TheInsuranceIndustryinMauritius-national.pdfVIP

WP?5 3 03? POL[CY RESEARCH WORKING PAPER 3 034 The Insurance Industry in Mauritius Dimitri Vittas The World Bank Financial Sector Operations and Policy Department April 2003 POLICY RESEARCH WORKING PAPER 3034 Abstract The insurance industry is relatively well developed. It Large and medium-size companies have strong makes extensive use of reinsurance facilities and is free reserves, appropriate reinsurance arrangements, and from the pervasive premium, product, investment, and good profitability. However, several of the smaller reinsurance controls that have bedeviled the insurance companies have weak financial ratios and suffer from markets of so many developing countries around the long delays in settling claims. world. Insurance regulation and supervision is entrusted to Total premiums amounted in 2001 to 4.1 percent of the Financial Services Commission (FSC). The current GDP, while insurance company assets were equivalent to regulatory framework has many strong elements, 18 percent of GDP. including reliance on solvency monitoring, prudent asset Life insurance, which has been favored by generous tax diversification, international accounting standards, and incentives and has also benefited from the growth of actuarial methods. pension business and housing finance, represents 61 But there are some important gaps in corporate percent of total premiums. governance, internal controls, and risk management. In Nonhfe business is also well organized. Large addition, solvency ratios are below international industrial and commercial risks are reinsured with top standards and do not include modern risk-based capital