“They do a lot of work transporting passengers, yet they are the least insured! We cannot wish them away because they’re doing a good job,” he said.
The Ministry of Works and Transport has urged government departments to lead the way by insuring their assets, not only to reduce risk but to propel insurance penetration in Uganda.
The minister, Gen Edward Katumba Wamala, says his ministry has most of its assets insured, including all the aircraft under Uganda Airlines, the trains, the water vessels and “the common vehicles on the road.”
He was speaking at the 14th Insurance Agents Awards 2024, organised by the Uganda Insurers Association under the theme, “Driving a Resilient Agency Distribution Channel for Sustained Insurance Growth.”
The government is the biggest owner of both immovable and movable assets, but the insurance industry, led by the Insurance Regulatory Authority, has continuously blamed it for its reluctance to insure its assets.
Gen. Wamala said there was no better national social safety net than insurance, but decried the persistently low penetration in Uganda of about 0.8 percent (in gross written premiums as a ratio of GDP).
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He was more concerned about insurance in the transport industry, where even the mandatory Motor Third Party insurance was underperforming.
The insurance association estimates that only more than one-third of motor vehicles in Uganda are insured, with the public attitude that “insurance does not pay” being the main reason for the low penetration.
The minister sounded a special appeal to insurers and other stakeholders for efforts aimed at popularising insurance among the boda boda industry, which, according to him, accounts for the largest number of road crashes.
He said that there was a need for intensified education of the riders on the importance of Third Party Insurance for their good and the good of the passengers, the fact that they are the biggest single business in the passenger transport industry.
“They do a lot of work transporting passengers, yet they are the least insured! We cannot wish them away because they’re doing a good job,” he said.
On what the ministry has done, he cited the eased process of acquiring driving licences for cyclists, including lowering the cost to ensure that they have no excuses.
The minister also stressed the importance of the ongoing review of the Motor Vehicle Insurance (Third Party Risks) Act 1989, to compel medical facilities to handle accident victims first before considering their ability to pay for the treatment.
“Don’t first ask for proof of ability to pay. Save life first, and the modalities of payment can be discussed later,” he said.
He also said the “No-fault approach”, which allows the driver in an accident to claim compensation from the insurer, should be revised to exclude a driver who has no driving license at the time of the accident.
He, however, said that the game changer in the insurance industry would be the establishment of the National Health Insurance Scheme, which has been elusive for more than a decade since the idea was last mooted.
“National Health Insurance is the ultimate form of social protection and the best health financing mechanism,” he said, calling for more education of the Members of Parliament about the initiative.
Dan Musiime, the UIA Medical Committee Chairperson and CEO of Jubilee Health Insurance, noted the low uptake of health insurance by individuals despite the numbers showing a growing trend in the segment.
Medical Insurance contributes over 20 percent to the total Insurance premiums, but this consumption is mainly by companies.
Musiime said 90 percent of the health insurance policies are held by corporations and employers, meaning that individuals account for only 20 percent.
Jonan Kisakye, UIA Chief Executive Officer, repeated calls for enhanced engagement with the Ministry of Finance, Planning and Economic Development and Uganda Revenue Authority over the tax concerns by insurance agents.
These mainly include the proposed amendment to the Income Tax Act to classify insurance agents’ withholding tax as a final tax.
UAP Old Mutual’s Justine Namugosa was named Overall Agent of the Year, with Ssempasa Diana (UAP OM) and Prossy Naluyinda of CIC Insurance Uganda coming 1st and 2nd Runners-up, respectively.
Other award categories were across all insurance segments and businesses operated by agents.