Equi-Life: What Uganda Has Been Waiting for To Increase Insurance Penetration in Uganda
Uganda’s insurance sector has demonstrated significant growth in recent years, with gross written premiums increasing from UGX 1.44 trillion in 2022 to UGX 1.6 trillion in 2023, this is according to the Insurance Regulatory Authority of Uganda (IRA) Performance Report released in 2023, reflecting an 11.29% increase year on year. Despite this progress, insurance penetration in Uganda remains relatively low. As of 2022, only about 4.5% of the population was covered by insurance.
To address this low insurance penetration, innovative distribution channels and product development have emerged as pivotal in enhancing insurance accessibility. One of the latest products to be developed is Equi-Life, spearheaded by Equity Bank Uganda and partners.
What Is Equi-Life? Equi-Life is a microinsurance offering in Uganda. It is an insurance cover tailored to provide hospital cash benefits and last expense support, ensuring peace of mind during hospitalisation and offering financial assistance for end-of-life arrangements.
The customer will be required to pay premiums on a monthly basis in order to stay covered: premium payments are made via standing order directly from the member’s equity bank account, at a premium investment cost of UGX 3,000, a quarterly investment of UGX 9,000 and an annual investment of UGX 36,000.
This policy is made active immediately after your cover start date; however, customers are eligible to claim for Hospital Cash after 48 hours and the Life benefits after the 3-month waiting period. If death or hospitalisation occurs due to an accident, the waiting period is waived, and one is eligible to claim.
The Equi-Life benefits are broken into two: A Hospital Cash Benefit of UGX 1,000,000 with UGX 50,000 per night of inpatient hospitalisation from night 2 to a maximum of 20 nights per year. This is valid for ages 18 to 75 years after hospitalisation in any accredited hospitals or inpatient facilities registered with the Uganda Ministry of Health.
The second benefit is an End of Life Cash Benefit of UGX 3,000,000, which is paid out to the member’s nominated next of kin in the event of the member’s death, whether due to natural causes, illness, or an accident. This is also valid for only ages 18 to 75 years.
Equi-Life has been made possible by three partners: Equity Bank Uganda Limited, which markets and sells the product through their agency and branch network (also known as Equi-Duuka), manages the monthly customer premium payments, and supports customers in submitting claims through their agency and branch network.
The second partner is the underwriter Liberty Life Assurance Uganda, which also supports Equi-Life marketing and sales support continuous development of engagement content and takes the lead in managing the risks insured and claims).
Finally the third partner is Turaco Microinsurance Company Ltd, which manages the tech-enabled policy admin process, manages customer support through the claims process and ensures claims are processed and paid within three working days.
For exclusions, no benefit(s) shall be payable for claims occurring due to the following: participation in political conflicts and violations of criminal law; abuse of alcohol or narcotics; self-inflicted injury and attempted suicide; any fraudulent claim; outpatient services; or admission to a hospital that is not Ministry of Health of Uganda accredited.
For hospitalisation, the required items to claim a benefit, all one needs is a copy of an ID card (front & back), a stamped discharge summary or hospital report showing date of admission and the date of discharge and treatment received.
For life benefits, the required items to claim a benefit, one needs a NIRA death certificate (proving death), a letter from a local administrative authority (if available), a police report (only for accident-related deaths), medical records (only for illness-related deaths), the claimant’s (or next of kin’s) statement, a copy of the deceased’s and next of kin’s identification documents (showing name and age/date of birth) and other documents requested as required for additional verification.
By integrating insurance offerings into its suite of financial services, Equity Bank has made insurance more accessible to its vast customer base. This strategy aligns with the industry’s broader goal of increasing insurance penetration by utilizing existing financial infrastructures to reach underserved populations.
The recent launch of Equi-Life exemplifies Equity Bank’s commitment to increasing insurance penetration in Uganda as it is designed to safeguard Uganda’s under-privileged population, often referred to as “omuntu wa bulijjo”, ensuring financial relief of 70% Ugandans earning less than $ 2 per day, thereby contributing to the overall economic growth and financial well-being of the nation.
By offering products that cater to different market segments, Equity Bank is not only enhancing financial inclusion but also fostering a culture of risk management and financial planning. This approach is crucial in a country where many individuals still perceive insurance as an unnecessary expense rather than a vital financial safeguard.