National Insurance Company (NIC) has partnered with National Microfinance Bank (NMB) to simplify and maximise collection of insurance premium.NIC agents underwrite a big number of life premiums but were facing some hurdles using an old method of stop orders to employers that instruct them to deduct premiums from employees’ salaries.
But since most employees are paid through banks, the stop order method, though still effective, faced challenges in this era of dotcom generation.
The NIC Director of Marketing and Customer Services, Mr Henry Machoke, said the partnership will enable NIC to deduct direct premium payment from a policy holder’s account at NMB.
“We (NIC) have been losing premium deductions and business as well in the last two years,” Mr Machoke said, “this has reduced NIC and our agents’ revenues.”
NIC data shows that life premium collection has dwindled by 6.0 per cent from 874m/- in January 2014 to 820m/- in December.
The once leading general and life insurance firm targeted to collect 1bn/- for life portfolio in 2014, instead saw revenue falling further away from the goal.
To address the issue NIC called some 40 life agents to chart a business strategy for this year while looking at past obstacles before putting a way forward plan.
However, the NMB partnership came at the wake of the government regulations that an employee should not be deducted below a one-third of total salary.
NIC’s Director for Life Insurance and Pension Ms Rose Lawa said the deduction is between NIC and clients as some life policies could be purchased at a minimum amount of money but are of great importance to be ignored.
“Basically we (NIC and agents) are financial advisors, we can still advise the basics of life premium, which are affordable to a purchaser, even if the buyer has other money obligations,” Ms Lawa said.
The Director for Life Insurance said, “we can still compete while cooperating” to create a win-win stance for the insurer and agencies.
Before the sector was liberalized in mid-1990s, NIC was sole insurance firm in Tanzania mainland. But over time its market share has dropped to below 30 per cent.
Source: Daily News, reported by Abduel Elinaza from Dar es Salaam, Tanzania
0 comments :
Post a Comment