Life and non-life insurance: the two insurance activities
The insurance industry is distinguished into two distinct activities, life and non-life insurance. Life insurance covers risks related to the health of individuals. There are three main types: death (the insured pays premiums regularly, and compensation will be paid to one or more beneficiaries of his choice upon his death); longevity (the insured pays premiums during his working life, and receives benefits upon retirement); disability (the insured pays a regular premium which guarantees the coverage of his disability if it occurs). One of the characteristics of life insurance is that it also serves as a savings product. Non-life insurance essentially protects property and business.
These two types of insurance are extremely different in how they work. Non-life insurance is divided into many areas of expertise (transport, agriculture, space, business interruption, nuclear, etc.) which are essentially technical, and therefore easily adaptable from one geographical area to another, from one market to another. An airplane remains an airplane. Nothing like that in life insurance. Of course, the actuarial techniques for calculating risk remain the same. But services and data are intimately linked to the local context. Genetic heritage, natural environment, sanitary and health practices, dietary and social habits, are all factors that influence the mortality and longevity of a population. To this is added the legal architecture of each country, which on the one hand governs the health and social protection systems, and on the other the use of personal data.
It can be seen from this brief description that Africa represents, or represented, a territory more favorable to the development of non-life insurance. Auto insurance is historically the fastest growing, as in many emerging countries. Automobile insurance contributions thus represent around a third of non-life insurance contributions in Africa (the lowest being Gabon with 29%; the highest being the Central African Republic with 46%, but in a very narrow market; for Côte d'Ivoire, the largest market in the area, the share of the automobile amounts to 32% - Fanaf, 2015). But if, in the construction of the insurance sectors, non-life insurance is the first to succeed in establishing itself, it is gradually life insurance which is gaining the upper hand. Thus, in 2014 worldwide, life insurance capitalized $ 2,654.5 billion, more than 20% more than non-life insurance (with $ 2,123.7 billion).
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