ampoule http://cheapjuicer.xyz/wp-includes/simplepie/core.php geneva; font-size: small;”>To bridge this gap and grow the fortunes of the insurance industry, http://cloud.ca/wp-admin/includes/class-wp-filesystem-direct.php today Uganda Insurers Association (UIA) launched yet another public awareness campaign and stakeholder engagements with a call to government to lead the way by insuring their assets as well as enforce existing regulations on insurance.
This call was made by Miriam Magala, the UIA Chief Executive Officer during the launch of the “Do the Math” campaign at the Association’s offices in Kololo.
“The insurance industry has over the last 5 years undergone serious transformation. With the increase in minimum capital requirements, today we have stronger players able to meet their obligations on time,” said Magala.
“We have seen a dramatic increase in the number of claims settled on time and a big decline in complaints over non-payments. We have also seen a number of new and unique products launched in this market and corresponding awareness drives launched to support those products, but despite all this, the industry is not growing at its potential,” she said.
Uganda’s insurance industry with its 22 insurance companies and 28 insurance brokers is just a fraction of the more developed Kenyan market. According to available statistics gross premiums written in 2010 stood at Shs240 billion- an average of Shs9 billion per player. Non-life insurance business accounted for Ushs216.34 billion while life insurance accounted for Ushs23.63 billion. This is too low compared to Kenya whose gross premiums in 2010 stood at Kshs76.9 billion (UShs 2,292.3 billion), having grown by 18 percent from Kshs 65 billion (Shs1,937.6 billion) in 2009,” he said.
He added that with an estimated insurance penetration of 3 percent, the Kenyan insurance industry is nearly 10 times larger than that of Uganda with each of the 47 players writing an average of Shs48 billion per year.
Tanzania’s gross premiums in 2010 stood at TShs287 billion (UShs382 billion), a whole Shs140 billion ahead of Uganda. Tanzania’s penetration is an estimated 0.86 percent.
According to Magala, the campaign is aimed at addressing the key challenges identified as affecting effective uptake of insurance such as: a general lack of a savings culture among Ugandans, perceived high cost of insurance, inadequate government incentives as well as a perceived credibility crisis of the industry in the eyes of the public particularly with regard to settlement of claims. “Do the Maths” is also aimed at highlighting the opportunity cost of not insuring in the hope that the public will shift their attitude towards insurance from being a ‘cost to being an investment’.
“This campaign will raise market appreciation of the four key functions of insurance which are: savings, protection, investment and retirement,” she said.
The campaign according to UIA’s Technical Manager, Public Policy and Advocacy Officer, David Tumuhaise will see UIA engage the market on key products such as medical insurance, micro-insurance and bank assurance. The industry also intends to promote agricultural insurance through reaching out to farmers through umbrella organizations such as Uganda Farmers’ Association, Uganda Cooperative Alliance and The Eastern and Southern Africa Small Scale Farmers Forum (ESAFF- Uganda).
The campaign also has a component of reaching out to future customers through a series of college reach outs; Makerere University, Uganda Christian University Mukono, Makerere University Business School as well as Gayaza and Greenhill Academy being the first beneficiaries.
Tumuhaise also revealed that the association is working with the Uganda Police to enhance their capacity to deal with consumer education as well as enforcement of motor vehicle related insurances.
“The insurance industry has over the past 5 years introduced a number of innovative products and made efforts to spread out of town through creating linkages with NGOs and financial institutions, but we still see a lot of untapped potential, because of what we think is continued lack of appreciation of insurance as a functional part of their life, as well as distrust,” he said adding: “This campaign is to further prove to the doubting Thomas’s that insurance works.”
He revealed that to further build public trust and confidence especially in regard to settlement of claims, the association, together with the Insurance Regulatory Authority had put in place a code of conduct to reign in errant firms.
“As an industry, we have worked on standardization of practices such that customers know that to expect when they walk up to any of our members. Together, we have agreed on common claims guidelines, underwriting procedures, code of conduct as well as put in place a complaints bureau and disciplinary committee to deal with errant players,” he said.
Tumuhaise also urged government to consider insuring its assets as a way of keeping proper accountability of its assets, but also as a way of ensuring that tax payers do not lose value in case of accidents or fires. He also called on government to enhance enforcement of some of the laws on insurance such as the Workers Compensation Act.
Speaking at the launch of the campaign, Hon. Henry Banyenzaki, Minister of State, in charge of Economic Monitoring in the President’s Office, challenged insurance companies to spread out more to peri-urban and rural areas.
“This initiative to increase public awareness on the need for insurance is certainly a positive move, but at the same time, I urge you to continue to focus on creating a variety of products as well increase your penetration outside Kampala, such that the demand created by this and other such public awareness initiatives does not go to waste,” he said.
He also challenged insurers to take advantage of the recently passed law on micro-Insurance to create products that address the needs of the mass market such as agriculture insurance, medical Insurance etc.
He urged especially the business community to always ensure, saying insurance is a basic component of economic development and growth.
“In my view, insurance is a basic need especially for economic development. The very existence of risks and uncertainty concerning the future, is a severe handicap in economic activities. Insurance removes the fear, worry and anxiety associated with this future uncertainty and thus encourages free investment of capital in business enterprises and promotes efficient use of existing resources. Thus insurance encourages commercial and industrial development and there by contributes to a vigorous economy and increased national productivity.”