Uganda’s insurance sector has grown to shs973.58 billion in the year 2019 from shs859.8 billion in 2018, the regulator, Insurance Regulatory Authority has said.
Speaking during the release of the country’s insurance sector performance report for the year 2019, IRA Chief Executive Officer, Ibrahim Kaddunabbi Lubega said this represented a growth in the uptake of insurance products by 13.22% which meant maintenance of a two-digit growth trajectory.
“In the year 2019, insurance penetration reduced from 0.844% in 2018 to 0.77% in 2019. The decline is as a result of rebasing of the 2018/19 GDP figures that saw the size of the economy (GDP) expand from shs109.9trillion to shs122.7trillion (11.65percentage growth),”Kaddunabbi said.
He said that non-life business generated shs621.68billion in premiums, from shs 572.79billion in 2018 representing an 8.54% growth whereas life premiums grew by 26.77% from shs 217.97 billion in 2018 to shs276.32 billion in 2019.
Premiums in the health maintenance organization sector grew by 8.9% to shs75.26 billion from shs69.11 billion in 2018.
“The positive growth continued to emerge from strong economic fundamentals like inflation which remained below 5% resulting into strong growth in the year 2019,” the Insurance Regulatory Authority CEO explained.
“There was also enhanced distribution with premiums collected through bancassurance going up, sustained growth in uptake of medical insurance class of business mainly by corporate organisations.”
Kaddunabbi said that whereas premiums from Bancassurance channels raised shs53.6 billion from shs26 billion in 2018, premiums from medical insurance increased from shs204 billion in 2018 to shs219 billion in 2019.
According to the sector performance report premiums from agriculture insurance also continued to grow from shs5.25 billion in 2018 to shs12.7 billion and contributed to the overall sector growth.
“The uptake of agriculture insurance from the consortium increased by over 30,000 farmers from 50,000 farmers in 2018 to 82,000 farmers in 2019,”Ibrahim Lubega Kaddunabbi, the Insurance Regulatory Authority, Chief Executive Officer noted.
He added that a growing middle class and enhanced insurance customer confidence in the sector also contributed to the growth in the sector’s premiums.
The insurance sector’s assets increased by 11.23% from Shs508b in 2018 to shs565.2 billion in 2019.
The report says that the sustained growth in net assets indicates improvement in capacity for the industry to absorb more risks locally and also provide adequate protection to the insurance public.