Stanbic Bank has become the first bank in Uganda to be granted a bancassurance license by the Insurance Regulatory Authority of Uganda.
This follows the passage of the Financial Institutions Amendment bill 2016 which included a provision for bancassurance and the subsequent approval of the regulatory guidelines by the Bank of Uganda BOU.
The Financial Institutions Act 2016 specified that the Insurance Regulatory Authority IRAU would be responsible for receiving applications and licensing financial institutions to conduct Bancassurance business with authorisation from the Central Bank.
“The introduction of Bancassurance as a strategic distribution channel of insurance is one of the most significant recent developments in the financial services sector in Uganda,” Kaddunabbi Ibrahim Lubega, the CEO of Insurance Regulatory Authority of Uganda said while handing over the license to Stanbic Bank’s chief executive, Patrick Mweheire, at a ceremony held at the authority’s headquarters in Nakasero,
Bancassurance “will increase access to insurance services amongst Ugandans in different parts of the country through the vast bank branch network,” Mr Lubega said.
“The high level of confidence and trust generally placed by the public in banks makes them particularly well positioned to attract consumers to purchase insurance products from their distribution outlets. It is through such partnerships that the insurance industry can grow and increase its penetration in Uganda,” he added.
Mr Mweheire said Stanbic was “extremely proud to be the first commercial bank in Uganda to offer bancassurance.” He said the bank has been preparing to launch the service “for some time now’ and has invested significantly in training staff, signing partnerships and putting in place the technology and infrastructure needed to roll out the product smoothly.
Lydia Kayonde, Stanbic’s head of bancassurance said it will “provide customers with a one-stop-shop solution which offers greater convenience, savings, and choice.”
“In addition, the premium prices will be better negotiated and product turnaround times will inevitably improve,” she added. “Bancassurance is an efficient distribution channel with higher productivity and lower costs to serve than traditional sales channels.”