Mozambican insurance firms want a piece of the insurance pie from the large-scale capital projects in the oil and gas sector.
Oil giant companies prospecting and developing oil and gas projects in the resource-rich Cabo Delgado province in northern Mozambique have purchased their insurance policies abroad, which means no revenue for the local insurance market as premiums are paid outside the country.
This is compounded by the fact that in cases where reinsurance occurs, oil giants involve their own captive insurance companies to oversee the whole process – reinsurance is an arrangement involving the transfer of all or part of a risk to another or more insurers to provide protection against the risk of the first insurance aimed at balancing the insurance market.
The country’s insurance legislation makes it compulsory to insure against risks on Mozambican soil, but this is not currently happening.
Mozambican insurers think government should include insurance issues in local content to ensure that part of the revenue earned by the industry stay in Mozambique, and transfer of knowledge.
Isaías Chembeze, Commercial Director of Emose, Mozambique’s state-owned insurer, said that by including local content in insurance, government would ensure that national interests are protected.
It remains to be seen whether Mozambican insurers do have the financial wherewithal to cover insurance risks in the oil and gas sector. Emose seems to think it does have some financial muscle, with Chembeze pointing out that Emose insured 10 per cent of the Italian oil company ENI floating platform
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