Sub-Saharan Africa’s (SSA) reinsurers delivered a third consecutive year of double-digit return on equity in 2025. Pricing conditions have been stabilising since the first half of 2025, and whether the region’s reinsurers can sustain performance as the hard market cycle fades is the question AM Best’s latest segment report begins to answer.
Combined ratios for AM Best-rated SSA reinsurers peaked at 99.5 in 2019 and improved to 91.2 in 2025. The improvement reflected stricter risk selection and strong pricing actions in loss-affected markets such as Kenya. A general hardening of rates across the continent’s largest markets from 2023 to 2024 also contributed. Since the first half of 2025, pricing has been stabilising. At the 2026 renewals, rates improved in Anglophone West Africa but remained flat for most lines in East Africa.
Capital has grown, but the ability to retain risk has not kept pace. Despite aggregate capital growing to $3 billion in 2025, retention ratios for AM Best-rated SSA reinsurers fell to 78.6%, down from 87.5% in 2016. AM Best states that capacity from Africa-domiciled reinsurers remains insufficient to meet market demand and that local players often rely on support from global reinsurers.
As SSA economies have industrialised, insurance needs have grown faster than the local market’s ability to retain risk. The 2025 edition of this annual report flagged the same gap, particularly for complex property and energy exposures.
The divergence within the rated cohort surfaced in AM Best’s ratings table as well. SanlamAllianz Re Ltd, domiciled in Mauritius, was downgraded and placed under review with a developing outlook on October 2. Every other rated SSA reinsurer in the report carries a stable outlook. The downgrade is a reminder that segment-level resilience is not uniform across individual reinsurers.
West Africa’s capacity shortfall has been a recurring theme. Ghana Re addressed it directly at an industry seminar in July 2026, where sessions on treaty execution and the structural gap drew from the same AM Best findings.
SSA reinsurers’ direct exposure to losses from the ongoing Middle East conflict is limited. Most have war exclusions in place. The risk AM Best identifies is indirect: rising energy prices, supply chain disruptions, and inflationary pressures that flow through to some of the region’s economies.
For South Africa, a net oil importer, the conflict has pushed inflation up by 150 basis points since it began, based on May 2026 data. The IMF has revised downward its real GDP growth estimates for some SSA countries as a result. A prolonged conflict, AM Best notes, could squeeze underwriting margins and increase volatility in financial and currency markets.
Africa Re’s FY2025 results, published earlier this year, illustrate the broader trajectory. Gross written premium reached $1.34 billion, up 10% year on year. Net profit rose 51% to $199 million on the back of disciplined underwriting and record investment income. Africa Re underwrites roughly one-fifth of the continent’s reinsurance premiums. The full continental market generated $6.27 billion in premiums in 2024, which is 1.6% of global reinsurance underwriting.
“AM Best-rated SSA reinsurers are expected to remain resilient amid the current dynamic risk landscape, supported by good capital buffers that have grown in recent years,” said Naz Botea, senior financial analyst at AM Best. “The growing geographical diversification of invested assets and revenue further supports their resilience.”
