Liquidity problems hit insurance sector

THE Insurers Association of Zambia says due to tight liquidity in the market, paying premiums has become a challenge for most players in the sector.
Meanwhile, the association hopes to provide insurance cover to over six million Zambians by 2019.
IAZ president Shipango Muteto said insurance is usually at the bottom list when it comes to priority spending by entities and individuals.
Mr Muteto said during the IAZ conference dubbed “Nurturing growth in turbulent times” that there is need to find solutions that will address challenges in the sector if service providers in the industry are to remain relevant to their customers.
“Liquidity in the market is really tight resulting in delayed settlement and premiums with debt ratios of 52 percent in the last three years that are most likely to hit 60 percent in 2016,” Mr Muteto said.
He said collecting premiums has been a challenge due to hard economic times, resulting in a rise in the cost of claims and sums insured.
And speaking when she officiated at the conference, permanent secretary for budget and economic affairs in the Ministry of Finance Pamela Kabamba said Government will continue implementing friendly policies to boost growth in the insurance sector.
Mrs Kabamba, however, said there is need for the sector to ensure that more people have access to affordable products.
She said Kabamba it is important to provide quality services that the public can willingly insure without any form of persuasion as they will be able to witness the value.

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