Life Insurance Perspective Among Tanzanian Community

By Christopher Mwamulenga 

From the perspective of many Tanzanians life insurance is not a necessity with exception to elites and small communities that have good exposure to advantages of financial services. According to the Tanzania Insurance Regulatory Authority (TIRA) life insurance has grown by 5.6% and 8.6% in the year 2017 and 2018 respectively. Although the growth rate is good but there are few reasons that still hinder the progress of life insurance in Tanzania. TIRA identifies them as follows:

• Majority see insurance as an unnecessary commodity due to lack of knowledge and low income capacity.

• International standards and terms that do not fit our local environment.

• Distribution expenses of  insurance products that raise insurance expenses to both insures and consumers.

To overcome this, an intellectual, moral and social guidance should be accessible to all levels of community. Evidence from our vast experience in the financial services industry suggests the need to change people’s perception on life insurance  for the betterment of current and future generation.

For instance, when considering other insurance products such as non-life insurance there is a better understanding of them compared to life insurance products. A contributing factor among others is that most non-life insurance such as motor and health insurance are forced by law and receive significant  enforcement by the government.

Life insurance is essential for achieving  stable life, high living standards and improved social welfare in the community. To achieve this, life insurance companies have a huge role to play especially in filling the knowledge gap that exists regarding life insurance.  

Overcoming this situation, insurance companies are currently taking various measures such as raising public awareness through face to face persuasion, radio, television programs, digital/electronic technologies, news papers’ blogs and others. These measures are taken to change the public perception on life insurance services. For instance, BUMACO Life Insurance raises the public awareness on life insurance through a weekly program at Kicheko Radio Station and on its social media pages on instagram and twitter. 

Life insurance is about life planning and it's for everyone in the community regardless of their financial status. Life insurance has different products depending on the risk that they want to insure. It gives the consumer the choice of selecting  the amount of benefits, time of insurance cover, amounts of premiums, means and modes of payment. In addition, life insurance provides a mechanism for target saving. Life insurance as an instrument for progress can help an individual or family to plan for education, retirement, and generational wealth transfer. Furthermore, Life planning is essential for provision and caring for dependants and loved one especially in instances of unexpected death.

The author of this blog entry has 15 years of   experience as a financial services practitioner in Tanzania.