In­sur­ance in Uganda grows 16pc in 2017

The East African - - BUSINESS - By DICTA ASIIMWE Spe­cial Cor­re­spon­dent

UGANDA’S IN­SUR­ANCE sec­tor, long dogged by low pen­e­tra­tion, recorded a 16 per cent growth in rev­enue buoyed by in­creased up­take of med­i­cal and agri­cul­tural in­sur­ance in 2017.

The sec­tor made some Ush737.2 bil­lion ($195 mil­lion) up from Ush634.8 bil­lion ($168 mil­lion) in 2016, thanks to the rise of non-life in­sur­ance, which had been in de­cline fol­low­ing an in­crease in taxes in 2013 and 2014.

Non-life in­sur­ance con­trib­utes more than 70 per cent of in­sur­ance pre­mi­ums.

The rise in non-life in­sur­ance was put down to the gov­ern­ment’s in­vest­ment in an agri­cul­tural sub­sidy that has been run­ning for two fi­nan­cial years now, and pri­vate sec­tor up­take of med­i­cal in­sur­ance for staff.

In­sur­ance Reg­u­la­tory Author­ity chief ex­ec­u­tive Ibrahim Kad­dun­abi Lubega, said non-life pre­mi­ums grew by 14.7 per cent in 2017.

This is the first time non-life in­sur­ance has grown at more than 10 per cent over the past three years. Non-life pre­mi­ums grew 14.7 per cent from Ush450 bil­lion ($119.4 mil­lion) in 2016 to Ush516 bil­lion ($136.9 mil­lion) in 2017. In 2016, non-life pre­mi­ums de­clined by 3.1 per cent.

Mr Kad­dun­abi says im­proved performance of the in­sur­ance sec­tor is due to more peo­ple tak­ing up agri­cul­ture and med­i­cal in­sur­ance.

Agri­cul­ture in­sur­ance was boosted by the Ush5 bil­lion ($1.3 mil­lion) of­fered by gov­ern­ment to pro­vide a 50 per cent sub­sidy for com­mer­cial farm­ers and 70 per cent for small scale farm­ers. As a re­sult of this sub­sidy, pre­mi­ums from agri­cul­ture in­sur­ance stood at Ush10.1 bil­lion ($2.7 mil­lion).

Mr Kad­dun­abi said more com­pa­nies have taken out med­i­cal in­sur­ance for their em­ploy­ees. Med­i­cal in­sur­ance pre­mi­ums, which bring in the most money in the sec­tor in Uganda — a po­si­tion pre­vi­ously oc­cu­pied by mo­tor ve­hi­cles — grew 33.2 per cent, from Ush121 bil­lion ($32.1 bil­lion) in 2016 to Ush161 bil­lion ($42.7 mil­lion) last year.

Pic­ture: File

Vis­i­tors at the Bank of Uganda stand dur­ing a bank­ing and in­sur­ance expo in Kam­pala.

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