A recent development in our Insurance Market Reports has been the creation of a common section for those francophone West African countries adhering to the regional insurance legislation known as the CIMA Code.

So far thirteen francophone African countries (Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Equatorial Guinea, Congo, Gabon, Ivory Coast, Mali, Niger, Senegal and Togo)   have signed and ratified the treaty setting up the Conference Interafricaine des Marches d’Assurances (CIMA), and have agreed to be bound by the insurance legislation (the CIMA Code) that forms an annex to the treaty.  The Federal Islamic Republic of Comoros has also signed the treaty, but has not yet ratified it. The code itself came into effect in February 1995 and consists of six “books”, covering life as well as non-life business. 

The treaty and the law grew out of a desire to rationalise and develop local insurance markets, as well as a wish to protect insurance policyholders and the victims of accidents.  The CIMA organisation, which replaced the Conference Internationale des Controles d’Assurances des Etats Africains (CICA), collaborates closely with the insurance authorities in individual member countries, notably with the local controller of insurance. It operates according to the following objectives:

• building up the insurance industry
• safeguarding the interests of policyholders
• protecting the technical reserves of insurers
• advising national governments on insurance matters
• supervision of insurance markets. 

The treaty created a supranational supervisory body, the Commission Regionale de Controle des Assurances (CRCA), which is widely credited with having brought a welcome discipline to the insurance markets that it supervises.

A proposal to implement “single approval” for the whole CIMA zone, effectively a freedom of services provision, was postponed on the advice of experts, to allow time for a closer examination of the consolidated accounts of insurers.  It was suggested unofficially that several national regulators feared that such a freedom of services provision would result in small national companies being overwhelmed by competition from the larger groups that are already growing up within the CIMA zone.   The logic of the supranational insurance legislation, and of other measures unifying commercial law across the region, suggests that a freedom of services provision will eventually come, although this may yet be in the distant future. 

The CIMA Legislation Report is now featured in the Supervision and Control section of our reports on the countries to which it applies.  For further information on this or any of the Insurance Market Reports, please contact us at axco@axcoinfo.com