The Insurance Regulation and Control Agency (ARCA), in collaboration with the Association of Insurers of Burundi (ASSUR), organized the week dedicated to insurance in Burundi, 2024 edition. It is an opportunity to raise awareness among public authorities and potential policyholders on the interest and role of insurance in the economic development of the country.
The week dedicated to insurance represents an opportunity to raise awareness among public authorities and potential policyholders about the importance and role of insurance in the country’s economic development.
The week dedicated to insurance takes place in Bujumbura from July 25 to 27, 2024 under the theme: “ Innovation, serving the development of the insurance sector “. Since 2022, insurance companies and other players working in this sector have been mobilizing to prepare this week dedicated to insurance, an awareness-raising and education activity on insurance. To date, three editions have been organized.
According to Odace Niyonzima, Minister in charge of Finance, the week dedicated to insurance follows the public awareness campaign on insurance that ARCA, in collaboration with ASSUR, has been carrying out throughout the country since 2021. This awareness was carried out through the holding of regional workshops for insurance sector partners, the media, local administrators, traders, representatives of different sectors of activity, etc. Different strategies were used, including mass awareness tools such as audio and video spots broadcast on radio or television, shows/soap operas such as Ni Nde? and Barushenguhere, messages published on social networks such as Facebook, X (formerly Twitter), WhatsApp, insurance bulletins, etc.
The insurance sector is changing
The awareness campaign had a positive influence on increasing the insurance industry’s turnover, penetration rate and insurance density. Today, the insurance sector is experiencing remarkable growth “, says Mr. Niyonzima. He gives some examples: a legal and regulatory framework inspired by international standards has been put in place, which has allowed the opening of the insurance market to new operators. Today, the insurance industry has 22 insurance companies including 12 non-life insurance companies and 10 life insurance companies, while in 2015 there were 16 insurance companies that practiced both the life and non-life insurance regime. The sector also has 30 brokerage companies compared to 9 companies in 2015.
The third edition of the insurance week was the occasion to lay the first stone for the construction of a speed bump on Muyinga Avenue.
In addition, the turnover of the insurance sector has increased. It has recorded continuous growth, from 54.4 billion BIF in 2019 to around 90 billion BIF in 2023. The penetration rate of the sector has increased from 0.87% in 2019 to 1% in 2023. The density of insurance, i.e. the average annual expenditure per capita on insurance products, has increased from 4511 BIF in 2019 to 7000 BIF in 2023.
Investments made by insurers are also growing. The assets of the insurance sector were worth 299 billion BIF in 2022 compared to 199 billion BIF in 2018, an increase of more than 100 billion BIF in five years. Mr. Niyonzima is pleased that the majority of insurance companies settle claims quickly or within the required time frame, with the exception of a few that have liquidity problems. However, administrative sanctions are applied to companies that repeat the offense of exceeding the legal deadlines for the payment of claims or that do not transmit the required data.
« We encourage insurance companies to always honor their commitments to policyholders and beneficiaries of insurance contracts in accordance with the provisions of the Insurance Code. This positively influences the image of insurers among the population and establishes trust between insurers and policyholders. “, says Gervais Ndirakobuca, Prime Minister of Burundi. He adds that the government of Burundi congratulates insurers for their contribution to the prevention of road traffic accidents by building, during the activities celebrating the week dedicated to insurance in Burundi, speed bumps in Bujumbura in 2022 and in Gitega in 2023. He invites them to initiate other activities of public interest with a view to contributing to the reduction of accidents and claims, and thus contributing to the development of the country.
Challenges to overcome
Despite some progress, the insurance sector is facing various challenges. According to the president of ASSUR, Rénovat Gahungu, some provisions of the insurance code are difficult to apply or do not comply with international norms and standards. Some decisions and measures that have not been concerted become inapplicable. In addition to this, it is necessary to point out the problem of pension fund management, the problem of training market players, the lack of education of the population on insurance and the poorly rendered judgments in the courts and tribunals, whose judicial convictions exceed the limits of what is acceptable. The consequences of all this are that the insurance penetration rate in Burundi remains low and its share in the gross domestic product (GDP) is also low.
In addition, the insurance sector faces a lack of qualified human resources because Burundi does not have an insurance training structure. Some insurance training opportunities have been created by international organizations, according to the Minister in charge of finance.
What do we have to do ?
Despite the challenges, given the central theme of the week dedicated to insurance (third edition) ” Innovation, serving the development of the insurance sector “, Mr. Niyonzima hopes that the players in the Burundian insurance sector will realize that they must innovate and differentiate themselves to retain their customers and attract new prospects. They must develop inclusive insurance products for low-income populations, use technology and data to improve insurance services, that is to say, set up electronic subscription or claims settlement platforms. In order to popularize them, it will also be necessary to launch new offers, get rid of bureaucracy and go into the field to meet customers, but also reinvent the customer relationship. This is how they will be able to increase their turnover and further increase the insurance penetration rate.
The week dedicated to insurance (third edition) was the occasion to solemnly open the Radio Voice of Insurance in Burundi (RAB).
As for the Prime Minister, it is necessary to improve the low insurance education of the population. It is necessary to introduce micro-insurance products that are accessible to low-income populations and that take into account their needs in order to increase their resilience and prevent them from falling into a cycle of poverty in the event of painful and uncertain events.
By establishing the week dedicated to insurance in Burundi, insurers aim for three objectives such as raising awareness among public authorities and potential policyholders of the entire Burundian population on the interest and role of insurance in the economic development of the country, exchanging with all partners on the challenges and constraints facing the insurance industry in Burundi and the ways and means to remedy them, promoting the strengths and opportunities presented by each partner in the insurance industry. For this year 2024, this event was an opportunity for distinguished guests to lay the first stone for the construction of a speed bump (bump) at Muyinga Avenue and to solemnly open the Radio Voix de l’Assurance au Burundi (RAB).
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