AS THE nation commemorates the Golden Jubilee in two days time I found it necessary to reflect on strides made by the insurance industry in the past 50 years and also highlight some challenges that need to be overcome.
Prior to independence the industry consisted of about 26 insurance companies which at 50 the number is higher by one.
The significant difference is the fact that prior to independence the companies were all foreign whereas currently there are more indigenous ones.
Further we can also talk about three reinsurance companies based in Zambia. With such developments it means some of the risks from primary insurers can be transferred to reinsurers within thereby retaining some money within the economy.
The opening up of the market in 1991 has helped the industry grow from one insurer namely Zambia State Insurance Corporation to 27 insurers driven by the private sector.
This has significantly improved service levels unlike in old days where customers had no option but insure with one insurer.
The setting up of the Pensions and Insurance Authority in 1997 was also a positive move in the Zambian insurance market.
The industry has soared in gross premiums to a tune of about K1.6 billion at the close of 2013.
Although this is still less than two per cent of the Gross Domestic Product it is an amount that cannot be put under the carpet.
Capacity of the industry to retain mega risks remains a challenge that need to be overcome. About 50 per cent of the gross written premiums are paid to foreign reinsurance companies.
Increasing this capacity will contribute positively to the industry.
There is also technical capacity that needs to be addressed for example the use of actuaries and adjusters from outside because in Zambia we have very few or none at all in some areas.
The penetration levels are still under five per cent, though a positive growth from the two per cent in 2002.
This means the industry is still in its infancy with great potential.
The setting up of the technical advisory committee primarily focusing on microinsurance is a positive development will yield great results to the lower income bracket who form majority of the population.
Consumer awareness is what the industry players must put efforts together. I must commend the Insurers Association of Zambia (IAZ) for setting up a secretariat in the recent past.
Such developments must indeed be supported by all stakeholders.
We have witnessed how the association has contributed positively soon after setting up the secretariat, job well done.
Another initiative on consumer awareness that has stood out in my view is the organisation of inter-schools debate by various industry stakeholders.
Readers will agree that in Zambia there are not many platforms where insurance is discussed.
It, therefore, remains that when interest is stimulated among young people then as they grow into society they will consider buying insurance which by so doing will increase penetration levels in the long-run.
Young people are also good messengers meaning they will take the insurance message to parents.
Insurance week initiative is also a milestone stride by the industry. Running consecutively for two years now is something the industry must be proud of and continue building in the quest of promoting consumer awareness.
I also wish to salute the Times of Zambia newspaper for making space available for this column which has been running for close to three years now.
I further wish to thank the sponsors of the column Professional Insurance Zambia PLC and Professional Life Assurance.
Many people have benefited from this space. At 50 we can proudly say we have a column on insurance running consistently.
Well, as we continue to reflect on the strides made by the industry at 50 I must stress the challenge of the lack of documentary evidence which have been poor or not there at all.
It is very difficult to trace the insurance history in Zambia with most of it inhibited by the gurus alive while there are literally no books written to that effect.
Having written the first detailed book on insurance in Zambia I must confess the difficulties I had to verify information from records but thanks to the gurus who were able to pass on the same orally.
At 50 years I feel Zambia needs a lot more of books on insurance and the industry should support such initiatives for the good of the future generation.
On a concluding note the future for the industry looks bright but requires selfless men and women who will work hard especially if the penetration levels are to increase.
Happy Golden Jubilee Zambia
Comments: webster@picz.co.zm or webster_tj@hotmail.com or facebook search for Insuarance Talk-Zambia page or 0977857055.
(The author is a chartered insuarace with ten years industry experience)