Insurance Sector on the Rise: BNA Assurances Joins the Tunis Stock Exchange
The Tunis Stock Exchange now hosts 7 players in the insurance sector with the introduction of BNA Assurances, gradually becoming a heavyweight in the market. By the end of last week, the insurance sector's market capitalization reached 1,766,050 MTND, accounting for 5.74% of the market's total capitalization. It occupies the fourth position, behind the unbeatable banks, agri-food and beverages (thanks to SFBT), and distribution. We believe that within a few weeks, insurance companies will find themselves on the podium, as the gap with distribution is only 43,110 MTND.
Excellent Prospects for the Insurance Sector
The sector's prospects are excellent, and we can confirm that they are better than those of banks and other financial services. The capacity for product diversification is the most significant. Moreover, with a low penetration rate, insurance companies still have a large local market to exploit. There is also a rare pricing power, rarely seen in the financial industry. Insurance companies can increase coverage prices without sparking the same level of protest and criticism as credit institutions. Car insurance policies will become increasingly expensive, especially with the progressive renewal of the vehicle fleet and the rise in electric and hybrid vehicles, which are costly to cover. Life insurance has become the second most important segment, thanks to the battery of tax benefits and double-digit growth.
Unbeatable Growth Potential
This double potential for growth, both in volume and price, is unmatched. Even the transition to IFRS standards will not have the expected impact on other financial institutions. In terms of dividend distribution, generosity is historically present. For those concerned about the effect of low interest rates on the profitability of credit institutions, insurance companies are a good alternative to maintain a position in the financial sector.
