According to the Insurance Regulatory Authority of Uganda (IRA), the system, dubbed Bancassurance, recorded a 54 percent growth dominated in the second quarter (April to June 2021), from the previous three months ended March.
More Ugandans have embraced the insurance platform where one can
carry out insurance transactions through a bank branch of their choice.
According to the Insurance Regulatory Authority of Uganda (IRA),
the system, dubbed Bancassurance, recorded a 54 percent growth dominated in the
second quarter (April to June 2021), from the previous three months that ended in
Bancassurance was introduced in Uganda by the Financial Institutions (Amendment)
Act 2016 alongside Islamic Banking and Agent Banking, to increase access to
insurance services for Ugandans. However, its full-year of
implementation was 2018/2019, allowing the customer to buy insurance products
through any bank licensed by the IRA.
According to IRA, the insurance industry generally registered good
growth in the first six months of 2021 on account of improved product uptake
and interest, generating a total of 600 billion shillings in gross
In the quarterly performance, bancassurance accounted for 8.2 percent of the
industry’s total business for the first six months of 2021, up from the 5
percent for the same period in the previous year. Four banks; Stanbic, Absa,
Centenary and post bank lead the share of the business, accounting for a
In 2020, the bancassurance sector produced 32 billion shillings
for the whole year, compared to 49.3 billion in the first half of 2021 which is
54.24 percent higher % growth, according to the industry report published by
Stanbic Bank also dominated the bancassurance business for
Non-life (General insurance) product- lines generating 3.5 Billion Shillings which
is equivalent to 28% of total industry volumes.
Singh Dogo, the Stanbic Bank Uganda’s Head of Bancassurance said that the
bank’s good performance in the second quarter was driven by growth in general
insurance and credit life business as well as short-term insurance covers for
“These are stable, and we project that they will continue to grow
on account of their unique positioning to address customer coverage needs
coupled with our assured fast claims service,” Dogo said.
Currently, 20 commercial banks out of 25 are carrying out
The banks reported most business activity from fire and motor
insurance, which attracted premiums worth 926 million and 748 million shillings
respectively over the second quarter, out of a total of 1.89 billion shillings
for Non-life insurance.
The banks also registered claims totalling 3.5 billion across all
insurance segments, with most of them coming from the motor and fire policies.
According to the banks, there is still a lot of ignorance among
Ugandans about Bancassurance and many of them walk out of their banking halls
to look for insurance agents, leaving the services nearby.
They also assure the public that the services are as safe and
secure as at insurance companies because of the agreements they sign with the
“Customers should enjoy purchasing Insurance through Banks given
that Banks sign Service Level agreements that ensure a given standard of
service is offered with constant monitoring to avoid declines,” says Stanbic’s
Orient Bank Principal Officer, Bancassurance, Christopher Sengendo,
says the customers have an added advantage going to banks because there are also
insurance credit services.
This helps especially since the industry started the “Cash and
Carry” system a year ago, where policies have to be paid for upfront before
there are acquired.
“In some instances, customers can be low on cash to pay for their
Insurance. This is when one can go for Insurance Premium Financing which are
short term loans offered to customers to pay their Insurance premium,” he says.