IVM Intersurer, which owns a significant stake in Hollard Insurance, has bought a majority share in a Ghanaian general insurer, as a first step in Hollard’s ambitions to grow in West Africa.
IVM Intersurer has taken a 51% share in The Metropolitan Insurance Company (Met Insurance), which has the fourth-largest market share in Ghana, for an undisclosed sum, said Hollard International MD Frans Prinsloo on Thursday. IVM Intersurer is the major shareholder in Hollard and the umbrella body for many of the insurer’s international businesses.
Hollard sees growth opportunities in West and East Africa. It would like to use the experience it gains in operating in Ghana to ultimately set up operations in Nigeria, Mr Prinsloo said.
The insurer is looking for opportunities in East Africa, where it does not yet have a presence.
A number of South African insurers want to expand into Ghana, where the short-term insurance industry has grown by over 25% in the past five years.
PwC’s Africa insurance trends report, released in October, found the top three target markets for South African insurers were Kenya, Nigeria and Ghana, due to their strong economic growth, low insurance penetration and anticipated growth in demand for insurance as the middle class grows.
PwC said: "Insurance penetration in Ghana, while low, is expected to rise with the growth in urbanisation and enabling support from the regulator, who has, for example, launched a new microinsurance framework."
Hollard would provide capital, skills, capacity and systems to Met Insurance, and help to introduce innovative products, Mr Prinsloo said. Met Insurance had about a 9% share of the general insurance market with a focus on the corporate and commercial market.
Hollard plans to grow the business through new corporate and commercial products, expanding into personal lines and bancassurance, as well as through opportunities in microinsurance and funeral cover.
The privately owned Hollard and Met Insurance have worked together over the past few years on a joint venture to develop and distribute bancassurance products through Barclays in Ghana.
The two major local shareholders will remain invested in the business, with Sir Sam Jonah’s private family trust having a 35% share.
The other major local shareholder, the state-owned reinsurer Ghana Re, will have a 10% stake in Met Insurance.
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