ZIMBABWE’S insurance industry says government should review levies and taxes on insurance products to make them affordable.
The issue of high taxes came under the spotlight during the insurance sector’s conference in Victoria Falls on Monday, after a Finance ministry official said the high cost of insurance products was affecting the growth of the industry.
Matthew Sangu, the deputy director for financial sector policy in the ministry, blamed low uptake of insurance to high cost of insurance policies.
Sangu, who was delivering keynote remarks at the Insurance Institute of Zimbabwe annual conference, said consumers were finding insurance too expensive.
“Formal insurance remained low. This is attributed to high cost of insurance and lack of knowledge,” Sangu said.
But delegates argued that the cost of bringing an insurance product to the end user were high because of high taxes, levies and other regulatory obligations. Insurance Council of Zimbabwe chairperson of the public relations committee, David Nyabadza was among the speakers at the conference.
He said: “Costs in terms delivering the insurance product itself are very high.”
“On a typical policy we have to collect levies to fund the regulator, we have to collect stamp duty, we have to collect for some of the other regulatory entities like the Traffic Safety Council and we also have to pay intermediary tax on it,” he said.
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“I totally agree that there has been of lack of education about our products and services. We have a lot of publicity and outreach and we are working on this with the regulators. When you look at funeral (policy), the uptake of the product is higher than all the other classes.
“That is because funeral is very relevant to people, maybe we should look at other products to see if they are relevant to people. I know that our rates are low but I think it also has to do with insurance products themselves.”
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