Global insurer, Prudential, has become the country’s largest life insurer following the acquisition of IAA Air Ambulance Healthcare, a Health Membership Organisation, at undisclosed consideration.
Kampala, Uganda | ISAAC KHISA | Prudential Life Assurance Uganda Ltd entered the Ugandan market in 2015 through the acquisition of Goldstar Life Assurance, and has since recorded faster growth in market share and gross underwritten premiums.
It has seen its market share surge from merely 1.6% in 2016 to 13% in 2019, according to the industry regulator, Insurance Regulatory Authority of Uganda data, with gross underwritten premiums increasing from Shs2.2bn to Shs36bn during the same period under review.
The acquisition of IAA, the market leader in the HMO’s business segment, with a gross underwritten premiums of Shs 32bn in 2019 now places Prudential Assurance at the top of the country’s nine life insurers, with a combined gross underwritten premium of more than Shs68bn.
UAP Life Assurance has been the market leader in the life insurance business with Shs53.4bn in gross underwritten premiums and a 19.3% market share.
Arjun Mallik, the regional chief executive officer of Prudential Eastern and Central Africa said during the transfer of policy holders, staff and agents of International Air Ambulance Healthcare to its business on July 14 that the new development is a major milestone to their business in Uganda and that it demonstrates their commitment to rapidly expand in Africa as part of Prudential’s growth strategy.
“At Prudential, our purpose is to help people get the most out of life. We want to assure our new and existing customers that we are committed to continuously provide them with quality and affordable health insurance, delivered with the highest level of service,” he said.
Sukhmeet Sandhu, CEO of International Medical Group, the parent company of IAA said their future strategic objective is to focus on their core business–healthcare, and in line with their vision of providing quality and affordable healthcare service of international standards in Uganda.
“IAA has been a commercially gainful business over the years therefore, we sought out to find a suitable partner to take over our insurance book enabling us to strengthen our focus on healthcare,” he said.
Sandhu said IMC, which currently owns and operates International Hospital Kampala, plans to open four new medical centres, increasing the number of treatment centres countrywide to 25.
“We are (also) upgrading three of our centers in Mbale, Gulu and Mukono to hospital status to handle inpatient and specialist services,” he said.
Penetration remains low
This comes at the time insurance penetration in Uganda remains below the 1% compared to Kenya’s 2.83%, Lesotho 4.7% and South Africa’s 16.9%.
Ibrahim Kaddunabbi Lubega, the chief executive at IRA said mergers and acquisitions breed healthy competition and bring about customer-centric innovations and improved service delivery which in turn results in greater insurance penetration and more people being protected.
“…as such, I would like to take this opportunity to encourage the adoption of digitally led insurance services delivery in Uganda, cultivate a hunger for continued innovation in products so as to set industry trends locally and in the region,” he said.
IAA Healthcare was started 2001 and has since established itself as the leading HMO in the country that provides the most comprehensive Health Insurance Plans to its customers. The HMO had over 500 corporate clients with a total of over 60,000 lives insured.
On the other hand, Prudential is a wholly owned subsidiary of Prudential Asia, one of the largest life insurance companies in the world with over 100 years of experience, serving more than 20 million customers word wide in the United States of America, Asia and Africa.
Listed on the stock exchanges in London, Hong Kong, Singapore and New York, Prudential has insurance operates in eight countries in Africa: Cameroon, Cote d’Ivoire, Ghana, Kenya, Togo Uganda, Zambia and Nigeria.