Equity Bank Group to Launch Insurance Services in Uganda

Equity Group has announced plans to establish an insurance business in Uganda. This development is part of a larger strategy to expand its insurance operations across four countries where it already has banking subsidiaries. The move follows successful insurance operations in Kenya and a pilot program in the Democratic Republic of Congo (DRC).

Expansion Plan

Equity Group’s plan includes creating a holding company to manage four subsidiaries. These subsidiaries will handle different aspects of the group’s operations: banking, insurance, technology, and a foundation. The group aims to leverage the knowledge gained from the DRC pilot program to roll out insurance services in Uganda, Tanzania, South Sudan, and Rwanda.

Table 1: Equity Group’s Subsidiaries and Functions

Existing Operations

Equity Group already operates life insurance services in Kenya, with over 11.5 million policies as of May 2024. The pilot program in DRC, which began in March 2024, involves distributing risk products through a local partnership. This initiative is expected to provide valuable insights for expanding the insurance business in other regional markets starting in 2025.

Angela Okinda, the Managing Director and Principal Officer of Equity Life Assurance, highlighted the importance of the DRC pilot during the annual general meeting on June 26. “Through a local partnership in the DRC, we have started distributing risk products. As we progress, you will see more from a footprint perspective in other regional markets in 2025 and beyond,” she said.

Strategic Diversification

Equity Group currently operates banking subsidiaries in Kenya, Uganda, Tanzania, South Sudan, Rwanda, and DRC. The expansion into the insurance market is part of the group’s strategy to diversify its operations. Shareholders have approved the incorporation of a health insurance subsidiary, which will first operate in Kenya before expanding to other regions.

While details on the timeline for launching the insurance business in Uganda are not yet available, the group is keen to tap into Uganda’s growing insurance sector. Despite economic challenges, Uganda’s insurance market has shown resilience and growth. Insurance written premiums increased by 11.13% from Shs1.44 trillion in December 2022 to Shs1.6 trillion in December 2023.

Bancassurance to Direct Insurance

Currently, banks in Uganda primarily sell insurance products through bancassurance. However, Equity Group’s plan to form a dedicated insurance subsidiary means it will directly operate its insurance business, providing a wider range of insurance products and services.

Equity Group’s first insurance subsidiary was established in March 2022 to offer life products. By the end of the first quarter of that year, it had amassed Shs596.5 billion (Ksh20.8 billion) in total assets and achieved a pre-tax profit of Shs9.2 billion (Ksh321 million), marking a 106% increase from the previous year.

Future Prospects

The entry of Equity Group into Uganda’s insurance market is expected to enhance competition and offer more options to consumers. With its extensive experience and successful pilot programs, Equity Group is well-positioned to make a significant impact on the region’s insurance landscape.

For further details or comments, Equity Bank Uganda’s Communications Manager, Ms. Barbara Among, was unavailable at the time of reporting.

Table 2: Equity Group’s Financial Highlights (March 2022)

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