The Independent Uganda: You get the Truth we Pay the Price
Players are changing tactics to deal with the sector’s penetration headache
| THE INDEPENDENT | Why has Uganda’s insurance penetration remained below 1% for many years? This is the question that has been asked several times and players continue to scratch their head to answer it.
The public will be waiting to see how the new tactic that the Insurance Regulatory Authority of Uganda (IRA) and other partners have planned will answer the above the question.
IRA together with others, has organised the inaugural Insurance week which starts on Monday March 7, 2022 and the main objective is to sensitise the public about the need to buy different insurance policies to manage risks.
“We want to drive insurance to the lowest person so as to increase the penetration,” said Ibrahim Lubega Kaddunabbi, the chief executive officer of IRA on March 03 in Kampala, ahead of event launch.
The week will bring together all stakeholders in the insurance industry including insurance brokers, insurance companies, bancassurance agents, insurance agents and health membership organisations.
Kaddunabbi said, the activity will educate the members of the public about the different insurance policies available including workers compensation, life and medical, agriculture, motor insurance. The other areas will include, claims and rights and obligations of the public and insurance companies.
The other key issue that Kaddunabbi said, will be telling the public that any policy that they seek from any insurer must have a ‘key fact statement’ so they are able to understand all details about the policy before signing for it.
“We are optimistic the various activities will empower people to take decisions in as far as risk management is concerned,” he said.
Paul Kavuma, the chief executive officer of Uganda Insurers Association said, they will use the seven days to advocate for good insurance and ensure that trust unites the insurers and the general public when it comes to the uptake of policies.
“Members are upbeat about this week,” he said, “We will have to explain what one requires to know before taking up any policy.”
Solomon Rubondo from the Insurance Brokers Association of Uganda said, it is timely for players to get together and improve the image of the sector by engaging members of the public.
He said, the key questions to ask amongst themselves is whether they are selling the right products to the right people at affordable price, and paying the right claims.
“We will do this by listening to people and put their voices in the products that we have,” Rubondo said.
Jonan Kisakye, the deputy principle of the Insurance Training College – Uganda said, players need to use simple language to explain insurance policies on offer.
He also said, that higher institutions of learning will need to adjust their curriculum to further include the new dynamics of insurance as part of the efforts to educate the public about insurance in general.
“This is a great opportunity for us to approach insurance and address issues common to us; it shows, we are moving from individualism to togetherness,” Kisakye said.
Patricia Amito, the head of communications and corporate affairs at Uganda Bankers Association said, matters insurance education requires a joint effort to deepen penetration. Amito said, banks have 15, 000 agents handling insurance business and that digitization is the direction that banks are taking to further offer insurance services and directly boost the uptake of different products.
Sector performance
Uganda’s insurance industry is projected to register consistent growth in 2022 riding on technology innovations, government’s investment in infrastructure and increased economic activities as economy recovers.
In a recent interview with The Independent, Kaddunabbi said, that the projection is premised on a fairly impressive performance of 2021 where the industry is estimated to have grown at about 11% amidst several disruptions.
Latest statistics from the IRA shows that that the industry’s gross written premiums as the end of the third quarter of 2021 shrugged off the effects of COVID-19 to record a 16.87% growth in premiums to Shs 911.9bn compared with the same period in 2020. Uganda’s insurance industry has consistently recorded a surge in insurance business with the gross written premiums increasing from Shs 463billion in 2013 to Shs1.06trillion in 2020 on the back of government investment in infrastructure such as Karuma and Isimba Power Dams, Kampala-Entebbe Expressway and Entebbe International Airport expansion.
Going forward, Kaddunabbi said, “I would like to rally the public to take up insurance because the insurers of today are much better than those who did it before.” Uganda’s insurance penetration remains below 1% compared to South Africa, Namibia, Lesotho and Kenya, whose insurance penetration stands at 16%, 6.6%, 4.7% and 3.4%, respectively.
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