The Insurance Regulatory Authority of Uganda (IRA)
Tel: 0312-266364/ 0414-346712 | Fax: +256 414 349260
Email: ira@ira.go.ug | Web: www.ira.go.ug
Location: Plot5, Kyadondo Road, Nakasero. Legacy Towers, Block B, 2nd Floor, Kampala 22855, Uganda  Chief executive officer, Mr Ibrahim Kaddunabbi IRA: Insurance Authority to return security deposits Insurance Regulatory Authority (IRA) has issued an ultimatum to insurance companies and brokers that ceased operations to apply for withdrawal of their security deposits or risk losing their money. 36 firms will benefit from this gesture.“We gave them a deadline that if they do not pick that money, they cannot come out and claim for that money,” communications officer IRA Ms Mariam Nalunkuuma said in an interview on .This follows a statement issued by chief executive officer, Mr Ibrahim Kaddunabbi that read, in part, “The authority informs the unlicensed insurance players who have ceased operations and have not yet applied for the withdrawal of their security deposits to submit the information here below.” Read more ▪ IRA: Shs200b paid out to insurance claimants A total of Shs200 billion was spent on clearing insurance claimants in the last fiscal year, Insurance Regulatory Authority (IRA) has revealed.Mr Protazio Sande, the IRA assistant director marketing and development, said insurance companies in totality collected more than Shs600 billion but spent Shs200b remedies for clients.Basing on these figures, Mr Sande dismissed what he termed as mere talks that insurance companies do not compensate their clients when disasters arise.“I know the insurance industry is not 100 per cent perfect. But I don’t believe insurers do not clear covers. If that was the case, how come our statistics show Shs200b was used to sort out damages incurred by clients?” Mr Sande asked.He made the remarks at the annual insurers’ sports gala at Gems Cambridge International in Mutungo, Nakawa Divison, in Kampala. Read more ▪ IRA: Insurance firms warned against high costs Insurance Regulatory Authority (IRA) chief executive officer has cautioned insurance providers against high costs of management which he said affect their ability to meet their claims."Health Maintenance Organisations (HMOs) are being regulated for the first time and we have discovered that many of them were having high management expenses," said Mr Ibrahim Kaddunabbi Lubega.He was speaking to human resource managers during a breakfast meeting hosted by IAA Health Insurance in Kampala.Mr Lubega said the insurance fraternity has guiding expenses and as such where they see management costs going above 20 per cent of the premiums collected, they get concerned."If the management expenses exceed 30 per cent, then it becomes unbearable because the recommended rate is below 20 per cent of the premiums," he said. Read more ▪ IRA: Insurance industry records 22% growth Uganda’s insurance industry has grown by 21.58 per cent according to the Insurance Regulatory Authority (IRA).The growth from 9 per cent to 21.58 per cent is attributed to uptake of large infrastructural projects and the private sector.“The gross premium underwritten by the insurance industry has increased in the financial year by 21.58 per cent which is composite growth. Infrastructure is one of the factors that triggered its growth,” Mr Ibrahim Kaddunabbi Lubega, the chief executive officer Insurance Regulatory Authority (IRA), said.He added that one of the factors was the uptake of local insurance by large infrastructural projects such as Isimba hydropower project, Entebbe airport, Nile Bridge in Jinja, Kampala-Entebbe Expressway and various small dam projects.The budget for the transport and works sector was more than doubled to Shs3.3, with an additional Shs753.3 billion being allocated to the sector. Read more ▪ IRA: Insurance body targets 5,000 agents to boost penetration The insurance industry is targeting to license 5,000 more agents in a bid to increase popularity of products in both life and non-life segments. Insurance Regulatory Authority (IRA) chief executive officer Kadunabbi Lubega said efforts are being directed towards increasing insurance penetration through enhanced access and awareness.According to IRA, insurance penetration in Uganda is still low at 0.86 per cent of the GDP. Speaking during the opening of ICEA Life Assurance Company Agency office in Kampala last week, Mr Lubega said there were 1,400 licensed insurance agents, up from only 650 agents. He said he hoped to raise this number by about 5,000 more agents. “As industry players, we have to be able to make insurance services readily available to all Ugandans and the industry has to be proactive in the way it carries out its operations,” he said. Read more ▪  IRA: Liberty acquires majority stake in Madhvani’s firm The Madhvanis have sold a 51 per cent stake in the non-life insurance business, East African Underwriters