Al Hajj Ibrahim Kaddunabbi Lubega, the chief executive officer of Insurance Regulatory Authority (IRA). COURTESY PHOTO

Non-life insurance companies recorded an increase in profit from Shs19.17b in 2019 to Shs23.77b in 2020, the latest sector report indicates.

According to the insurance industry report for 2020, the industry asset base increased from Shs 551.8b to Shs 640.58bn representing a 16.1% growth. This signals the industry’s capability to absorb risks.

Uganda’s insurance industry has 21 non-life insurance companies, 9 line insurance companies and 5 health membership organisations.

Ibrahim Kaddunabbi Lubega, the chief executive officer at the Insurance Regulatory Authority of Uganda, said the growth in the gross underwritten premium amidst COVID-19 pandemic signals an industry that is able to withstand economic shocks.

“As you are aware, economic activity stalled during the latter part of FY2020/21 due to a domestic lockdown that lasted more than four months, border closures for all but essential cargo, and the spillover effects of disruptions to global demand and supply chains. This resulted in a sharp contraction in public investment and deceleration in private consumption, which hit the industrial and service sectors hard, particularly the informal service sector,” he said, adding that the country’s economic growth, too, contracted.

Uganda’s economic growth is projected at 3.3% this financial year, rising from 3.0% last financial year, according to the Ministry of Finance, Planning and Economic Development.

The revenue collected through bancassurance channels increased from Shs53.6bn in 2019 to Shs83.3billion in 2020 as uptake of medical insurance class of business mainly from corporate institutions increased by 22.9% to Shs243.79billion during the same period. Insurance uptake through digital channels such as Motor Third Party launched last year saw a surge in premiums to more than Shs11billio