Government says it is worried that despite increasing financial literacy, insurance penetration in Zambia has remained low.
According to the Finscope survey, Zambia saw financial literacy rates rise from 37.3% in 2009 to 69.4% in 2020.
Finance Minister Situmbeko Musokotwane observed that Zambia has some of the lowest insurance penetration levels in the world with many of its citizens uninsured.
Dr Musokotwane said there is need for more sensitization to get many Zambians insured.
And Dr. Musokotwane said recent positive trajectory in the macro-economic environment has induced high levels of investor confidence in the Zambian economy.
He said a stable macroeconomic environment is one of the critical ingredients for achieving sustainable economic growth and, ultimately, poverty reduction.
Dr. Musokotwane was speaking in Lusaka Wednesday morning in a speech read on his behalf by Permanent Secretary for Economic Management and Finance Dainess Chisenda during the launch of BestLife Insurance Limited, a new wholly owned Zambian life insurance company.
He said government is happy that the Pensions and Insurance industry has remained stable over the years due to the efficient supervision and is registering growth with the coming in of new players such as BestLife Insurance.
“My Ministry is happy to know that the pensions and insurance industry remained stable over the years due to efficient supervision of the regular, the Pensions and Insurance Authority (PIA). As the sector grows with the coming in of new players such as BestLife, It is my hope that the pensions and insurance’scontribution to the economy will also continue to increase and inspire public confidence,” Dr Musokotwane said
“The Insurance Industry has remained resilient recording a growth of 16.97 percent in terms of Gross Written Premium (GWP) during the year ended 31st December 2021 (2020: 27.75 percent). In quantum, GWP increased to K5, 343 million from K4, 568 million in 2020.”
He added, “The insurance industry growth rate was attributed to increased fire, life and health insurance uptake, following the expansion of the construction industry and increased uptake of insurance services following the COVID-19 pandemic. The growth in fire, life and health insurance uptake signifies a growth in non-motor products which has dominated the industry for a number of years. This is a good indication of the expansion of products offered in the Insurance Industry.”
And BestLife Zambia Board Chairman Geoffrey Sakulanda said the new company is targeting to become a key player in the life insurance space by 2030 by offering superior and tailor made services for all segments of its customer base including ordinary Zambians.
“The birth of BestLife Insurance speaks to the renewed confidence in the Zambian economy as a key destination for private sector investment, both local and foreign under the stewardship of His Excellency President Hakainde Hichilema. We are launching BestLife at a time when there is growing interest in Zambia and we believe our timing could not have been any better,” he said.
“As BestLife, we aim to becoming a key player in the life insurance space by 2030 by offering superior and tailor made services for all segments of our customer base including ordinary Zambians. Our pledge is that we will always be innovative, always looking for ways to meet Zambian’s evolving needs and change lives for the better. Everything we will do from today is geared towards making it simpler for you to make best life choices and to protect and grow your wealth.”
And Chief Executive Officer Christabel Michel said BestLife is geared to transform the life insurance sector in Zambia.
“At BestLife, we believe there are a lot of people that need life insurance, but they do not have life insurance, because they do not really understand it. The challenge with insurance in Zambia is that it is still viewed as elitist and not for everyone, that it is basically for the wealthy. As BestLife Insurance, we believe that everybody should get covered and this is what makes us truly unique,” Ms. Michel said.
“We will work actively with the Insurers Association of Zambia on its consumer education programmes in order to contribute to efforts to increase knowledge levels about insurance. Zambia has one of the lowest insurance penetration globally, meaning the country still has tremendous potential for growth and this offers a great opportunity for BestLife to showcase its innovative approach to insurance.”
Meanwhile, Registrar at Pensions and Insurance Authority Mrs. Namakau Ntini urged insurance companies to quickly settle claims when they fall die in order to restore public confidence in the sector.
“The speed at which onboard of new customers happen should be the same speed at which claim settlement happens,” Mrs Ntini said.