COTE D’IVOIRE Law and Practice Contributed by: Assemian Kouakou, Innocent Kouakou, Francky Lukanda and Lamine N’Diaye, Ofori Conseils Africa LLP
The regulator also emphasises regional preference in reinsurance and compliance with solvency, govern- ance and anti-money laundering and counter-terrorist financing obligations. Insurers must demonstrate the technical consistency of the transfer, the soundness of the reinsurers selected and the documentary compli- ance of the transaction, all of which must be available for presentation to national or regional authorities at any time. In practice, fronting therefore remains pos- sible but is only accepted within a rigorous prudential framework, based on a 50% retention, documentary transparency and a real operational role for the local insurer. 4. Transaction Activity 4.1 M&A Activities Relating to Insurance Companies The insurance market in Côte d’Ivoire is growing rapidly and undergoing gradual consolidation, with mergers, the creation of subsidiaries and the restruc- turing of holding companies aimed at strengthening capital and governance. African and foreign inves- tors are attracted to the life insurance, property and casualty insurance, bancassurance, insurance holding companies and insurance brokerage segments. Any acquisition of more than 20% of the share capital of an insurance company or a parent company (hold- ing company) of insurance companies requires prior authorisation from the regulator. This type of transac- tion must also be notified to the WAEMU Competition Commission for prior approval before completion. The market factors that could affect merger and acquisition activity or are likely to do so in the future are mainly market growth and technological innova- tions (insurtech and the digitalisation of insurance and reinsurance operations). In terms of regulatory fac- tors, these include the relaxation of existing regulatory requirements, particularly the implementation of single authorisation within the CIMA zone. The principle of the single licence means that an insurance or reinsur- ance company can obtain a single authorisation in one CIMA member state, allowing it to operate in the 13 other CIMA member countries without having to obtain an individual licence in each jurisdiction.
The single authorisation is seen as a solution to improve the profitability of companies and reduce investment costs in the insurance sector within the CIMA zone. 5. Distribution 5.1 Distribution of Insurance and Reinsurance Products In Côte d’Ivoire, the distribution of insurance and rein- surance products is governed by the CIMA Code and supervised locally by the National Insurance Directo- rate. The market mainly involves brokers, agents and general agents, bancassurance (BIM) which is highly developed for life insurance, and certain property and casualty risks, as well as direct sales and new digital channels. Insurance intermediaries must comply with strict requirements in terms of good repute, capacity, financial guarantees and training, based on Article 500 et seq of the CIMA Code, while reinsurance continues to be brokered between professionals via specialised brokers. Distributors are also subject to transparency and pre-contractual information requirements, as well as anti-money laundering and counter-terrorist financ- ing rules. This framework ensures both the protection of insured persons and the compliance of transac- tions, while allowing the development of new distribu- tion models on the Ivorian market. 6. Making an Insurance Contract 6.1 Obligations of the Insured and Insurer In accordance with the provisions of the CIMA Code, when an insurance contract is negotiated, the insured has no general obligation of spontaneous disclosure. They must simply answer the questions asked by the insurer in the risk declaration form in good faith, while the insurer has an obligation to formulate a clear and comprehensive questionnaire and to carry out the necessary checks. Unintentional omissions on the part of the insured result in a proportional reduction in compensation, while intentional misrepresenta- tions may result in the contract being declared null and void. The insured must also declare any increase in risk anticipated by the insurer during the term of the contract. The legal regime is the same for consumer
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