Staff Writer
HARARE, The insurance industry is battling confidence issues due a myriad challenges including legacy issues mainly embedded in economic issues.
But the landscape is shifting with the industry remaining resilient despite these challenges.
Tony Van Niekerk (TN) who is the Owner and Editor for the Cover Publications believes that the Zimbabwean insurance industry is very much capable of attracting business outside the country as long as the perception on the country of fixed.
Insurance24 (I24) had a chat with him on this issue. Below are excerpts of the interview:
I24: How can Zimbabwe insurance industry present a clean image in the region and world to attract business?
TN: Zimbabwe has been in a turmoil in the past two decades or so. People don’t really understand how the Zimbabwe market work. They don’t understand how can you run an insurance industry if the currency is not clear. They think that there’s no economy going here anymore in Zimbabwe, but it’s not the truth.
There’s a lot happening in Zimbabwe. And there’s obviously all the difficulties, etc. But there’s a lot happening. It thus becomes very important to clean this perception of how Zimbabwe is seen and I’m sure this stretches to the insurance industry. This applies not only to Zimbabwe but Africa as well.
I24: So, from your side, what do you see as the impasse for insurance growth in Zimbabwe?
TN: I think an important thing is that the insurance industry as a whole, the Insurance institute of Zimbabwe, the insurance industry bodies, the reinsurers and the insurers themselves, should all probably be lobbying more aggressively be working together.
They should lobby the government for example to put across the importance of mashing risk of you want to grow business in Zimbabwe.
Firstly, a business person, you need to be able to manage your risk. And if you can’t manage your risk, you’re not going to take risk. And if you want to do business, you have to take risk.
So, without insurance, how do you ever grow an industry? And as we said, the perception.
Perception is validated if there isn’t comfort in the currency of the country and an understanding that things won’t just change with a unilateral decision, well, we’re going to do this now, or we’re going to do that now.
That it is a collaborative process between industry and the regulators and regulators and governments to work together to sustain whatever industry the insurers are building or have built and to look towards how do you increase and grow that into the future.
Because exactly what we’re saying now, if I’m a person who wants to save in Zimbabwe, take out an investment or anything, how do I know that my money is going to be fine in five- or ten-years’ time when I’ll expect to get that money if things can just suddenly change by somebody up there saying, well, we’re now doing it like this.
And there’s no collaboration. There’s no transition. You can’t get confidence from both the people that have to buy it, the consumers, which is not just individuals, but it’s businesses as well.
You won’t get that confidence to actually put their money there. And then the second one is the people who now haven’t got the confidence to buy insurance won’t have the confidence to invest because they haven’t got confidence that they can manage their risk. So that’s, I think, the conundrum that we have now.
I24: You spoke about collaboration. What’s your comment on the existing legislations?
TN: I think it’s absolutely crucial. You know, more and more we find that the regulators are working with the industries everywhere because they can see the importance of not doing things unilaterally.
But the thing is, it’s not just the insurance regulator. It’s broader than that. It’s the commerce, economic environment, whatever the department is called in a specific country’s government.
But it’s the department of industry and economy, whoever that might be. It’s the department of finance, the reserve bank.
I24: How then can the region assist Zimbabwe insurance to grow?
TN: Yeah, that’s a very important question because if you take Kenya for instance, Kenya’s doing very well from an insurance perspective.
First of all, they come together as an industry and regulators, and they decided what’s the best way forward for regulation for the industry. The regulators acted on that. They created a regulatory environment that is conducive to innovation, conducive to growing the industry.
For instance, bank assurance environment, Insurtech, etc. They got that as an important focus to grow, and you saw it happening. That’s why Kenya’s doing so well.
That’s why Kenya’s innovations are spreading in the rest of the region. They should do the same to try and assist and put, I wouldn’t say put pressure, but to influence the regulators in Zimbabwe and the government in Zimbabwe to try and say, this is how it can be done.
To be positive, to create a better future for the insurance industry, which drops off on the business environment, and you will attract business, because they can ensure their risk. Then they will come.
