The Independent Uganda: You get the Truth we Pay the Price
Kampala, Uganda | PATRICIA AKANKWATSA | Goldstar Insurance, a prominent player in Uganda’s insurance industry, received a significant accolade as the Global Credit Ratings (GCR), an independent South African organization, upgraded the company’s national scale financial strength rating to AA (UG) from A+(UG).
This remarkable advancement underlines Goldstar’s robust financial standing, characterized by exceptionally strong risk-adjusted capitalization and liquidity.
While addressing the media on October 17th at Kabira Country Club, John Kawuma, the Chief Executive Officer of Goldstar Insurance, shared insights into the factors behind this substantial rating upgrade.
He credited the transformation in the board composition, aligning it with regulatory requirements, as a pivotal factor contributing to this development. Additionally, the insurer’s persistent position in the competitive landscape played a role in an enhanced business profile assessment.
“In Uganda, it is on record that Goldstar exhibits a strong financial profile, characterized by very strong risk-adjusted capitalization and liquidity, while the earnings capacity assessment factors in sustained underwriting profitability and continued sound net earnings,”
The CEO highlighted the importance of the GCR’s independent evaluation, noting that this transparent process reinforces trust and credibility in the insurance sector. He emphasized the significance of external validation.
“The double to AA has been a ten-year journey, you approach them, they say you are not good enough, then you are good enough in this, so it’s been a very transparent process, so you would rather live with an independent opinion than me talking about myself,”
Kawuma acknowledged the persistently low insurance uptake in the country, a challenge faced by the entire insurance industry. He highlighted the need for insurers to bolster their resources to meet claims, viewing it as a catalyst for increasing insurance adoption.
“One, the insurers have to continue to strengthen their resources to pay claims as this will work as a catalyst to encourage insurance uptake in the country.”
Enock Mudadi, the Goldstar Chief Operations Officer told reporters that the new rating reflected their drive to match their services to international standards.
“Even though we are a local insurer, the expectation is that we must deliver services on globally acceptable standards. Besides, our customers are not necessarily local, some of them are
multinationals working in this country, others are regional companies,” he said.
Goldstar Insurance’s ascent to an AA rating is a testament to its unwavering commitment to financial stability and excellence. It also underscores the critical role of independent evaluations in building trust and transparency within the insurance sector. While Uganda faces insurance uptake challenges, the industry is poised to strengthen its resources, paving the way for greater adoption in the future.
