INSURANCE! Experts’ advice on how and where to invest for financial wellness
By Moses Oketayot
Insurance and investment experts have advised the public to invest in businesses that they understand or invest with regulated entities to avoid making losses.
Zac Kisesi, the head of Alternative Channels at UAP Old Mutual Financial Services says currently in the country there is a drive for saving, where many people are collectively investing money.
Kisesi advises the youth to invest in businesses they understand.
He made these remarks during a financial wellness workshop for journalists at Nakawa Business Park on Tuesday.
He further advised the public to invest their money where there is a regulator which acts as a safety net.
“The beauty with a regulator is that they will protect you against ponzi schemes, get-rich-quick schemes.”
The regulators for the insurance and pension sector are the Insurance Regulatory Authority and Uganda Retirement Benefits Regulatory Authority respectively.
Concerning the Old Mutual Unit Trust Fund, and its benefits, Kisesi says that it has quality and qualified fund managers, and investment professionals who make sure that one’s money is invested prudently as you gain knowledge in the business to start up in the future.
According to Kisesi, it is never too early to start saving, because the money will be invested and gain interest so that by the time you acquire the required business start-up skills it would come in handy.
However, he advises against investment in housing and real estate because according to him, the returns on investment are low, adding that mortgage is more about status symbol in society.
On the issue of creating more awareness about insurance, Stephen Lubowa, the Head of Marketing and Business Development at UAP Old Mutual Insurance, says that insurance penetration in Uganda is below one percent as compared to Kenya at three percent, and that as a leading player in the market they want to create more awareness so that the narrative can change and people start appreciating the benefits of insurance.
To further create more awareness about insurance, Lubowa says that the company plans to carry out awareness drives countrywide in partnership with government agencies and corporate organizations, so that people get to know about the importance of insurance, more especially life and health insurance.
The experts also opine that financial inclusion can only be achieved if the risk elements are taken care of, because most individuals think that it is easy to save without looking at the risk element which is impossible since savings can be wiped away in an unlikely occurrence, which only insurance can come in to save the situation.
They further underscored the importance of having an insurance policy to take care of unexpected eventualities like death, permanent disability, and chronic illnesses like cancer, among others.
During the Covid-19 pandemic, claims in the insurance sector moved up to 40%.
According to Lubowa, in 2021 alone, they paid out about Shs57b in claims, part of which were maturities and surrenders because people were in need of funds to be able to re-start their businesses and meet daily expenses.
Due to the medical challenges faced during the Covid-19 pandemic, Covdi-19 was embedded into many insurance player’s cover for value proposition though it was not part of the covers.