Following passage of the Financial Institutions Amendment bill 2016 which included a provision for Bancassurance and the subsequent approval of the regulatory guidelines by the Bank of Uganda (BoU), Stanbic Bank Uganda has become the first bank in Uganda to be granted a license to provide Bancassurance as a product on the Ugandan market.
The Financial Institutions Act 2016 specified that the Insurance Regulatory Authority (IRAU) would be responsible for receiving applications from financial institutions for licensing to conduct Bancassurance business, subject however to prior written authorisation from the Central Bank.
Handing over the license at ceremony held at the IRAU Headquarters in Nakasero on Wednesday, Alhaj Ibrahim Kaddunabbi Lubega, the CEO at IRAU said, “As an industry we are extremely pleased that Bancassurancein Uganda has finally become a reality. At just 0.8%, iInsurance penetration in Uganda is still unacceptably low, selling insurance through alternative channels such as banks will undoubtedly make a huge difference.”
He congratulated Stanbic for getting the license and promised them the IRA’s full support as they begin operations.
Receiving the license on the behalf of the bank, Patrick Mweheire, the Chief Executive of Stanbic Bank noted, “We are extremely proud to be the first Commercial Bank in Uganda to offer Bancassurance. As Stanbic, we have been preparing to launch the service for some time now and have invested significantly in training staff, signing partnerships and putting in place the technology and infrastructure needed to roll out the product smoothly.”
He continued, “Naturally key to the success of this project will involve raising public knowledge and awareness about the various benefits and types of insurance products available through banks. To that end, we look forward to working with the regulator and otherindustry players to run effective communications and stakeholder initiatives that will ensure this happens.”
Talking about the benefits of selling Bancassurance, Lydia Kayonde, Head of Bancassurance at Stanbic Bank explained, “Because everything happens under one roof, Bancassurance will provide customers with a one-stop-shop solution which offers greater convenience, savings and choice. In addition, the premium prices will be better negotiated and product turnaround times will inevitably improve.
Bancassurance is an efficient distribution channel with higher productivity and lower costs to serve than traditional sales channels.”
Stanbic has partnered with seven insurance companies including UAP, Liberty and Sanlam among others.