Take up insurance banking, says BoT

22Nov 2021
Getrude Mbago
The Guardian
Take up insurance banking, says BoT

BANK of Tanzania (BoT) deputy governor Dr Bernard Kibesse has urged banks and other financial institutions to be more innovative and start investing heavily in bancassurance products so as to increase penetration of the services to more people and stimulate financial inclusion.

Dr Kibesse made the call in Dar es Salaam over the weekend when officiating at the first intake graduation Certificate of Proficiency in Bancassurance at the Africa College of Insurance and Social Protection (ACISP). He represented the deputy minister for Finance and Planning Eng Hamad Massauni.

The deputy governor said banks and institutions should now put more efforts in the bancassurance area as its potential is yet to be fully exploited.

He noted that access to financial services reduce vulnerability and increase income generation, so players have to think ‘outside the box’

“As a new field in the banking sector, graduates should show their competence and support development of the bancassurance,” he noted.

He said Tanzania's economy is growing at a rate of 4.3 percent despite being hit by the impacts brought by the COVID-19 pandemic. There is a need for more resilient financial services that responds to the current challenges and needs.

“In order enhance bancassurance penetration in Tanzania, BoT and the Tanzania Insurances Regulation Authority (TIRA), issued guidelines to govern bancassurance in banks and other financial institutions, so it time now for the financial institutions to respond by training staff but also improving education programs for the public to know,” he said.

He also appealed to banks, insurance companies and others players in the insurance sector to work in synergy with the ACISP to develop more courses that will help promote more competent graduates to support the country’s economic development.

He said the current 0.65 percent insurance penetration rate is still very low and this sends a strong alert to the players in the sector to make more concerted efforts to improve the industry.

He further urged players across the insurance value chain to work in synergy to support the achievement of the goals highlighted in the country’s Financial Sector Development Master Plan 2020–2030.

The master plan has set ambitious goals for the insurance sub sector within a decade to reach 50 per cent population coverage of the adult population.

Dr Baghayo Saqware, ACISP executive chairman said; “This day marks the graduation ceremony for the first batch of the graduates of Certificates of Proficiency in Bancassurance since the inaugural and commencement of bancassurance business in Tanzania in 2019 when the BoT endorsed regulations to govern the field.”

He said since the introduction of the regulations, ACISP is the first institution to prepare and design the curriculum of the Certificate of proficiency in Bancassurance.

“Bancassurance being a new marketing approach, especially in a market structure of Tanzania, some serious aspects need to be understood and eventually adopted properly,” he added.