Why should Tanzanians take insurance a necessary tool to them

Speaking to The Guardian in an exclusive interview in Dar es Salaam over the weekend during a ceremony organised by MGen Insurance Company to recognize contributions rendered to the company by their intermediaries insurance agencies and brokers, MGen Insurance Tanzania Company, Managing Director Charles Sumbwe said “Insurance is the backbone of all these developments in the country.

He said all these infrastructures, like roads, and bridges, among others, depended on the insurance if something went wrong contractors would not have to worry for there will be somebody who would pay for the loss they would incurred.

He said that insurance is like a tool to everybody, to individuals and businesses. “If you insure your businesses you will be able to do your businesses with peace of mind and freely without fear,” he noted.

Sumbwe urged the public to venture and take risk decisions because if they do so and something goes wrong is someone who is going to come in and help them to pay for the losses incurred.

He mentioned some of the advantages of insurance as, it gives an insurer the ability to be able to go about with his business without worry, and not to worry about what would happen in the event that he loses properties.

People would factorise if the factory goes up in fire. What do you do next, where do you get the money to put up a new factory. But if you have paid a small premium and you have an insurer behind you.

The insurer would come in and indemnify you to reinstate, to repair or to even pay you cash money to go on with your business as usual. “So, that is the main, advantage of having an insurance,” he insisted.

Commenting on the achievements MGen Insurance Company has done in Tanzania since its initiation in Tanzania for the last nine years ago, Sumbwe said his insurance company works in general insurance sector and some of their achievements have been their continued to survive and to excel in their services.

“We have got a good clean record, also good record in meeting regulatory requirements that is a great achievement,” he boasted.

Regarding the status of the insurance sector in the country, Sumbwe said “It is difficult to categorise what is the status. There are specific areas that we need to talk about-but as an insurance company, one of the things that we really need to see is the ability for people to pay their premiums.”

He further noted “You know insurance companies are like any other business and we need to build our finances in order to satisfy the needs of our clients.

So, one of the things, I think is a problem is that premium delaying in coming , I think that is something that the public needs to be educated about,” he explained.

Unlike some other insurance companies that are being blamed for delaying paying loss claims of their clients, he said his company pays their claims within the regulatory period.

“I think it is the generalisation of the public that insurance companies did not pay their loss claims timely.”
He said there were many factors that can make insurance companies delay to pay timely or refuse to pay altogether.

The first major reason is that sometimes the claimers do not produce the necessary documents that are required.

And then the day they bring the document they say now pay me. “That is not the way to do business. There are many things that lead to those situations,” he said.

“We ourselves, we follow our claims very vigorously and we pay valid claims that are well presented, we pay them within the required regulatory period.”

Some of the challenges that have been facing the insurance companies in the country are such as delayed premium payments. He said some people do not pay their premiums timely; saying that is an issue that needed to be addressed.

He said education awareness on the importance of people to join insurance and pay their premiums timely was vital and inevitable for the development of the sector. “People should know that if they don’t pay timely, there would be also delays in their claims payment-and some of them might not be paid at all,” he warned.

Another challenge is the VAT issue. “VAT is a very good thing we don’t argue about it, but if the general public is not aware of how it should go about, and if we don’t receive premiums in time, how can we remit the VAT that is required.”

He noted that in reality VAT has increased the costs of insurance, but that is not their problem. “VAT is VAT, it is part of the law everybody has to pay VAT. Those are some of the burning issues,” he noted.

As an insurance company, he said that they will ensure they carry out an education awareness to the public to enable it understand what is insurance all about. “Insurance is not something for people to use, to try and make money out of it, but rather it is about putting in a situation where you were before the loss. It is not an individual to make profit out of it.

“We want to compensate you to indemnify you, to put you back in your origin position. So that is, what insurance is.”
He commended the insurance regulatory authority for doing a good work. “If there is any issue that needs to be addressed to the government we will channel through the right channel, which is the regulator,” he noted.

Meanwhile, MGen Insurance Company boss has urged their current and prospective clients to trust them, saying they were proud for being a service, customer oriented company. “We listen to our customers, we try to meet their needs and ensure that their expectations are met; adding we have got a team that is well trained ready to provide different types of covers, to look out your specific needs, so that your needs can be met,” he boated.

During that occasion MGen Insurance Company awarded certificates of recognition to their intermediaries for their contributions they have rendered to the company. “These achievements could not have been attained without the support of our intermediaries,” the MD acknowledged.

“We acknowledge the performance of some of our intermediaries for meeting our achievements according to the specification we had set out,” he explained.

Those who were awarded were brokers and agents for their contributions to premiums and the best performance in terms of claims performance and also the best intermediaries at remitting premiums in accordance with the regulatory framework.

“These are important things because it is a delicate matter of quality of business and cash flow that will ascertain our continuity in business,” he said.

MGen’s head of marketing Shangwa, in the first category of loss ratio category the award was presented to Five Star Insurance Agency for their quality of business in 2015. While the best loss ratio award to brokers was presented to FED Insurance Broker.