Insurance half year premiums grow by Shs104b

Insurance companies recorded an increase of Shs104.9b in gross written premiums in the first half of 2024.
Details contained in the Insurance Regulatory Authority (IRA) performance report indicate that the sector expanded by 12.65 percent from Shs828.9b recorded in the half year ended June 2023 to Shs933.8b due to an increase in business activity.
The report indicates that non-life insurance continued to have the largest share of written premiums, contributing Shs542.3b, which was a 6.3 percent increase from Shs510.1b in the same period last year.
However, life insurance increased significantly by 22.97 percent, rising to Shs357.8b from Shs291b, while contributions from health membership organisations rose by 21.24 percent, contributing Shs33.1b, up from Shs27.3b.
Microinsurance contributed the least amount but registered one of the fastest growth of 32.52 percent, rising to Shs613m from Shs463m.
Mr Ibrahim Lubega Kaddunabbi, the IRA chief executive officer, said the sector had benefited from improved distribution channels, a rise in online transactions, increased customer confidence, and a growing middle class. 
“As consumers’ insurance market becomes more competitive with the entry of non-traditional players, insurers are increasingly enhancing their digital engagements across all touchpoints to meet the rising demand for online transactions,” he said, adding that expansion of the middle class had significantly impacted the life business line as more consumers seek financial products that provide security and long term benefits.
Mr Kaddunabbi also noted that the growth in micro-insurance signaled an increase in financial protection among vulnerable Ugandans, many of whom are seeking to enhance their resilience against unforeseen challenges.
The report also notes that premiums collected through brokers rose to Shs298.3b from Shs257.8b, accounting for 31.9 percent of total insurance premiums, while Shs107.5b, which represents 28.59 percent, was collected through Bancassurance.
Non-life insurance continues to lead with 58.07 percent market share. However, this was a decline from 61.54 percent in the same period last year.
Life insurance accounts for 38.32 percent, up from 35.1 percent, while health membership organisations hold 3.54 percent, an increase from 3.3 percent.
The report also noted that gross claims for both life and non-life sectors, including health memberships, reached Shs423.8b, representing 45.39 percent of the total gross written premiums.
Mr Kaddunabbi said the sector is expected to continue growing, driven by anticipated public sector investments in infrastructure and construction and innovations such as enhanced marine insurance compliance. 
“We project the insurance sector will continue to expand, with growth rates exceeding 10 percent,” he noted.
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