Africa remains underinsured: Mthuli

Africa remains underinsured: Mthuli

Staff writer

Finance Minister Mthuli Ncube has said Africa remains desperately underinsured, with an average insurance penetration of 2.7% in 2022 against a global insurance penetration of 7%.

In his speech at the ongoing Insurance and Pensions Regulators Retreat for Africa yesterday,he said it was surprising to note that the uptake of Bitcoins and other virtual assets in some African countries exceeded insurance uptake.

“This is notwithstanding that we are only 7 years away from 2030, which is the target year for attaining the SDGs, including the global commitment of ‘Leaving no one behind and no place behind’.

Mr. President, if the insurance industry is to support governments in attaining the 2030 Sustainable Development Goals (SDGs), more needs to be done to reach out to the uninsured and those who are informally insured in our African markets,” he said.

Ncube said the issue of financial inclusion was thus not just a national agenda but also a regional and global agenda.

In the same vein, he added that there is a business case for insurers to tap into the huge informal sector of most African economies.

“According to the African Union, only 17.8% of the African population had access to at least one social protection benefit in 2019, while the global average was 45.2%. This gap reflects the need for more investment and innovation in the design and delivery of social protection systems that are inclusive, adaptive, and responsive to the diverse needs and risks of the people,” he said.

Ncube said African economies are faced with several threats and vulnerabilities that require protection through insurance.

Accordingly, he said insurance and social protection mechanisms play a key role in ensuring the real sectors of the economy, individual lives, and has an unparalleled capacity to pool long long-term savings for economic development.

“Thus, as governments, we value the importance of your sector in driving economic growth and development.

As governments, it is our desire to see this industry reach its full potential and would like to reaffirm our commitment to the provision.

of an enabling PESTEL environment that fosters the growth and stability of the industry. Therefore, we urge you, as practitioners in the insurance industry to provide policy advice on how best we can unleash the potential of this important industry.

To this end, I recommend that these should have an agenda on policy issues that should be tackled by African governments to support this sector.”