Kampala, Uganda | THE INDEPENDENT | More Ugandans are likely to take on insurance cover as more insurance firms partner with commercial banks to come up with the products. This, according to Gary Corbit, the CEO of Sanlam General Insurance, is due to the fact the trust people have in the banks.
“Think about it. I have been a customer of the bank for 20 years. Why, because I trust these people,” Corbit said on the sidelines of the launch of a partnership with Standard Chartered Bank where they will offer various bancassurance products.
He added that the difference between insurance and bancassurance is because of the bank. “People trust banks,” he said.
Bancassurance means the selling of life assurance and other insurance products and services by banking institutions. It was passed in the amendment of the Financial Institutions Act in 2017 together with the agent banking.
Insurance coverage in Uganda is extremely low – at less than 1 per cent of the population. This is partly because people don’t trust the industry in that if I get a cover and get a problem they will be able to pay my claim or not.
Another issue is that people simply don’t understand the significance of insurance. Also, the level of income matters. As many people’s disposable income grows, they have more to spare on issues like insurance.
Corbit said the issue of trust has improved compared to what it was in the 1990s. On claims payments, he said his company pays claims in hours after it has been lodged, but that is still not good enough.
“It should be immediate. It shouldn’t be hours. That is what we are going to,” he said
On partnering with banks, it means they can now sell insurance products as part of what they offer. Here, they can capitalize on their customers to offer these policies. Banks are also aware of which kind of a customer is likely to pay or not.
Albert Saltson, CEO Standard Chartered Bank, said the insurance products launched will take care of our client’s protection needs, and suit their needs.
The products include home/private property insurance, travel insurance, and motor comprehensive.
On home insurance, Saltson said an individual or their family member can be offered cover of up to Shs 8m. It comes with a member benefit of up 2 million Shillings. The travel insurance can cover up to USD 500,000 of the liability.
Saltson wouldn’t say how much one would pay to get these covers. They said it would depend on individual characteristics and the amount of risk they carry.