IRA eyes full implementation of sectoral regulations as part of 2023 priorities
watchdoguganda.com, January 18, 2023, 07:57AM | The Insurance Regulatory Authority (IRA) of Uganda, which is the state’s insurance controller has put implementing sectoral regulations at the forefront of its priorities for 2023.
This was revealed by the Chief Executive Director (CEO) of the regulatory body, Mr. Ibrahim Lubega Kaddunabbi , while speaking recently at a CEO breakfast meeting held in Kampala.
Mr. Kaddunabbi said their areas of concentration in 2023 will be full implementation of current sectoral regulations and finalizing the ones that are pending.
He also revealed that a lot of efforts will be put on finalising the Motor Vehicle Insurance Bill which seeks the amendment of Section 39 of the Motor Vehicle Insurance Act Cap 214.
Other areas of concentration include the implementation of International Financial Reporting Standard 17, automating the authority’s supervisory operations by acquiring and deploying of the supervisory and reporting software.
Major focus will also be put on the implementation of the compulsory marine cargo insurance and continuation with the implementation of Risk Based supervision on top of Monitoring Capital Adequacy Ratio (CAR) of insurance companies.
“Our core mandate remains policy holder protection and ensuring that legitimate claims are paid in time,” remarked Kaddunabbi.
Note has to be taken that Insurance penetration in Uganda has for years remained at an all time low, below 1%, a factor that has been attributed in part to the public perception that insurance players do not easily pay or compensate policy holders when losses are incurred.
Worse still, the skyrocketing basic commodity product prices have hiked the costs of living for households and therefore buying insurance is not a key priority area, given the fragile sources of income, which are not adjustable to the high costs of daily life.
Experts in the insurance sector have supplied a grim connection to low penetration insurance levels with the low awareness strategies which has kept a significant number of the citizenry largely uninformed about the impressive opportunities that insurance has to offer.
In this regard therefore, the roadmap for IRA this year also includes heightened awareness campaigns to see to it that the public is supplied with sufficient information about opportunities that the sector offers to increase penetration levels.
Basing on the information from the IRA website, Uganda is confirmed to have 31 insurance companies, two re-insurers, 28 loss assessors, three HMOs, 20 bancassurance agents, three re-insurance brokers and 48 insurance brokers.
Recent statistics from the regulatory body also indicate that the sector recorded sustainable growth in the third quarter of 2022, with the total gross written premium growing from UGX. 912 billion in quarter three of 2021 to UGX. 1.08 trillion in quarter three of 2022, accounting for 18.57% in the same period.
Nevertheless, gross claims paid amounted to UGX. 476.52 billion during the period, accounting for 44.1% of the industry’s total premium compared to UGX. 363.15 billion which was paid in quarter three of 2021.
Premiums accounted for 32.5% of the aggregate sector written premiums in the report period as compared to non-life assurance which accounted for 58.5% of the aggregate industry written.
Also vital to point out, the combination of the remainder classes, which included HMOs, Dedicated Health Insurer and Micro insurers accounted for 9% of the aggregate premiums subscribed.
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