Minister of Finance Calle Schlettwein says insurance firms should work with their governments to leverage the conducive policy environment and address supply-side bottlenecks.
The minister said in the context of Africa, the need to roll out micro-insurance with products and services tailor-made to the needs of the under-served segments of the population must be emphasised, taking into account the circumstances of each country.
The minister made the appeal during the official opening of the 39th Annual Conference of the Organisation of Eastern and Southern African Insurers that started at Swakopmund on Monday.
The three-day conference was attended by 39 insurance representatives from Asia, North America, Africa, Australia and Europe and was hosted under the theme: ‘The future of the Insurance Industry in Emerging African Countries’.
In Namibia, the minister noted that access to insurance products continues to lag behind the rest of the world and the cost of much-needed products is often out of the range for low-income earners.
“Recent initiatives requiring banks to offer a basic account for low earners and mandating the removal of cash deposit fees for individuals should be emulated to help improve financial inclusion in Namibia,” stated Schlettwein.
He said by extending insurance products to the marginalised section of the population, Africans can rightfully talk about financial inclusion.
“The sub-Saharan African region has some work to do to improve access to financial services. In 2014 only 34 percent of adults in our region had an account at a financial institution, compared with a world average of 62 percent.
“Sub-Saharan African economic growth is now facing strong headwinds stemming from a slump in commodity prices and adverse development in major export markets,” he stated. “However, Africa with its large young population, may hold the key to global growth prospects for the future,” Schlettwein said.
He noted that any company that wants to survive and grow over the next couple of decades should be looking to invest in Africa. Given that financial inclusion remains relatively low on the continent, there is tremendous long-term growth potential in sectors, such as the insurance industry.