Limited (EAUL) to Liberty Holdings Limited of South Africa. The cost of the transaction was, however, not disclosed after the deal was signed. EAUL, which holds a 2.7 per cent market share in the non-life insurance segment in Uganda, holds insurance premiums of Shs10.6b according to the Insurance Regulatory Authority (IRA). “We believe that this new partnership in the short-term industry will enrich our investment and development efforts by broadening the skills base and bringing new technical expertise to the market,” said Mr Kamlesh Madhvani, the director Madhvani Group.On the other hand, Liberty will have access to the non-life insurance segment in Uganda, which it initially was never part of in the country. Read more ▪ UIRA: Scrap medical assessment fees, Insurance Regulatory Authority tells government The executive director Uganda Insurance Regulatory Authority (IRA) has asked government to scrap off the police medical assessment fees in order to ease claim settlements.Mr Ibrahim Kadunabbi Lubega said many Ugandans, especially low income earners, find it hard or even impossible to pay Shs70,000 to get the medical report, a prerequisite that insurers use to settle claims.“The medical assessment report fees should be scrapped off or made cheap to enable people get their claims,” Mr Kadunabbi said at IRA offices in Kampala.He was responding to complaints mainly from bodaboda cyclists who said they hardly claim anything despite paying for Motor Third Party Insurance (MTP) which is provided for in the Third Party Risks Act. Read more ▪ IRA: Insurance players agree on regional supervision The East African Insurance Supervisors Association has agreed to develop a regional framework that will supervise activities of insurance companies with operations across the region through countries’ Insurance Regulatory Authorities. The framework is in line with other regional decisions aimed at East African integration and like other sectors; East African governments are amending or coming up with Bills that fit in those laws available other countries.“We have a Common Market and other things, so as insurance supervisors, we have to ensure that there is something that can cover insurance companies which operate in more than one country,” Mr Ibrahim Kaddunabbi Lubega, the chief executive officer, Uganda Insurance Regulatory Authority said during regional insurance players meeting. Read more ▪ IRA: Insurance Authority Licenses 88 Firms The Insurance Regulatory Authority of Uganda (IRA) has licensed 88 firms that will transact insurance business this year, with seven new companies entering the market.At least 21 firms have received licences for non-life insurance businesses while eight for life insurance and one reinsurance company. The authority also licensed 12 health membership organizations, 27 insurance brokerage firms and 18 loss assessors.The sector continues to grow, albeit slowly. The entry of new players might attract more and fuel competition in the market. Some of the new entrants are: Alliance Africa General Insurance Limited, CIC General Insurance Company, CIC Africa Life Assurance Limited, Assured Partners Insurance Brokers Limited, Interlink Insurance Africa, Milvik Uganda Limited and Claim Care Uganda Limited.Insurance penetration in Uganda remains dismally low at less than one per cent. The authority is looking at bringing in more players. Read more ▪ IRA: Insurance regulator proposes new guidelines for companies The Insurance Regulatory Authority (IRA) has proposed new guidelines for insurance companies that are looking to offer health services in the country.Key among the proposals, if agreed upon, will require Health Maintenance Organisations to have a capital investment of Shs500 million and 30 per cent of the working capital.The Micro-insurance segment will be required to have Shs100 million and Shs4 billion for non-life insurance companies before being registered by IRA.The regulator also proposes that all health insurance staff be required to have requisite qualifications and experience in offering health services to their clients.Speaking at a consultative workshop for the draft of micro-insurance regulations, health insurance and membership organisations, IRA chief executive officer Ibrahim Kaddunabi Lubega said the proposed regulations will help streamline health insurance in the country.Read more ▪ IRA: Insurance industry looks to informal sector for growth With progress in the insurance industry as demonstrated by the 31 per cent growth registered in the previous year, the industry regulator has said its problem has since shifted from stimulating the growth to sustaining it. The latest Insurance market report indicates that the previous year gross insurance premium written rose to Shs463 billion from Shs351 billion, representing a remarkable 31 per cent growth in the industry.