Ayman Kandeel, CEO, AXA Egypt: Interview

Interview: Ayman Kandeel

How have the Covid-19 pandemic and the roll out of universal health coverage affected demand for insurance in the local market?

AYMAN KANDEEL: As is the case across the range of insurance lines, volatility or unexpected expenses raise awareness of risk and, with it, the benefits of insurance. The pandemic played an essential role in increasing awareness around the importance of having medical insurance – especially when unexpected health risks arise – and how insurance can help to ensure customers’ fiscal and physical security. Expanding health coverage remains a significant challenge, however, with the local market having a penetration rate of less than 1%.

The new universal health insurance (UHI) programme will be a key facilitator in conveying to the community the importance of insurance in all aspects of life. It will also help to normalise being insured in a way that is likely to contribute to sector growth over the longer term. The customer who is the primary stakeholder and beneficiary of the UHI plan will be the first to feel the full impact of the programme. At the same time, the UHI will encourage private insurers to innovate and create new insurance products and services that will complement the basic coverage offered by the government. Similarly to the system in place in France, each insurer will then have an opportunity to offer new services that address customers’ evolving needs.

In what ways will digitalisation and the adoption of new technologies shape the industry?

KANDEEL: Digitalisation is central to all sectors, and it has become essential in the maturation of the insurance sector. Understanding the customer is key to the development of products that best address their needs, as is understanding the risks associated with offering a particular kind of coverage. Technology enables better understanding through data collection and analysis, while also improving the efficiency of customer interactions. Expansion will be driven by improving the products and services on offer, as well as the customer experience.

What has been the impact of regulatory reforms on insurance penetration?

KANDEEL: Insurers are looking forward to new regulations that are anticipated to be a significant enablers for boosting insurance penetration. By introducing new forms of compulsory insurance for Egyptians, these changes will automatically increase the penetration rate. Subsequently, the regulations will introduce new customers, whether individuals or corporations, to products that could complement the basic coverage they are required to purchase. An example of this can be seen in the motor segment, where Egyptians are required to obtain compulsory insurance. The regulation created demand for a variety of supplemental coverage offerings, which benefitted customers and contributed to growth.

Which steps can the private sector take to increase penetration, and what role can insurers play in expanding insurance coverage?

KANDEEL: Egypt has one of the youngest populations in Africa, which has helped to create an economy with a large number of start-ups and small and medium-sized enterprises (SMEs). Such companies are looking for accessibility, efficiency and affordability when they consider insurance options. Especially in the case of SMEs, firms can offer insurance as part of benefit packages to their employees, which are their greatest asset. This fits into broader efforts to support and foster SME growth across all sectors, as business ownership is an empowering tool that can encourage younger generations to be creative and innovate to support the development of the Egyptian economy over the longer term.