Insurance uptake in Uganda remains notably low, with less than 1 per cent of the population holding a policy.
Among millennials and Generation Z (Gen Z), the situation is even more concerning. Industry players have expressed concern about the low insurance awareness among young people. The younger generations, they say, stand to benefit the most from early adoption, as starting young often comes with the advantage of lower premiums and longer-term financial security.
Linus Batya, the chief agency officer of Jubilee Life Insurance Uganda, explains that the cost of insurance is largely influenced by age, meaning that securing a policy at a younger age is much cheaper.
“If I am starting at 29, my premium is lower than someone who is buying insurance at 40,” Batya elaborated in an interview.
Studies show that insurance uptake among the younger populations remains low in Africa, with factors like poverty, lack of product knowledge, and low-income levels contributing to this. Some of the other challenges cited include the misconception many young Ugandans have about private insurance companies.
Some, according to Batya, believe that these companies are primarily out to take their money without delivering real benefits. Batya dismisses this notion, pointing out that Uganda has a strong regulatory framework ensuring financial stability within the industry.
“The insurance sector is under strict regulation, which ensures that companies remain financially sound and accountable to policyholders,” he notes, adding that this framework is designed to protect consumers and build long-term trust in the industry.
Another reason for low insurance uptake among Millennials and Gen Z is the focus on short-term financial priorities rather than long-term security. Batya contrasts this with countries like Japan, where citizens invest in government bonds and long-term securities, not just for their generation but for future ones.
This culture has led to a remarkable insurance penetration rate, where out of every 100 citizens, 92 are insured. According to the Insurance Regulatory Authority, insurance penetration in Uganda is alarmingly low, with less than 1 per cent population insured.
Guarav believes young Ugandans should view this as an opportunity to change the trend by prioritizing insurance and increasing penetration. Beyond financial planning, lifestyle choices among younger generations make insurance even more critical.
Batya warns that an increasingly sedentary lifestyle has led to a rise in lifestyle-related diseases. Millennials and Gen Z age, they are likely to face more health complications, making life and health insurance essential for their well-being.
The younger generation, he advises, should think ahead and secure coverage before health issues arise. Insurance companies on the other hand are being urged to take proactive steps to increase uptake among young Ugandans.
Kampala-based lawyer David F. Mpanga believes the best way to drive insurance penetration beyond the current 0.8% is by focusing on younger individuals and small and medium enterprises.
He suggests that insurance firms must do more to engage and educate this demographic on the importance of coverage. Likewise, Ibrahim Kaddunabbi Lubega, CEO of the Insurance Regulatory Authority (IRA), urges insurance companies to take advantage of Bancassurance, a system that allows banks to sell insurance products.
He explains that since banks have become one-stop shops for multiple financial services, they present a convenient platform to reach young people. He believes that the IRA is open to discussions on developing solutions that specifically cater to Gen Z’s needs, ensuring that they are not left out of the insurance market.
Global trends indicate that younger generations are increasingly influencing the evolution of the insurance industry. In many markets, millennials and Gen Z prefer personalized, tech-driven insurance solutions that offer transparency and flexibility.
Research suggests that the African insurance sector is expected to grow by 6.3 per cent between 2024 and 2032, driven largely by demand from younger consumers.
