Insurance brokers have stepped up efforts to prepare themselves for opportunities in the new oil and gas sector.
Maurice Amogola, the chairman of the Uganda Association of Insurance Brokers (UAIB) and chief executive officer of AON Uganda Ltd, says they resolved to start training staff on guarding against the risks in the oil industry.
After the discovery of huge deposits in the Albertine region, Uganda hopes to start commercial oil production in 2018.
"We expect many risk-assessment jobs to be created in this sector and more of our colleagues will get employed because more companies have come in. So, we want to train and understand the risks that are likely to come up in the sector," Amogola said after UAIB's annual general assembly held recently at Protea hotel in Kampala.
Amogola argues that one reason the penetration of insurance services in Uganda remains low is because government, the biggest single business entity, doesn't insure most of its assets. Insurance is still viewed as a cost for the rich, Amogola said. Uganda's consumer insurance uptake accounts for a dismal one per cent of Gross Domestic Product compared to three per cent in Kenya and 12 per cent in South Africa.
Amogola argues that this is where insurance brokers, who advise on risks for business and people, should come in and bridge the gap.
"Our work is clearly cut out," Amogola said, emphasising that the service is free because brokers are paid by insurance companies. Although there has been improved insurance uptake in the corporate sector, Amogola says insurance brokers must step up customer education, especially among the private businesses.
"Ugandans have nice houses, attractive enterprises and expensive cars but they never insure them," he said.
According to UAIB statistics, 40 per cent of the insurance premiums in the past year were purchased through brokers. Currently, there are 27 registered insurance brokers in the country. Brokers are required by law to have a minimum premium of Shs 75m.
Meanwhile, brokers voted UAP the insurer of the year during the annual insurance awards gala held after their AGM. UAP, according to brokers, excelled at offering good services and better claims settlement processes.