Explain insurance policy to the public

Tuesday February 25 2020


By Editorial

The revelation by this newspaper yesterday that the Insurance Regulatory Authority (IRA) has proposed compulsory insurance scheme for schools and boda bodas is not shocking; but it instead triggers a bigger concern.
Over the past years, we have had several cases of school fires where students’ property get destroyed and in some instances, lives are lost.
In the same way, there are numerous boda boda accidents on our roads. For instance, according to the Department of Traffic Police, at least 7,000 people were killed in boda boda accidents between 2015 and 2017, across the country.
When the locusts invaded north east and eastern Uganda two weeks ago, there were calls by sections of the public to embrace agricultural insurance schemes to safeguard farmers against eventualities.
The health insurance has been a subject of debate over the past one year after government showed interest in managing the sector, or the pros and cons of paying for the service even with private firms. Well, we cannot exhaustively discuss the insurance business here. But we would like to offer a few insights.
While Mr Protazia Sande, the director of Planning, Research and Marketing Planning at IRA means well, we need to address the issue of insurance altogether. Why aren’t many people embracing it?
According to a March 2017 report, ‘Funding the Frontier: The link between inclusive insurance market, growth and poverty reduction in Africa’, insurance penetration in the sub-Saharan Africa was the lowest in the continent. In particular, Uganda’s insurance penetration was at 0.81 per cent in comparison to average of 2.96 per cent in the continent.
Experts have written in this newspaper before that there is a general apprehensive attitude towards insurance among many Ugandans. And one of the reasons for this is that the public is not well informed about how insurance works.
Also, technical jargon, terms and conditions and associated details, not known to the regular client, coupled with lack of deliberate explanations to consumers as to how these apply to their policy contracts is a recipe for contentions, especially at the time when consumers report claims.
As such, many consumers do not know the services available to them in packages and are even ignorant of the laws governing insurance. The ‘terms and conditions’ remains an arbitrary phrase because many packages do not show the full exposure of implied conditions binding the insurer and the insured.
The IRA would do a fair service by encouraging all to study the Insurance Act, 2017, among other laws. Information is power and avoids all doubt.

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