Go for innovative solutions, says NBC Director

DODOMA: The Managing Director of the National Bank of Commerce (NBC), Mr. Theobald Sabi, has emphasized the vital role of technology, public awareness, and strategic partnerships as central to stakeholders in the insurance sector.

Elaborating, he added that banks and mobile network operators are also essential solutions to enhance and accelerate access to inclusive insurance services in the country.

Addressing a gathering of insurance industry stakeholders during the culmination of the 2024 Insurance Day celebrations in Dodoma over the weekend Sabi, who also serves as the Chairman of the Tanzania Bankers Association (TBA), presented a detailed keynote speech themed “Inclusive Insurance: Responsive Products and Distribution through Technology,”

The event brought together an esteemed panel, including the Minister for Community Development, Gender, Women, and Special Groups, Dr. Dorothy Gwajima, the Insurance Commissioner, Dr. Baghayo Saqware, his deputy, Ms. Khadija Said, and the Tanzania Insurance Ambassador, Engineer Zena Ahmed Saidi, who also serves as the Secretary of the Revolutionary Council and Chief Secretary of the Revolutionary Government of Zanzibar,
Sabi highlighted the significant impact of technological advancements in driving positive transformations within the insurance sector.

“With only 10 percent of Tanzanians currently engaged in insurance (Finscope, 2023), technology-driven solutions are essential to bridging this gap.” he said.

He emphasized that innovation goes beyond merely meeting customer needs; it also enhances product availability, strengthens distribution channels, curbs fraud, and mitigates risks.

As of August 2023, Tanzania’s insurance contribution stood at 1.68 per cent of GDP, among the lowest in the region.

Sabi commended the efforts of the government and industry stakeholders in aiming to raise this figure, with a target of 3 per cent by 2024 and 5 per cent by 2030 to align with global benchmarks.

Citing challenges limiting insurance growth as including low disposable incomes, limited savings culture among the populace, and negative public perceptions of insurance products, Mr Sabi proposed a multifaceted approach to address these issues.

He advocated for increased financial education campaigns and the development of affordable insurance services tailored to low-income groups.

“By adopting a technological approach, particularly through mobile platforms, usage of data for informed decisions and enhancing collaboration with other stakeholders, including agents like NBC Wakala, we can significantly improve insurance service delivery in rural areas, where the need is immense,” he pointed out.

ALSO READ: TIRA, stakeholders lead initiatives to boost insurance awareness

However, he mentioned successful examples such as Vodabima from Vodacom Tanzania and NIC Kiganjani from the National Insurance Corporation (NIC) to have demonstrated the effectiveness of mobile-based insurance services in increasing access to this vital service.

Mr Sabi also emphasized the need for transparent claims processes to foster public trust and called for robust fraud and risk management systems, which go towards supporting the sector’s growing digitization.

He added: “With digitization, we also see an increase in cyber frauds.  There is an urgent need to strengthen the risk and compliance area.”

Drawing on the experience of NBC Bank, Sabi described the institution’s substantial contribution to the growth of the insurance sector in the country.

“As a bank, we take pride in being a major player in the bancassurance sector, contributing 18.3 per cent of the market’s gross written premiums (GWP) and driving 45.7 percent of life insurance payments in the last four years,” he stated.

Highlighting the bank’s initiatives, Mr Sabi mentioned the introduction of crop insurance for tobacco farmers and the ‘Wakulima Afya’ medical insurance program, which have benefited over 200 farmers in Lindi, Masasi, and Mtwara.

He also emphasized the critical role of the bank’s extensive network of over 16,000 agents nationwide in increasing access to insurance services, particularly in rural communities.

The bank plans to empower an additional 3,000 agents by 2028 to further strengthen its distribution network.

To support these agents, Sabi revealed that NBC Bank has implemented modern fraud prevention systems and mobile technology solutions, such as the Policy Pro app, which streamlines operations and ensures regulatory compliance.

Reaffirming the potential of mobile technology to revolutionize Tanzania’s insurance sector, he said with widespread mobile phone and internet access, Tanzania is uniquely positioned to reach underserved populations and provide every Tanzanian with affordable, accessible insurance solutions.

Speaking as the TBA Chairman, Sabi reaffirmed the association’s commitment to supporting the growth of the insurance sector in the country. ”

“Inclusive insurance is not just a possibility it is an imperative. By working together banks, insurers, technology providers, and the government we can create a strong ecosystem that makes insurance accessible to all Tanzanians, regardless of their location or economic status.” he stated