Bancassurance is expected to pool more Shs40b by the end of this year, Insurance Regulatory Authority (IRA) has said.
This is nearly double the amount of premiums collected through banks at the end of 2018.
“Last year, over Shs26b in premiums was written through bancassurance. In June this year, the figure was around Shs21b. With exception of two banks that have not submitted information, the premiums grew above Shs30b at the end of September. By close of year, we may have over Shs40b coming in through bancassurance and that is not a small contribution,” Mr Protazio Sande, the IRA director research and market development, said.
The same optimism is spread over the insurance sector on the whole. The sector underwrote Shs867b last year and is targeting the Shs1 trillion mark this year.
“We are going to add on about Shs134b to hit over Shs1 trillion and we are very positive about it. We are in a stable economy, we expect foreign direct investment to flow in,” Mr Benerd Obed, the IRA director supervision, said adding there are numerous opportunities of growth for insurers.
Bancassurance has been a key innovation that is expected to increase insurance premiums and penetration.
Mr Obed also said a number of progress points had been noted with life insurance growing at above 30 per cent per annum while non-life grew at 18 per cent.
“We have oil and gas coming, infrastructural investments, agricultural insurance, standard gauge railway. We are insuring the aeroplanes bought by Uganda Airlines so the future is very bright for us,” he said while handing over a bancassurance licence to Ecobank.
The pan-African bank becomes the 20th commercial bank to attain permission to sell insurance products across its branch network.
According to Ms Annette Kihuguru the Ecobank executive director, insurance products including annuities, funeral covers, education, investment plans and general insurance products are a big part of the bank’s strategy to push products.
Also, she said, a big part of the strategy is to propel growth through digital products and both strategies should enable the bank underwrite premiums worth Shs5b in the first year.