Insurance Innovation Dialogue; Opportunities in the time of COVID-19
The Insurance Regulatory Authority (IRA) of Uganda, in partnership with FSD Uganda and the Innovation Village, hosted an interactive virtual workshop on 19th November 2020, to discuss the opportunities and challenges to innovation in the Ugandan insurance market.
The Chief Executive Officer, Alhaj Kaddunabi Lubega said the workshop was the perfect opportunity for the industry players to discuss innovation in the sector amidst COVID -19. “With the onset of COVID 19, it has become apparent that the traditional way of thinking and doing business will not grow the insurance industry. We must come up with innovations, and business models that will help mitigate the challenges,” he said.
The participants discussed several issues affecting the industry ranging from new ways of broadening their customer base; reviewing regulatory obstacles; simplifying the customer journey to the digitalisation process in the insurance industry.
Ms Jackie Kitiibwa, Head of Business Environment at FSD Uganda said the workshop was designed to promote open and transparent communication between the regulator and industry and facilitate learning from each other. She added that such engagements are a critical element of regulatory policy and inclusive policy making. While the fallout from the crisis is both intensifying familiar risks and creating new ones, disruption at this scale also creates new opportunities.
The Uganda insurance industry has remained resilient during the crisis recording growth of 8% – 11% in the first three quarters of 2020 compared to the same period in 2019. The pandemic has also increased the awareness and demand of insurance products and created opportunities for new business models, new products, and new customers.
Insurance penetration in Uganda remains low as the majority of Ugandans are not covered by insurance. The latest Fin Scope (2018) data reveals that only 1.4% of Ugandan adults have any form of insurance and to a great extent, innovation in the Ugandan insurance industry also remains limited.
The same report reveals that 61% of Ugandans face insurable risks (the most prevalent of which is health-related, followed by agriculture and death). Many Ugandans not only require insurance, but they also have the means to afford it with 3.76 million adult Ugandans earning more than USD10 per day.
As such, there is a significant opportunity for providers to expand insurance uptake. This will require sector players to actively pursue innovation and explore ways to meet the potential and current consumers’ needs.
The workshop that was moderated by Cenfri, was attended by the regulators, current and potential industry players in Uganda.