The Independent Uganda: You get the Truth we Pay the Price
The insurance industry recorded Shs1.6trillion in premiums last year but motor third party accounted for only one percent
Kampala, Uganda | THE INDEPENDENT | Insurance sector leaders are calling on the government to implement measures ensuring that all motorists secure mandatory motor third-party insurance, aimed at safeguarding road accident victims.
Speaking to journalists at the CEO Club event held in Kampala on Aug.30, Jonan Kisakye, the Chief Executive officer of Uganda Insurers Association (UIA) said out of the Shs1.6trillion premiums that were underwritten by insurance companies last year, motor third party accounted for only one per cent.
He noted that while approximately half a million vehicles purchased motor third-party insurance, the country is estimated to have over one million vehicles.
On their part, Kisakye said UIA would continue to embrace partnerships to create awareness about the benefits of insurance and deepen penetration, which has stagnated at around 1% for many years.
Uganda’s insurance sector penetration continues to be limited to a few Ugandans attributed to limited awareness of available products, limited usage of technology, and few product innovations.
The other hindering factor relates to limited income streams by the majority of the population to prioritize spending on insurance.
Ruth Namuli, the Chairperson of the Uganda Insurers Association Executive Committee and CEO of Sanlaam General Insurance Company said digitization, product innovation, stakeholder engagement, and over-technology usage are critical for driving insurance uptake.
“We will work with the regulator to have in place initiatives to involve more Ugandans in insurance,” she said.
She added: “We plan to continue with the initiatives in place riding on technology and digital solutions that enhance product development. We will also engage on issues of environmental social and governance to be competitive globally and sustainable.”
Namuli said plans are also underway to push for avenues to combat fraud claims in the industry by working closely with the regulator to create what she called a special reference bureau to deal with this industry threat.
The Chairman of the Insurance Brokers Association of Uganda, Paul Muhame supports the idea of CEOs in insurance to work with the regulator to routinely improve customer satisfaction levels and drive the update of insurance – aligning to the fact that some insurance companies ‘complicate matters when it comes to paying claims.
In July, the Insurance Regulatory Authority of Uganda (IRA) said Uganda’s insurance industry registered a robust growth rate in 2023 due to enhanced insurance customer confidence, improved distribution channels, and growth in online transactions.
The industry’s gross written premiums for all types of insurance grew by 11.29% in 2023 from Shs1.44 trillion in 2022 to Shs1.6 trillion during the period.
Kaddunabbi Ibrahim Lubega, CEO of the Insurance Regulatory Authority of Uganda, said enhanced claims payment, consumer empowerment, and strengthened complaints redress mechanisms provided by the Authority have increased customer confidence in the sector, leading to increased uptake of insurance services.
He said the IRA’s Complaints Bureau also realised an increase of above 40% in the number of received complaints due to enhanced awareness creation in the industry, which has seen many complainants coming to enforce their rights.
