Ibrahim Lubega Kaddunabbi, the Chief Executive Officer at IRA
A decade after its introduction, micro-insurance in Uganda has emerged as a key tool for protecting people against unforeseen losses.
Although it still accounts for a modest 0.2 per cent of the country’s total insurance market, its growth has been remarkable.
According to the 2025 Half-Year Industry Performance report by the Insurance Regulatory Authority of Uganda, micro-insurance premiums reached 2.1 billion Shillings in the first six months of the year, more than triple the 0.61 billion Shillings recorded in the second half of 2024, marking a 242.7 per cent increase.
This surge highlights the rising appeal of micro-insurance as a safety net for Uganda’s low-income population, signaling a promising future for the sector despite its current small share of the market.
Micro-insurance works by pooling the risks of many low-income individuals and households against specific unfortunate events, such as illness, injury, or death, through regular, affordable premium payments. When a client experiences a covered loss, the pooled funds are used to provide financial compensation or support, helping them recover from the shock without falling deeper into poverty.
Providers offer products with simple, tailored policies and flexible delivery channels, often incorporating mobile technology, to reach and serve underserved populations in developing countries. Micro-insurance in Uganda works by providing low-cost insurance products, often through partner-agent models with microfinance institutions and mobile networks, to protect the targeted persons from financial shocks.
Policyholders pay small, regular premiums in exchange for small payouts, and simplified processes, like WhatsApp-based claims, facilitate claims processing for clients. This has been a result of the key role of the IRA in regulating the market and encouraging innovation, such as the development of user-friendly mobile and digital platforms to improve access and uptake of these crucial services. Other products are tied to payment for different products, like sending mobile money to a loved one, which earns the sender a policy.
Commenting on the growth of micro insurance, Ibrahim Lubega Kaddunabbi, the Chief Executive Officer at IRA, said that this also shows that more people, especially the underserved, rural and low-income earners, were increasingly understanding and accessing the benefits of insurance. He says that efforts have been directed to this because it is the insurance service that will genuinely touch most Ugandans.
These figures do not include Motor Third Party premiums paid through micro insurance platforms. Overall, over the period, the insurance industry recorded a half-year growth in total Gross Written Premium of 1.06 trillion Shillings, compared to 933.76 billion recorded in a similar period in 2024, a growth of 8.78 per cent in premiums.
The total premiums also represent 56.7 per cent of the total premiums collected over the whole year in 2024 (1.79 billion).
“The positive growth reflects increased market activity and continued improvement in levels of confidence within the industry,” says Lubega. Life insurance business recorded 402.71 billion Shillings compared to 357.81 billion at the end of the second quarter 2024, while non-life business generated 572.60 billion in GWP, up from 542.27 billion Shillings.
Health Membership Organisations, usually known as medical schemes, generated 38.28 billion Shillings compared to 33.07 billion Shillings at the end of the second quarter of 2024, representing a 15.76 per cent growth in premiums.
The industry continues to be dominated by the non-life segment, which accounted for 56.38 per cent of the aggregate industry written premiums. Life business accounted for 39.65 per cent of the aggregate industry written premiums, showcasing its robust and growing market presence.
Despite these growth figures, insurance penetration has been relatively slow to grow and remains at about 8 per cent of GDP. Protazio Sande, Director of Research and Market Development, says the low penetration should not be used to gauge the performance of the industry. He says, for example, that the economy has been growing, but also that it has been rebased several times, pushing up the national income while the industry figures only grow naturally.
According to Sande, what matters is the growth of the absolute figures, like the written premiums.
The period also saw gross claims worth 442.73 billion Shillings paid out, representing 43.6 per cent of the 1.016 trillion in total industry Gross Written Premiums. This is as compared to 423.8 billion, which was paid in the half-year period ending June 2024.
“This highlights the substantial financial impact of claims on the industry and reflects the growing benefits being delivered to policyholders,” says CEO Lubega. On the future of the industry, he says there are all indications of continued growth, with most opportunities being in rural areas, which are highly underserved.
There was also an increased uptake of insurance through Bancassurance, where 137.48 billion Shillings in GWP was registered, representing a 27.93 per cent increase and 13.54 per cent of total industry premiums. This reflects strong consumer preference for life products distributed through banks, largely driven by convenience and trust.
Between the second quarter of 2024 and of 2025, the insurance industry recorded a significant expansion in coverage, with the total number of insured people rising from 405,837 to 506,119, representing a 24.7 per cent growth.
This increase translates into more than 100,000 additional lives covered within one year, underscoring the sector’s growing contribution to financial protection and social security. Individual policies grew from 352,395 to 402,405, strongly supported by the uptake of micro-insurance, which nearly doubled from 62,220 to 111,856, reflecting increased access for low-income and informal sector households.
On the other hand, group policies emerged as the fastest-growing segment, nearly doubling from 53,442 in the second quarter of 2024 to 103,714 in Q2 2025. This indicates a strengthening role of employer-driven and institutional insurance schemes, which are increasingly anchoring collective risk protection for employees and organised groups.
Stephen Kaddu, the Manager of Inspection, says this is because employers are increasingly offering insurance as an employment benefit.
Overall, the results point to a sector that is broadening its base through both mass-market micro-insurance and group-based risk pooling, thereby enhancing financial inclusion and workplace protection.
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