INTERVIEW: Setting a standard in Insurance

Paul Kavuma is the deputy managing director of Goldstar Insurance Company Ltd. He spoke to Agnes E. Nantaba about their operations in particular and the insurance industry in general.

What are the key elements in your management style as a manager?

I believe in creating an environment of trust and mutual respect. And of course team playing and leading by example in the execution of tasks to cut across the board regardless of the hierarchy. This, in my opinion, instills discipline and nurtures a good work ethic.

Goldstar Insurance was recently awarded ISO certification. What does this mean to you as a company?

ISO certification provides us with a platform to lay claim to compliance with quality services benchmarked on international standards. Ours is a services industry where we literally sell a promise to our clients. So the certification is synonymous with our core values to include customer care and satisfaction as well as prompt service delivery coupled with our long-standing philosophy of sustainable growth. The natural attraction to us is ensuring that we provide a service beyond expectations that will also generate referrals for new business and most importantly client retention.

What is your assessment of the performance of the insurance industry in Uganda currently?

The industry has exhibited remarkable signs of growth in terms of production, human resource capital development, and supervision especially by the Insurance Regulatory Authority of Uganda (IRA-U), which is robust. Dynamism in the industry’s associations such as Uganda Insurers Association (UIA) has created more awareness. These have thus greatly contributed to continued growth and confidence in the insuring public on one hand and the advent of investments in the in-frame of new entrants into the market on the other. We have also seen a remarkable improvement in peer confidence and loyalty through the sharing of risks amongst ourselves.

It is now 20 years since GoldStar launched operations in Uganda. What are your key achievements?

To say that Goldstar Insurance has grown leaps and bounds would be an understatement. The long-standing philosophy of the promoters’ right from its incorporation had in mind a vision to create a sustainable growth path for the company, and no doubt this has been achieved. Goldstar has maintained and consolidated its market share over the years as a large indigenous Ugandan insurance company amidst a number of regional players with associated advantages. This philosophy has over the years crystallized into a strong financial base incomparable in the market using the financial ratios as good benchmarks. Our association and partnership with world-renowned travel insurance providers AXA is a clear testimony of brand confidence and growth.

What are the major challenges facing the insurance industry in Uganda?

The challenges that the overall economy faces do not spare the insurance industry. The erratic nature of the foreign exchange rate, perceived unfavorable legislation like inclusion of VAT on insurance services all make the cost of acquisition high and prohibitive and where acquired it generates high receivables for uncollected premiums. The hardness of the economy has also exposed the industry to an accelerated and alarming statistic of fraud; insurance is now seen as the next vulnerable sector to perpetrate fraud.

What is your strategy towards solving the challenges to remain relevant in the insurance market?

As an industry we need to create mass production of the service at the micro level. Insurance should be seen as a vehicle for risk transfer for all businesses and also as a life style for individuals.

What opportunities can the players in the insurance market explore to increase the product portfolio in the market, which remains limited?

With the performance of the industry and the gaps within, mass production is the way to go. It is a proper outreach to the business community in clusters of their respective affiliations to business and creates tailor-made products to suit their budgets and risks.

The insurance industry is notorious for its poor settlement of claims. What is your take on that?

We are a heavily-regulated industry with quarterly submission of returns to the regulator. This in very many ways keeps the insurers in check and also ensures that we remain relevant. The notion that claims settlement is poor may be a thing of the past because no insurer worth their salt can afford to upset a client through either a delayed or sloppy claims process. The insuring public is advised to make use of the complaints bureau at IRA-U in the event of any justified disgruntlement regarding insurance matters and claims in particular. And also exercise objectiveness whilst being critical at all times, claims are denied for justified reasons rather than proverbial fine print excuse by some insurers.

What is your projection of Goldstar’s success in the next few years?

We uphold the philosophy of sustainable growth, with a good underwriting practice and excellent service, which is very much achievable. Product innovations, re-packaging and enhancements are a must and a continuous process. Like earlier mentioned, mass market products are the way to go and who knows a regional partner as a strategy cannot be overlooked, once we get the perfect fit and buy.