Insurance competition remains minimal despite 30% growth
Posted Monday, April 21 2014 at 01:00
Despite the insurance industry growing by 30.08 per cent last year, competition among industry players remains minimal, with huge disparities visible in terms of written premiums.
Statistics from the Insurance Regulatory Authority (IRA) indicate that more than 60 per cent of the non-life insurance market – the biggest sub-section in Uganda’s insurance industry – is still controlled by only three players; Jubilee, UAP and AIG.
Despite being highly concentrated, with 20 insurance companies, Jubilee Insurance, which accounts for 23.75 per cent of the total market, underwrote (realised) Shs83.4 billion out of the industry’s gross written premiums of Shs456.86 billion.
That was followed by UAP whose gross written premiums were reported at Shs56.9 billion, accounting for 16.21 per cent of the market.
AIG, which commands 14.27 per cent of the market, underwrote Shs50.1 billion last year. Goldstar Insurance, which is the fourth biggest player in Uganda’s insurance industry, accounting for 6.09 of the market, underwrote Shs21.4 billion while Lion Assurance underwrote Shs19.1 billion and accounts for 5.4 per cent of the market.
The status quo of the big tigers has remained unchanged ever since Uganda’s insurance industry space was liberalised over 15 years ago.
The improved industry performance was attributed to a gradual shift in public perception about the value of insurance, arising from increased public awareness, product innovation, broadening and deepening of distribution channels and streamlined claims settlement processes among others. Industry gross premium written rose by 30.08% to Shs456.86 billion in 2013 from Shs351.23 billion in 2012.
Claims settled increased to Shs90.7 billion, from Shs77.89 billion in 2012.