Staff Writer

Deputy Finance Minister Kuda Mnangagwa has challenged Zimbabwe’s insurance industry to move beyond traditional policy sales and become a central pillar of the country’s economic resilience as climate change, technology and geopolitical shocks expose growing gaps in insurance protection.

Officially opening the 24th annual conference of the Association of Insurers and Reinsurers of Developing Countries (AIRDC) in Harare, Mnangagwa said insurance had to become more accessible to households, farmers, small businesses and informal enterprises if Zimbabwe was to withstand increasingly frequent economic and climate shocks.

He said the insurance sector should be treated as economic infrastructure, arguing that a strong industry could help businesses invest, protect livelihoods and reduce the financial burden placed on Government when disasters strike.

“The bigger question is, how do we build insurance markets capable of participating, absorbing and responding to risks that are changing before our eyes?” Mnangagwa said.

His remarks come at a critical time for Zimbabwe, where a large informal economy, climate-dependent agriculture and limited insurance coverage continue to leave many households and businesses exposed to shocks.

Mnangagwa said the country and other developing economies could no longer rely solely on conventional insurance models when the nature of risk itself was changing.

Geopolitical tensions, climate change, cyber threats and artificial intelligence were rapidly transforming the operating environment for insurers, requiring the industry to rethink both its products and distribution models.

Zimbabwe’s vulnerability to drought was particularly highlighted, with Mnangagwa warning that climate risk was already affecting agricultural production, livelihoods, food security, infrastructure and public finances across the region.

He pointed to the outlook for the 2026-27 agricultural season, which he said indicated increased climate risks in Southern Africa, including below-normal rainfall in parts of the region and a greater likelihood of above-average temperatures.

“We cannot wait for a drought to become a disaster before we begin financing the response,” he said.

For Zimbabwe, where agricultural output remains heavily dependent on rainfall, Mnangagwa said insurance needed to become part of the country’s broader climate adaptation strategy rather than simply serving as a mechanism for compensating losses after disasters had occurred.

He called for greater adoption of agricultural insurance, index-based and parametric products, catastrophe-risk financing and public-private partnerships.

The use of satellite technology, weather data and predictive analytics could also help insurers develop products capable of providing quicker protection to farmers and vulnerable communities, he said.

“For a region in which millions of livelihoods depend on rain-fed agriculture, insurance must become an integral component of climate adaptation and agricultural resilience,” Mnangagwa said.

Technology, he said, could also help Zimbabwe address the country’s insurance protection gap by reducing the cost of reaching customers.

Artificial intelligence, big data, mobile platforms and digital distribution could allow insurers to reach customers who have traditionally been excluded from formal insurance because of cost, distance or complex administrative requirements.

“A smallholder farmer in a remote community should not have to travel to a major city to access insurance, and a small business should not have to complete complicated paperwork merely to protect its assets,” Mnangagwa said.

But the Deputy Minister warned that digitalisation also introduced new risks, particularly around cybersecurity, data protection, algorithmic bias and consumer protection.

“Digital transformation without digital trust will not deliver sustainable financial inclusion,” he said.

For Zimbabwe’s insurance industry, the challenge is therefore two-fold: expanding access while ensuring that rapid technological adoption does not create new vulnerabilities.

Mnangagwa also placed emphasis on the role of reinsurers in strengthening the capacity of developing insurance markets, calling for deeper cross-border relationships and greater technical cooperation among AIRDC members.

He said developing countries shared many of the same challenges, including low insurance penetration, protection gaps, climate vulnerability, informality and limited technical capacity.

Zimbabwe could benefit from learning from markets that had developed practical solutions to these challenges, while also sharing innovations developed locally, he said.

Mnangagwa said the conference should therefore produce practical outcomes rather than simply generate discussions, challenging delegates to leave with new partnerships, stronger reinsurance relationships and workable strategies for deploying technology and closing insurance gaps.

He welcomed plans for the conference to produce a white paper capturing lessons and experiences from participating countries.

The document, he said, should provide an opportunity for Zimbabwe to showcase its own innovations while drawing lessons from other developing markets facing similar economic and structural challenges.

“The future of insurance in developing markets will not be secured by protecting yesterday’s business models; it will be secured by understanding tomorrow’s risks,” Mnangagwa said.

He said disruption should not only be viewed as a threat, but also as an opportunity for insurers to develop new products, strengthen resilience and make insurance more relevant to ordinary people.

For Zimbabwe, the message from the conference is increasingly clear: with climate shocks becoming a recurring economic risk and technology reshaping financial services, the insurance industry will have to move closer to the communities and businesses that need protection most.

The AIRDC conference brings together insurers, reinsurers, regulators and other industry stakeholders from developing markets across Africa, Asia, the Middle East and the Americas to examine how the sector can remain resilient amid rapidly changing global risks.