Zambia’s Microinsurance Landscape: 2012 Survey

Financed by FinMark Trust and the International Labour Organization?s (ILO?s) Microinsurance Innovation Facility, the 2012 microinsurance landscape survey was commissioned by the Microinsurance Technical Advisory Group (TAG) and Pensions and Insurance Authority (PIA). The survey was designed to provide information on the current status of microinsurance business in Zambia as well give some indication to potential success drivers and barriers to growth. This focus note summarises the key findings of this survey.

Top-line results

  • There are currently 5 active long-term insurers engaged in microinsurance business
  • Life plans providing funeral cover dominate microinsurance business
  • A total of 213,181 lives are covered by life plans offered by 5 long-term insurers, as at December 2012
  • Credit life to low-income people accounts for 121,474 policyholders
  • Lack of experience, low understanding of insurance and lack of trust in insurance companies emerged as key demand side constraints
  • Lack of market intelligence on the low-income market, inadequate capacity, low experience, risk aversion and inclination towards quick returns on investments emerged as key supply side constraints
  • The majority of insurers are optimistic about the growth of microinsurance business in Zambia
  • A few insurers are pessimistic about microinsurance growth, highlighting the need for widespread investments in consumer education as well as willingness of insurers to invest in microinsurance business
  • Identified supplier capacity building needs included product development, distribution, sale force management, marketing, and client value and claims management