Somalia is changing. As we reported before, in ‘Shining a light on Mogadishu’, more and more investment is being channelled into civil infrastructure, capacity building, oil and gas, financial services, health, international transport – ports and airports.
Some of this investment is from Somali business people who had moved away during the civil war, showing new confidence in their country. Much of it is from Western, African and Chinese agencies, companies and organisations. And as these projects grow, the need for stable, dependable insurance to protect investments grows with it.
High-risk cover is a priority
Whilst Somalia is more peaceful that it has been in a decade, it is still a relatively volatile place to live and do business. High-risk cover for people, assets and investment risks is essential.
Adrian explains: “When you visit Mogadishu, you tend to stay in the heavily protected International Zone around the airport. You use local security advisors and armoured vehicles to get around.
“You wouldn’t want to put significant investment into Mogadishu or the wider region without high-risk insurance designed to cover you against things like war and terrorism, political violence or political evacuation.”
Optimism on the streets
Having said that, Adrian says that while you are there, you get a real sense of optimism for the future:
“It’s early days, but there is lots of international effort going in here. There is good engagement with leaders.
“When I did get out and explore the city (taking local security advice) I found it to be a fascinating place. It has beautiful ageing Italian architecture – you can see the potential straight away.
“You find friendly, open people. It’s a relaxed, equitable society where people meet you eye to eye and are happy to chat. English is the business language and most people’s second language, so it’s relatively easy to communicate.”
Takaful insurance – may be part of any contractual requirement
One less mainstream insurance requirement for companies operating here might be the need to comply with Islamic-based ‘Takaful’ insurance, which is a kind of not-for-profit pool arrangement, a bit like a ‘mutual’ framework.
Adrian explains that there are ways to meet these requirements and still get robust international protection.
“We are working with local insurance brokers who meet all of the Takaful requirements. We can then provide re-insurance through international markets to ensure that risks are robustly covered.
“It’s a win-win arrangement. Our clients support the local market and help to grow capacity and can still be assured that risks are properly covered.”
Adrian Henry is a senior broker for Bellwood Prestbury, creating bespoke high-risk insurance cover for organisations all around the world.