Uganda insurers see Bancasurrance lifting business

September 23, 2016 in Business, Companies, Financial Services by Editor

KAMPALA, SEPTEMBER23 – Players in Uganda’s insurance industry are seeing Bancassurance as a possible booster of the perpetually low penetration figures despite the many active insurance companies.

During a consultative workshop on the proposed Insurance (Bancassurance) regulations 2016 this week, industry players welcomed the proposed policy move saying it would not only help boost the penetration currently
at a paltry 0.756pc after the GDP was rebased, but a partnership with banking would also boost public confidence in  insurance.

“We believe the collaboration between insurance players and banks will play a great role in increasing the insurance penetration levels because banks have a wider presence all over the country which insurance providers can tap into to sell insurance,” said Insurance Regulatory Authority CEO Kaddunabbi Ibrahim Lubega adding that the experience of countries such as France Bancassurance is already working point to benefits of convergence for Uganda.

Reacting to fears that the entry of Bancassurance would kill the insurance companies given the competition from the bank’s whose presence is already widespread,, Maurice Amogola the CEO AON says “the coming of banks on board will work for us because we will see many people taking up insurance and banks will need the insurers because they do not have people with the required skill to sell insurance.”

And on whether banks wouldn’t use Bancassurance to undercut insurance companies once insurance cover has been taken out or to coerce clients to take out insurance against their will, Kaddunabbi said the regulator would fight the vice and once such allegations are proved, the culprit would be liable to pay a fine of Ushs 50million and would have their license revoked.

Banks that will wish to sell insurance through Bancassurance will have to get certificates from the IRA and must have a Bancassurance principal officer and a specified person at the branch from where Insurance will be sold.