A 100% Angolan insurance and reinsurance brokerAugust 28, 2023
Tiago Dá Mesquita, CEO of Zillian, talks to The Energy Year about how the company has evolved since the creation of the Zillian brand and the key advantages it will have as a 100% Angolan-owned company. Zillian – formerly Aon Angola and presently Aon’s exclusive correspondent in Angola – is an insurance and reinsurance broker.
How has Zillian been evolving since the creation of the Zillian brand?
Operationally, much of what we do is the same as before because our team has remained the same. Our clients and our partners, the insurance companies, have also remained the same. However, other aspects of our business changed a lot.
We have changed our core insurance system. We implemented new digital solutions for our clients that provide them with 24/7 access to their policies, claims data and everything else. We also implemented systems to help us with handling client requests and to improve our overall service quality. We’re also working on our website.
Handling our day-to-day business and making the transition with our relatively small team of about 30 colleagues has not always been easy, but we’re getting there.
What are the key advantages and opportunities for Zillian as a 100% Angolan capital company?
The first advantage we see is in terms of flexibility. The changes we are implementing bring us closer to what our market and clients request from us. Sometimes, when you’re in a large multinational company, certain things move slower. When you’re independent, you can implement certain changes faster, go to market with them faster and provide a better service for your clients.
On the other hand, I like to say that we have the best of both worlds. We’re independent, so we’re more agile, but we’re still a part of a large group and network, although in a different way than before. Now, we’re a correspondent as opposed to a subsidiary.
Another advantage we have relates to the local content law. As a 100% Angolan-owned company and given that insurance brokerage services are under the exclusivity regime, we’re well positioned to continue serving our clients in the oil and gas industry.
However, we’re seeing that the local content law is being enforced more for the operators than for the general service providers in the industry. It’s being enforced for five or six operators and not for the other companies to which the law applies. Nevertheless, I believe that this is a gradual process. I’m confident we have the skills, capabilities, knowledge and local and international connections to continue to serve our clients better and better.
How has the exposure of Zillian to the Angolan energy sector been evolving in the past years?
The energy sector has always been a large part of our client portfolio, which is more or less obvious because a large part of the Angolan GDP comes from oil and gas.
I could separate our involvement with the industry into two directions. The first regards direct or retail insurance. We’ve always worked with many service providers in the industry and with operators.
The second and more significant way in which we’re involved with the industry is through reinsurance. We currently place the policies for six blocks in the London market with our partners Aon. We are also involved in placing reinsurance for FPSOs and for offshore construction projects. Our involvement comes chiefly from those projects.
We continue to see most of our clients growing and winning new projects. We see many offshore construction development projects, which we understand are translating into increased production or at least mitigating the decrease in production we’ve seen in the past few years.
How do you assess the recent legislative and regulatory changes in the Angolan insurance sector?
The new 2022 insurance law is interesting. For example, it introduces the concept of microinsurance in a country where you don’t have a middle class. The penetration ratio or percentage of insurance in the GDP in Angola is less than 1%.
In other countries in our region, this percentage is between 3-5%. These markets are mostly comprised of life insurance, and why is that? The reason is because accessing financing is easier, and there’s a larger middle class. In a country where families don’t have income to spend on classic insurance – which is expensive for most families – the solution may be microinsurance.
The new insurance law has now defined what microinsurance is, who can market it and the concept of the micro-insurer as distinct from a general-purpose insurer. There’s already one product from one insurance company, ENSA, that one could consider microinsurance.
We were involved in the public consultation that ARSEG held regarding the new insurance mediation law. It’s supposed to be enacted within the next six months. It will introduce higher demands on brokers with respect to the way they present themselves and organise their work and in terms of their obligations towards clients, regulators, insurance companies, etc. It will also define which non-broker entities can market insurance products.
How well positioned is Zillian in an increasingly competitive insurance market?
I think we’re very well positioned, but we constantly strive to exceed ourselves. 2024 will mark our 20th anniversary in the Angolan market. During this time, we’ve come to know the market very well and have a consolidated team with a low turnover rate.
The connection we have – and will continue to have – with Aon has brought us international access, which is important for many clients. This connection gives us the ability to place reinsurance in the best markets. We have unparalleled access to the best insurance markets in the world, including those in London, continental Europe, Asia and the US.
We continue to invest in technology solutions to make our clients’ lives easier while making them more resilient to risks and losses.
What are some of the key economic segments that Zillian is targeting?
In the short to medium term, it’s industry. Industry is growing. The Minister of Industry has recently said that from 2021 to 2022, industry grew by 6%. Of course, we have a long way to go, even when compared to other countries in the region. However, we see that investment in industry is growing. It’s not oil and gas, but we are starting to see that our own portfolio in industry is increasing. It’s an area for the short and medium term.
In the long term, we’re targeting agriculture. Agriculture will hopefully play a large part in the country’s economy and in our portfolio as well.
Clean and new types of energy I think will be significant in the future as well. Solar power is the main one with potential. Regarding onshore exploration and production, we’ll also start to see more in this area. It’s a bit of a shift in the paradigm of the Angolan oil industry. That’s where we see things happening.