Life insurance has potential to transform economy: Report

According to the Zimbabwe insurance sector survey done by Zimbabwe Independent in collaboration with M&A, life insurance can help to grow the economy.
STRATEGIC advisory firm, Mark and Associates Consulting Group (M&A), this week said life insurance had the ability to encourage domestic savings and investment, spur economic growth, and advance national development.

According to the Zimbabwe insurance sector survey done by Zimbabwe Independent in collaboration with M&A, life insurance can help to grow the economy.

The report was presented on Wednesday during the 2023 Zimbabwe Independent Insurance Survey Awards breakfast meeting in Harare.

“Life insurance has the potential to both mobilise domestic savings and investment and to create employment and enhance household welfare, thereby helping to drive economic growth and development at a crucial time in Sub-Saharan Africa,” the report read.

The report recommended that industry players and policymakers should support the development of life insurance.

“There is a need for capacity building in the insurance sector including training and development,” the report said, further recommending increased focus on research and development.

“This is key as it gives birth to insuretechs that unlock new markets and improve the levels of insurance penetration. We also encourage the use of big data, data sharing and artificial intelligence (AI),” the report added.

There is also need for increased focus on micro-insurance.

“An opportunity exists in Zimbabwe to develop micro-insurance products targeted at the informal economy.”

The report said the crucial role of micro, small and medium enterprises in the national economy was anchored on the roles of government, the business community and the public at large to harness and optimise the sector’s development.

“Agricultural insurance is a useful tool for managing agricultural risks. Position the Zimbabwe insurance sector for the Africa Continental Free Trade Area opportunity,” it said.

The report also indicates that while technology and resultant improvements in risk selection and pricing are likely to remain the primary drivers of improved bottom-line performance, insurers should expect to be increasingly judged by stakeholders on their response to broader sustainability priorities.

These include climate risk, diversity and inclusion, social equity, and transparent governance, all of which could become competitive differentiators in the battle for talent, investors and market share. The report called for the development of life insurance saying it had the potential to mobilise domestic savings, investment and create employment.

The insurance sector in Zimbabwe is developed and has many players that comprise reinsurers, insurers, reinsurance brokers, insurance brokers, loss assessors as well as agents who all play an important role in the provision of insurance to the public.-newsday