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Eight banks cleared by IRA to sell insurance policies

Kaddunabbi (R) and Ssekabembe (middle) addressing a press conference at IRA offices in Kampala on Feb.08. Photo by Julius Businge.

Kampala, Uganda | JULIUS BUSINGE | The Insurance Regulatory Authority (IRA) has so far issued eight certificates to banks to offer bancassurance (selling insurance policies) to their clients as one way of boosting the sector’s growth.

Speaking at a press conference in Kampala on Feb.08, IRA officials including the Chief Executive Officer, Ibrahim Lubega Kaddunabbi said their doors are open to all the 25 banks to express interest to grab an opportunity to trade insurance policies.

At the presser, DFCU bank officially received an official certificate from IRA to start selling insurance products at its 67 branches across the country. The bank is partnering with Sanlaam, Britam and Prudential insurance companies in this trade.

William Sekabembe, DFCU’s executive director, said the development comes at a time when the financial sector in Uganda is growing and that this would give it another boost.

He said that the bank’s shareholders would benefit because it would earn commission on policies that it would sell. The policies available include; motor vehicle cover, fire and burglary, child education, goods in transit and more.

Meanwhile, Kaddunabbi said that involving banks in insurance is coming at a time the public is increasingly demanding for simple insurance products in Uganda but are not served because they are far away from the points of service among other factors.

“We are hopeful this strategy will yield fruits both to banks and the insurance fraternity,” he said.

Analysts say that bancassurance would boost the efforts in place to deepen the sector’s penetration which has been stuck at about 1% for many years, lower than slightly over 2% average rate for the East African region.

Legally, bancassurance in Uganda is backed by the financial institutions amendment act of 2016.

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