Zim in­sur­ance ser­vices ‘elit­ist’, need re-mod­el­ling

Chronicle (Zimbabwe) - - Business - Leonard Ncube and Hazel Hweta Vic­to­ria Falls Re­porters

IN­SUR­ANCE com­pa­nies should repack­age their prod­ucts to make them af­ford­able to low in­come earn­ers who con­sti­tute the bulk of the pop­u­la­tion and can­not af­ford ex­pen­sive poli­cies cur­rently on the mar­ket.

This was said by the Per­ma­nent Sec­re­tary (non-ac­count­ing) in the Min­istry of Fi­nance and Eco­nomic Devel­op­ment Dr Ju­dith Ka­teera at the Zim­babwe Mi­cro-In­sur­ance Sum­mit in Vic­to­ria Falls on Tues­day.

Dr Ka­teera, who is re­spon­si­ble for pol­icy mak­ing in the Fi­nance Min­istry, said most in­sur­ance com­pa­nies were fail­ing to pro­vide ser­vice be­cause they were elit­ist and spend the bulk of their money pam­per­ing their boards and man­age­ment at the ex­pense of the de­serv­ing needy cit­i­zens.

As a re­sult, only 30 per­cent of the coun­try’s pop­u­la­tion is in­sured as in­sur­ance cover is way be­yond reach.

“All we are say­ing is that in­sur­ance com­pa­nies should be able to cover the poor and as such we are en­cour­ag­ing them to re­struc­ture and in­clude the least paid in their prod­ucts,” said Dr Ka­teera.

“Some in­sur­ance com­pa­nies fail to pro­vide ser­vice be­cause of high ad­min­is­tra­tive costs, which are just too high be­cause of pack­ages and al­lowances for man­age­ment hence less money is left for clients. The in­sur­ance com­pa­nies should re­visit their bud­gets than to fo­cus on main­tain­ing lav­ish life­styles for boards and man­agers at the ex­pense of the poor de­serv­ing peo­ple.”

Dr Ka­teera said sta­tis­tics show that 70 per­cent of the coun­try’s pop­u­la­tion lives in ru­ral ar­eas where they de­pend on agri­cul­ture, which is at greater risk of cli­mate change and floods hence the need for them to be cov­ered in their agri­cul­tural pro­duc­tion.

“Only 30 per­cent of Zim­bab­weans are in­sured one way or the other and that means we’ve 70 per­cent at risk. As Gov­ern­ment we are try­ing to reach out and bring the poor into the eco­nomic sys­tem and our take off point is to un­der­stand the ex­tent to which the gen­eral pub l ic know about ben­e­fits of in­sur­ance and look at how many ser­vice providers have cover on health, agri­cul­ture and oth­ers,” added Dr Ka­teera.

She urged in­sur­ance providers to struc­ture their prod­ucts in a way af­ford­able to peo­ple as well as move dig­i­tal so that even those in the ru­ral ar­eas can trans­act in the com­fort of their home­steads with­out wast­ing money and time go­ing to town.

Dr Ka­teera who was guest of hon­our at the workshop, said the onus lies with in­sur­ance com­pa­nies to re­po­si­tion them­selves and em­brace the poor since the mi­cro-in­sur­ance con­cept is based on num­bers, which will re­sult in cheaper and af­ford­able poli­cies.

“As Gov­ern­ment we say as we lib­er­alise, we al­low many play­ers to come in and we will de­fine rules through the reg­u­la­tory frame­work, which is why we are con­sult­ing so that we agree on a num­ber of is­sues,” she added.

The workshop was or­gan­ised by Afri-Sure, in con­junc­tion with In­sur­ance and Pen­sion Com­mis­sion (IPEC) and Trea­sury.

A to­tal of 60 ex­perts from lo­cal in­sur­ance com­pa­nies and abroad at­tended the two day meet­ing.

IPEC deputy chair­man Mr Ge­orge Mazhude said they were in the process of craft­ing a law that will com­pel all ser­vice providers to abide by set stan­dards.

Mr Victor Mu k o t e k w a of Afri-Sure Con­sul­tancy said plans w e r e un­der­way to em­bark on coun­try­wide awa r e n e s s c amp a i g n s to en­cour­age peo­ple to in­sure their prop­erty.

Dr Ju­dith Ka­teera

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