“Mauritius is also very well connected internationally and is part of the African Continental Free Trade Area (AfCFTA), which entered its implementation phase this year, and which is expected to boost intra-Africa trade and investment. It is therefore very timely that Africa Specialty Risks has chosen to domicile its Reinsurer in Mauritius to provide additional choice and capacity to support the growing reinsurance needs of the African continent. I welcome this initiative as a key step forward in reinforcing the position of Mauritius as a reinsurance hub for Africa.”
“As the pandemic spreads, the emerging risk of multiple lines of insurance exposed to COVID-19 also grows, leaving insurers, reinsurers, regulators and rating agencies with the daunting task of quantifying that exposure and estimating how it will be allocated between the primary insurance and reinsurance markets. On the other hand, COVID-19 also represents an opportunity for established reinsurers and new entrants. It also signifies an opportunity to reaffirm the purpose of insurance: protecting people, communities and businesses from unexpected risk, while embracing rising societal concerns around sustainability and fairness,” he said.
ASR intends to work proactively with local regulators and clients to develop skills and provide training to local underwriters. Environmental, social and governance (ESG) considerations are central to ASR’s values, particularly in relation to local capacity building.
The provision of comprehensive, reinsurance solutions by ASR to local and global customers gives corporates and investors the confidence to grow their businesses, thereby increasing business activity, and the associated developmental flow-through benefits.
In addition to the operation in Mauritius, ASR plans to establish business development hubs in six other African countries, namely Morocco, Kenya, South Africa, Cote d’Ivoire, Egypt and Nigeria. ASR will be investing in local training of the market in specialty insurance lines, where appropriate, as well as recruitment and infrastructure surrounding the hubs.