VAT, withholding tax, digitalisation, book IV…, several projects remain unfinished, which hinders the progress of insurance intermediaries. Added to this is the measure of withholding tax set out in the PLF 2023 which discusses… In this matter, FNACAM shows its optimism while calling for more commitment from the various stakeholders in completing the projects by classes.
Farid Bensaid, president of the National Federation of Insurance Agents and Brokers in Morocco (FNACAM), wants to see concrete and frank things to promote the profession. He made this clear in his opening speech delivered at the 6th Annual Meeting of Insurance Agents and Brokers held on Wednesday in Casablanca. “At a time of strong economic tension around a difficult post-Covid recovery, a handicapped PLF 2023 for our sector and a worrying drought, it is important to close our ranks around a strong FNACAM, which raises the standard for insurance intermediaries, regardless of whether they are agents or brokers, small or large,” he said.
The new conditions for access to the profession, the project to revise the contract of employment, digitization, signing on behalf of others… these are just a selection of the many projects that the Confederation wants to get started as soon as possible, given the current issues and challenges facing members in a rapidly changing market.
Withholding at the source makes people cringe
Added to this is a current topic, namely the provision published in PLF 2023, on deduction at source of IS on fees, commissions, brokerage and other remuneration of the same nature. The latter is proposed to be revised upwards to 20% instead of the current 10%.
In fact, insurance intermediaries (general agents and brokers) strongly object to this provision, which is considered to be “disconnected from the reality of their activity”. According to them, this constitutes a further limitation, while their income is disclosed by the insurance companies to the Directorate General for Taxes (DGI) and to the Supervisory Authority for Insurance and Social Welfare (ACAPS). In any case, according to the president of FNACAM, “negotiations are ongoing.
We count on CGEM’s commitment to bring a change to this measure.” If retained in the 2023 Finance Bill, it will only weaken most insurance agents and brokers and will accelerate the sector into an unprecedented crisis, or even an irreparable failure of its most important distribution channel, Federation worries.
Towards more diversification
While awaiting the continuation of the events linked to PLF 2023, FNACAM is working on other important projects for its growth, which were discussed at its 6th annual meeting, held with the theme, as stated above: “the future of the acquired insurance intermediary, innovative solutions in in the light of a rapidly changing market.” A topic that the Interim President of ACAPS, Othman Khalil El Alamy, finds relevant in light of the regulatory developments the profession is experiencing.
He also encourages the players concerned to “get out of their comfort zone to seek out customers and develop optional insurance. I believe that there are sources of growth that remain untapped and that it is up to insurance intermediaries with the support of insurance companies to develop them”.
ACAPS is currently considering the possibility of allowing its members to carry out new activities (to diversify their sources of income), such as payment services (transfer of funds, payment of invoices, collection of taxes and duties, …) or handling of claims on behalf ( claims from contracts to which you are not a contributor) and certain administrative services (health records on behalf of the CNSS, or driver’s license and vehicle registration applications for Narsa) .
“Through this opening, we hope for a positive impact on the material situation of the profession’s actors, insofar as it is a matter of paid services”, assures El Alamy. However, beyond this aspect, “we believe that this openness will, as a minimum, allow the profession to increase its expertise and increase its contribution to important projects for the country, such as the national strategy for financial inclusion. and the expansion of social protection” . confirms the interim president of ACAPS.
Regarding the overlap of the activities of insurance intermediaries and the activities of the own network of insurance companies, Mohamed Hassan Bensalah, President of the Moroccan Federation of Insurance and Reinsurance Companies (FMSAR) confirmed that “the development of new distribution channels does not represent a threat for agents and brokers, but comes as reinforcement to drain a new clientele”. And to add that “despite what one might think, the traditional network will remain the reference channel for the distribution of insurance products, especially for life insurance and non-life guarantees , which requires expertise and advice. “.
Book IV to a realization
The draft amendment to Book IV of the Insurance Act, which was much anticipated for several years, has been taken up by the sector regulator. For several months, a joint commission – made up of representatives of Tilsynet and representatives of the Ministry of Finance – has been working on the subject. This commission, which has begun the phase of drafting the law, holds meetings at a very persistent pace (twice a week. It has set itself the goal of arriving at a stabilized draft by the end of it. As soon as the project is completed , we will initiate consultations with the various stakeholders.
Insurance agents and brokers in numbers
Insurance intermediaries represent a network consisting of just over 2,000 sales points between agents and brokers. These players remain the preferred distribution channel for policyholders, ahead of bancassurance companies and direct management offices. They drain premiums at 57%, compared to 30% for bancassurance companies and 13% for direct management offices. Of the 4 billion dirhams in commissions, the intermediaries receive about 3.6 billion dirhams (88%), the rest (12%) goes to the bancassurance companies. Of this amount, 1.5 billion dirhams come from cars, 367 million dirhams from health insurance and 310 million dirhams from occupational accidents.
Sanae Raqui / ECO Inspirations