By Kondwani Phiri – Actuarial Analyst
- Stanbic becomes the first bank in Zambia to receive an insurance brokers license
- License allows for full implementation of the Bank’s Bancassurance Strategy
The Pensions and Insurance Authority – PIA has issued the first ever insurance brokerage license to a commercial bank, Stanbic Zambia. This was disclosed to the nations premier business newspaper dubbed ‘The Zambian Business Times’ by Chief Executive Officer of Stanbic Insurance Brokers Chilufya Nyirenda. The licence gives Stanbic Insurance Brokers Zambia Limited the ability to distribute a competitive range of industry leading, segment specific insurance products from multiple underwriters. It will also allow for full implementation of its Bancassurance strategy as part of its goal to meet clients’ broader financial service needs, enhancing loyalty and creation of non-funded income which aligns well with the bank’s objective of setting new frontiers for growth, Nyirenda said.
The services offered are tailor made to meet the needs of both existing and prospective customers in addition to providing convenience and necessity.
“Stanbic is unwavering in its quest to form fruitful partnerships with its clients in their personal development and success. Therefore, we will continue to develop methods by which we can anticipate our client’s needs and provide suitable solutions in line with our goal to make a positive impact in people’s lives,” added Chilufya Nyirenda said.
“Zambia’s insurance industry is currently undergoing metamorphosis with realization that insurance and pension funds are key liquidity drivers that have either under-performed or been under utilized over the last decades. Various reforms ranging from increased capitalization requirements to more stringent regulation around the role they play in the financial markets have led to increased attention on these market players. Competitiveness of the insurance industry is rising at a fast pace with the likes of Madison, Zambia State Insurance Corporation – ZSIC, Prudential and Professional insurance gaining momentum in the market. Having a commercial bank step into the ‘semi oligopolistic’ to ‘mildly competitive’ market will yield the requisite efficiency, competitiveness and price disruption in the provision of insurance products and services. The brokerage side of the insurance industry currently grapples with liquidity and as such provides massive opportunity for commercial banks that are key players in the cash markets to tap into.
Commercial banks have for a long time ‘cocooned’ their insurance potential in Bancassurance units that have not yielded adequate visibility thereby not impacting the liquidity cash markets in a manner expected. We expect to see more usage of the capital markets to raise funding for such developments. This development is one step towards complexity of banking morphing to step into the insurance space causing a healthy shakeup. Such developments spell deepening of financial markets which is long overdue in Zambia. The reality is that the birth of Stanbic Insurance Brokers is a sign of confidence by the PIA in the entity. ” Actuarial Analytics desk commentary.
The goal is to encourage more entrepreneurs to come forward and access financing for their business ideas and help reduce unemployment and grow the economy.
In addition, Stanbic offers embedded insurance covers for account holders in silver, gold and platinum segments; providing customers with value add services. Business owners can also be protected against loss of money or property sustained as a result of acts of fraud, theft or dishonesty by an employee in the course of employment,” she concluded.”
Other insurance products offered by Stanbic include comprehensive motor insurance and homeowner’s protection plans, which protect against accidental loss or damage to the physical structure of a home caused by such issues as lightning, fire, flood, falling trees, burglary among other risks.
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