“Realising 31 per cent growth in gross written premium is not a mean achievement. However, sustaining it over years is even harder,” Mr Gaudioso Kabondo Tindamanyire, the board chairman of Insurance Regulatory Authority of Uganda, said in the report.In an interview with the industry players, it emerged the sustainability that the regulator is talking about can be triggered by innovations that target people in the informal sector, a substantial number of whom are low income earner.Read more ▪ IRA: Insurance competition remains minimal despite 30% growth 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. Read more ▪ The insurance sector is adapting to the needs of the average Ugandan by introducing low cost micro-insurance policies, cutting red tape on compensations and opening a complaints bureau for aggrieved clients. Kaddunabi Lubega, the Insurance Regulatory Authority (IRA) executive director, notes that collaborations with other sectors, especially, with the information and communications technology sector, will bridge the gap between the sector and the public. Edith Kutesa, the M-Cash chief, said collaboration between Liberty Life Assurance and M-Cash has benefited from the use of biometric technology to verify the identity of clients to cut fraud. Read more  ▪ More insurance mergers expected as separation of business deadline nears As the deadline for the separation of general and life insurance business nears, more mergers and acquisitions have been predicted as companies that are unable to run them as separate business, opt to let them go.Speaking on the sidelines of an SSP (insurance underwriters’ software) conference in Kampala last week, the Lion Assurance managing director, Mr Newton Jazire, said although some companies with composite insurers have started separating the businesses, small ones that are unable to run them as separate entities will have no choice but to merge or be acquired.“There is no point for a company to struggle to raise the required Shs4 billion minimum capital to underwrite Shs500 million,” he said.The Insurance Regulatory Authority (IRA) requires all insurance companies that offer both life and non-life insurance as a composite business to separate and run them as independent entities by October 1, 2014. Read more ▪ Mergers, acquisitions take shape in insurance Just as predicted by market analysts, Uganda’s insurance sector appears set for consolidation as the market begins to witness mergers and acquisitions.The latest is Sanlam Emerging Markets (pty) Limited’s acquisition of 50.3 per cent stake in Niko Insurance Uganda.The move follows the sale of 49 per cent stake of Niko Group’s General Insurance Business in Uganda, Malawi, Tanzania and Zambia to Sanlam Emerging Markets (pty) Limited, a subsidiary of South African based Sanlam Group, according to a press statement issued on Tuesday.The transaction also saw Sanlam acquire 51 per cent stake in Niko General Insurance Company Malawi, 51 per cent shareholding in Niko Insurance Zambia and 34 per cent stake in Niko Insurance Tanzania at an undisclosed amount.Analysts including African Alliance chief executive officer Kenneth Kitariko and insurance company chiefs predicted last year that Uganda’s financial services industry that includes banks and insurance companies would witness mergers and acquisitions due to changing regulatory frameworks and requirements. Read more ▪ Innovation Spurs Insurance Industry Worried about identity theft? You are not alone. Identity theft means that someone has stolen your personal information for the purposes of conducting transactions without your knowledge, and therefore purporting to be you. Identity theft is a fast-growing crime that can take a heavy financial and personal toll. Among other things, it can cost a good deal of time and money to restore your credit and your reputation. The inevitability of having to embrace the digital age means that even in Uganda, electronic financial transactions will soon become part of everyday life, and thus expose your personal information to potential abuse. Risk mitigation parameters exist for your protection in the form of Identity Theft Insurance. Read more ▪   Board for insurance institute unveiled A board of trustees was unveiled to fast-track the establishment of the Insurance Institute of Uganda (IIU). The board will largely be responsible for the management of funds accruing from the newly introduced training levy - a contribution by individual insurance companies to facilitate the running of the institute. The IIU chief executive, Mr Geoffrey Kihuguru (left), said the constitution of the board serves as one of the key drivers that will bolster the fast-tracking of the sector’s human resource. Mr Ibrahim Kaddunabbi, the Insurance Regulatory Authority chief executive officer, said the authority was in the process of developing regulations that would assist the formation and regulation of the institute. Read more ▪ | |