Short-term insurance healthy and growing

THE short-term insurance industry in Namibia are facing various challenges, mostly notably the volatility of the local currency against the US dollar which makes imported car parts expensive and will subsequently lead to costly accident vehicle repairs.

Despite this the industry is financially sound with an average solvency rate of 32 per cent, Lily Brandt, Acting Chief Executive Officer of the Namibia Financial Institution Supervisory Authority (Namfisa), said at the launch of Alexander Forbes Insurance Company.Gross premiums have doubled over the last five years and from 2007 to 2008 grew by 23 per cent, she said, adding that the sector contributes nearly two per cent to the gross domestic product.’The challenging environment is not necessarily one of doom and gloom, since it brings immense opportunity as business transforms itself to become more cost effective and customer centric. This will see more relevant and highly competitive offerings to the market, which will bring short-term insurance spend back to the Namibian household’s essential shopping list,’ Brandt said.Currently the per capita spending on short-term insurance is about N$550 a month. This is high in relation to that of South Africa, but one has to bear in mind Namibia’s extremely high income disparities, which have a ‘massive impact on uptake’, Brandt said.Namibia currently has 14 registered short-term insurers, including specialist and niche insurers, as well as the country’s re-insurer. There are also 415 intermediaries.

In an age of information overload, Sunrise is The Namibian’s morning briefing, delivered at 6h00 from Monday to Friday. It offers a curated rundown of the most important stories from the past 24 hours – occasionally with a light, witty touch. It’s an essential way to stay informed. Subscribe and join our newsletter community.

The Namibian uses AI tools to assist with improved quality, accuracy and efficiency, while maintaining editorial oversight and journalistic integrity.