On 23rd May 2023, the Africa College of Insurance and Social Protection (ACISP) launched its Capacity-Building Program For Inclusive Insurance in collaboration with the United Nations Development Programme (UNDP) at its headquarters in Dar es Salaam.
The project aims to create more efficient and impactful insurance markets by improving the quality and quantity of insurance through a structured approach to capacity building.
“The program is a collaborative effort to establish a comprehensive and transformative insurance capacity-building training program in Tanzania and thus build a network of insurance professionals with the necessary skills to develop and deliver insurance solutions across the insurance value chain that will foster sustainable development in the country,” the program’s pamphlet reads.
Commenting on the new program, Sosthenes Kewe, Executive Chairman of ACISP, explained that in recent years, Tanzania has gained global attention for its rapid growth in financial inclusion driven by digitalization. Hence the need for the insurance industry to similarly grow and innovate, emphasizing the need for competencies, capacities, and professionalization within the sector.
“The insurance industry must adapt to the changing environment and transition from a seller’s market to a buyer’s market. This includes addressing emerging challenges such as climate change, cybersecurity risks, and the digitization of business models,” Kewe stressed.
For her part, Christine Musisi, Resident Representative of UNDP in Tanzania, explained that the main areas of partnership include the insurance sector, in an effort to strengthen its capacity. The UNDP views micro and small-scale insurance as a critical tool to support smallholder farmers and small to medium enterprises, allowing them to remain sustainable, productive, and profitable even during challenging times.
“The UNDP is particularly interested in the aspect of inclusive insurance, which they believe can significantly help many smallholder farmers, impoverished communities, and young people who currently struggle to access financing and invest confidently in their small businesses and farms. The UNDP is hopeful that this training program will cultivate a competent and effective insurance sector, capable of reaching out to the poorest and preparing innovative and transformative products that will broaden the use of insurance in Tanzania. The ultimate goal is to build trust in the insurance business among all people, especially those who have been traditionally underserved.”
Tanzania Insurance Sector
However, overall insurance penetration in Tanzania, which includes public and private insurance as a percentage of GDP, was approximately 1.68% in 2021.
The ratio slightly increased compared to a penetration ratio of 1.55% in 2020 and 1.58% in 2019.
The Tanzanian government aims, by 2030, for 90% of the population to be covered by health insurance, for 50% of the adult population to have access to and use insurance products, for 20% of adults to have life savings products, and for 10% of retirement plan beneficiaries to use annuity products. All in all, it expects that insurance penetration will reach 5% by the end of this period.