Tanzania Insurance Regulatory Authority’s Director of Licensing and Marketing Conduct Supervision, Samwel Mwiru said in Dar es Salaam this week while launching Diamond Trust Bank’s Bancassurance services.
Mwiru said that insurance penetration in the country is still very low hence insurers, brokers, banks and other financial institutions should widen their market reach by going rural where the vast majority are uninsured.
“In order for insurance to play its rightful role in the growth of our economy it must contribute at least three percent of GDP (gross domestic product) in the next ten years. Innovation in processes, products and infrastructure is therefore paramount,” said Mwiru.
He pointed out that insurance penetration across Africa has remained at about one percent with Tanzania having a penetration level of approximately 0.7 percent which is very low and need urgent action to boost.
The Tira Director further added that the role of insurance in mobilizing savings and providing protection against disasters cannot be under-rated hence the prevailing low insurance penetration presents a huge opportunity for the local industry to grow rapidly.
He despite the financial sector witnessing rapid growth over the last five years while attract investment from both foreign and local investors, insurance remains laggard which has prompted the government to provide an effective policy and regulatory framework for the industry to grow and support development.
“It’s against this background that the government, through Tira and Bank of Tanzania promulgated bancassurance regulations last year, to provide a requisite legal and regulatory framework for banks and financial institutions to participate effectively in the distribution of insurance products and services,” he added.
On his part, Diamond Trust Bank Tanzania Limited’s Country Manager and CEO, Viju Cherian said the bank has partnered with six insurance companies to sell products across its branches for the purpose of providing a one stop solution for both banking and insurance products to its customers.
Cherian named the insurance companies which DTB Tanzania is partnering as Jubilee Life Insurance, Jubilee General Insurance, Alliance Insurance, Phoenix Insurance, Heritage Insurance and Reliance Insurance. He said that one of the reasons DTB Tanzania launched bancassurance is to focus on small and medium entrepreneurs to enhance financial inclusion.
“With the sizeable client base that we have, we believe that the easy delivery of insurance products for the common man and the small entrepreneurs will help in risk mitigation both commercially and personally,” he said.
The DTB Tanzania boss said with the bank’s mission of providing customer-centric financial services, its partnership with insurance companies will provide a comprehensive suite of insurance solutions to its customers nationwide.
“We are excited to bring our customers a complete product offering that includes insurance products within our branches. Our focus is to cater for all demographics, business entities and economic scales,” Cherian added.
DTB Tanzania has a network of 27 branches in the country with most of which being in Dar es Salaam where it also has its headquarters.