Medical cover overtakes motor insurance as most written policy
There was an improvement in medical insurance uptake due to health risks worsened by Covid-19. PHOTO | FILE
Medical insurance was the most written non-life policy in the second quarter of 2021, according to data from Insurance Regulatory Authority (IRA).
During the period, IRA data indicates, medical overtook motor insurance, signaling a shift in policy underwriting due to health risks that have become more apparent in the last two years as a result of Covid-19.
According to IRA data, medical policies worth Shs78.9b were written, representing a 6 per cent increase from the Shs73.4b that was recorded in the same period in the previous year.
The growth was against a reduction in motor vehicle insurance, which registered an 11 per cent decline with gross non-life premiums falling from Shs88.1b in the same period in 2020 to Shs78.7b.
Mr Protazio Sande, the IRA director planning, research and market development manager at the weekend, told Daily Monitor the growth in medical insurance could have been a result of a shift in people’s perception with the need to improve risk management becoming more heightened.
“We think this is going to increase the demand for insurance as an alternative risk management mechanism,” he said, noting that the scare associated with recent events surrounding Covid 19, has seen people appreciate the need to takeout insurance.
“Covid 19 has increased adoption of technology-based insurance. This has eased access and will in the long-term reduce the cost of doing business,” he said.
During the period, according to IRA, fire was the third largest written policy, grossing Shs72b up from Shs59b in the same period last year.
Under fire, Jubilee, UAP General and Sanlam wrote the most policies, grossing Shs24b, Shs13.4b and Shs10b in premiums , respectively.
Marine aviation, data indicates, registered a jump in written premiums, grossing Shs31b during the period compared to Shs23.3b in the same period last year.
Burglary, personal accident, bonds, engineering and workman compensation, among others, were the other policies that recorded attractive premiums during the period.
According to IRA non-life insurance registered a 12.6 per cent general increase with gross premium growing to Shs390b up from Shs347b in the same period last year.
At the weekend Mr Christopher Ssengendo, the Uganda Bankers Association Bancassurance committee chairman, said Covid-19 had forced a number of Ugandans to appreciate the need for medical insurance, noting that whereas it has ravaged lives, it has been an eye opener that should be taken advantage of.
The insurance sector has also in the last five year engaged a number of innovations, many of which are helping to uplift a sector, whose penetration has over the years stagnated at under 1 per cent.
For instance, Bancassurance, which in the period under review contributed about 8.3 per cent of the Shs600b gross written premiums, has been a game changer, which experts say is expected to greatly improve insurance penetration in the next five years.
