IRA sends out new insurance business guidelines in the wake of Covid-19 

While the country continues to observe Presidential directives as guided by the Ministry of Health which among others include a countrywide lockdown with selected essential services being provided, the Insurance Regulatory Authority of Uganda (IRA) has realized the impact which the Corona Virus Disease (COVID-19) has had and will have on the economy, both locally and internationally. 

Following this COVID-19 challenge and not being sure when it will come to an end before normalcy sets in, the Authority has found it prudent as guided by section 12 (1) (b) of the Insurance Act 2017 to come up with industry guidelines on the conduct of business during this period when the COVID -19 pandemic is hitting hard. 

Some of these guidelines among others include; the need for licensed insurance companies to consider not terminating insurance contracts due to non-payment of premium during the COVID-19 pandemic period, exempting policy holders from late payment penalties on overdue premium payments, extend claim notification period by policyholders for a period of not less than 30 days and waive any cost sharing (co-payments) related to testing and treatment of COVID -19 cases. 

According to IRA management, these guidelines are aimed at providing relief to affected policyholders by allowing continued insurance coverage leave alone ensuring that all insurance customers are treated with utmost fairness. 

The new guidelines also require insurers to take necessary measures that preserve their business capital position during this COVID-19 pandemic period. In this regard, IRA has guided that save for Deposit Administration Plans and for profit policies, no insurer or Health Membership Organization (HMO) shall issue bonuses or engage in any distribution including payment of dividends to shareholders or other persons unless permitted by the authority. 

Besides that, insurance companies and HMOS are required to conduct a review of liability profile, asset backing policy liabilities and investment decisions. They will also perform liquidity analysis on a monthly basis to ensure that the analysis guides them to put in place measures which will see business operations continue. This is aimed at enhancing operational resilience within the insurance industry. 

IRA insists that during this period, Insurers should exercise utmost faith and flexibility in accepting proof of claims, offer due consideration in determining claims and give due regard to the claims settlement guidelines and therefore settle claims as soon as possible. This is based on the fact that the lockdown comes with restricted movements. 

Matters of health have equally put into consideration and to this effect, all insurers and HMOs have been tasked to implement Ministry of Heath safety measures as their office premises such as observing social distance, establishment of hand washing points having soap and an alcohol based sanitize. 

“Due to the evolving nature of the COVID-19 outbreak, these guidelines are bound to change and the Authority will inform the industry should such changes become necessary”, read part of the directives to all insurers and HOMs.