Afro-Asian sets up shop in Botswana
Katlego Isaacs | Tuesday March 1, 2022 06:00
Launched officially on Wednesday, Afro-Asian announced the establishment of its new Gaborone-based office that specialises in life and health reinsurance broker services to expand the penetration of related insurance policies in Botswana.
Founded 33 years ago in London, the company has made a unique name for itself being the only UK-based company that primarily focuses on providing reinsurance services almost exclusively to the African market.
The company has generally sought to be an early stakeholder in the rapidly developing insurance sector of African countries with brokerage offices in Kenya, Zimbabwe, Ghana and Tanzania.
For their fifth office on the continent, Botswana was identified as a perfect low-risk market with a strong potential for exponential growth in the insurance sector, especially given the politically and financially stable environment of the country.
Afro-Asian managing director, Ryan Phillips expressed his delight towards the professionalism of people in Botswana and the business-friendly environment of the country stating, “One of the reasons we chose Botswana is because it’s very easy to transact business here and we feel our proposition will be valued here“.
Phillips added: “This is a stable country, the markets are very well regulated. We’re not only confident in entering this market but we’re also generally just happy to be here'.
Botswana’s insurance market is currently relatively small with only 23 insurance companies striking a 2.8 percent national insurance penetration rate, significantly lower than the global average 7.2 percent rate.
However, according to Udai Patel, the company’s executive chairperson, the experiences and skills Afro-Asian has developed across Africa will be more than sufficient to spearhead increased insurance penetration in Botswana.
“As a member of Lloyd's of London, the centre of global insurance, we have access to very strong reinsurers with very strong balance sheets and a good security rating,” Patel noted.
He added: “We’re also bringing in our specialist product knowledge built over 33 years, which we believe is suitable for the African markets. Our UK-based company has seen gross revenue grow, on average, by 15% year on year. During the height of the pandemic, our gross profits had grown by as much as 63%, and we’re bringing those skills into the Botswana market”.
In regards to bringing skills to Botswana, Afro-Asian also owns the London School of Insurance and has held multiple training seminars for the local market. Patel noted that the school has shifted to providing comprehensive and affordable online classes to accelerate the accessibility of financial literacy globally.
Patel stated, “There’s a very intelligent talent pool in Botswana and it’s hungry for the knowledge that we can provide”.
Phillips stated that certain employees at Afro-Asian will have the chance to be internationally transferred across Africa to both impart their knowledge and receive a critical understanding of the nature of the international insurance market.
Beyond bringing skills and knowledge to Botswana, Patel explained that Afro-Asian will not be a stereotypical multinational reinsurance broker that sends revenues back to its home country; rather the income generated in Botswana will be reinvested into Botswana. “By being established locally in Botswana, we’re not one of these brokers that are going to be taking everything out. Whatever is earned here will be reinvested here, right back into the local economy.”
Afro-Asian already has multiple promising partnerships with companies in Botswana including being the retrocession broker to FMRE Botswana, which just last week announced a merger with Aleyo Capital and had consistent year on year revenue growth of which institutions such as Botswana Public Officers Pensions Fund are privy to the dividends.
This growth is attributed in part to the risk alleviation offered by Afro-Asian indicates positive projections for the insurance sector of Botswana and the growth of the local economy.