24 Sep 2023

 Botswana Life Insurance Holdings Limited (BIHL) has embarked on a journey of transformation and collaboration to understand the magnitude of the Insurance Protection Gap (IPG) in the country.

The move will also suggest relevant interventions and mitigation measures to address its challenges.

Giving a keynote address during the Botswana Life Insurance Symposium 2023, recently, Non-Bank Financial Institutions Regulatory Authority CEO, Mr Oduetse Motshidisi commended BIHL for initiating an insightful engagement to explore the existence of IPG.

Mr Motshidisi said the inaugural symposium themed; Understanding and Addressing the Insurance Protection Gap, would help to understand the nature, form, cause and impact of IPG in Botswana, in order to craft and tailor-make suitable interventions for the local market. The symposium was meant to provide an opportunity for the advancement of the insurance industry and to drive positive change in ensuring that no one is left exposed to undue risks due to the inadequate insurance coverage.

In his welcome remarks, Botswana Life CEO, Mr Ronald Samuels, said the symposium presented a unique opportunity to shape a future where accessible insurance protection empowered a nation with financial security and peace of mind and laid a foundation for a world where no individual or business faced vulnerability due to inadequate knowledge of IPG.

The event, Mr Samuels said also served as a beckon of hope to acknowledge and understand the significance of the challenge that lay ahead. Insurance Protection Gap, Mr Samuels said represented the critical issue within the insurance industry, highlighting the disparity between optimal insurance coverage needed and the actual coverage that individuals and businesses procured.

“Too often we witness a lack of awareness and it has catastrophic results, leading to individuals and companies underestimating the risks they face. 

This gap is a stock reminder of the vulnerabilities that individuals and entities face when unforeseen events or life events happen,” he said

Mr Samuels said statistics, locally and internationally, echoed the gravity of IPG, adding that in Botswana a growing number of businesses found themselves underinsured, which put their financial wellbeing and security at utmost risk.

“According to the 2023 World Bank Data statistics, the IPG in Botswana stands at a staggering 47 per cent - revealing a critical need to bridge the gap and ensure that our community is adequately safe guarded against uncertainties,” he added.

However, Botswana Life CEO said through proper advice to customers, brokers and financial advisers could play a critical part in bridging this gap.

Therefore, in fostering progress, he said the gender disparity that accompanied IPG should not be overlooked, particularly in the low and middle income countries, as addressing the gap required a comprehensive approach to uplift all segments of the society and ensure that women had equal access and essential financial protection.

Mr Samuels said leaders in the insurance sector had a collective responsibility to raise awareness and educate clients about the paramount importance of adequate insurance.

Still at the event, a panel of experts, facilitated by BIHL Group COO Mr Johannes van Schalkwyk, also shed light on the IPG and how it affected individuals and businesses, as well as how to cultivate a culture of financial literacy. ends