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Partner with financially stable reinsurers, RBM advises

The Reserve Bank of Malawi (RBM) has urged local insurance companies to partner with financially stable reinsurers to counter challenges arising from settling big claims.

RBM spokesperson Mbane Ngwira, in an interview on Friday, said this in the context of a claim for K192.4 million which Prime Insurance Company Limited settled with Kalikuti Hotel in Lilongwe.

Ngwira: Settle claims
Ngwira: Settle claimsch

He said it is encouraging that some local insurance companies are able to settle substantial claims within a short space of time.

“Even though insurance companies get premiums from their customers, it is important to work with reinsurers that are financially-stable if big claims are to be settled without hitches. The settlement of the K192.4 million claim by Prime Insurance is a good development which will inspire confidence in clients,” he said.

Ngwira said insurance companies that take time or fail to settle clients’ claims should be reported to RBM, as a regulator, and appropriate action will be taken.

“We do not want insurance companies that get premiums and fail to pay their clients in times of accidents,” he said.

James Kateka, chief executive officer of Canopy Insurance, Kalikuti Hotel brokers, said they were happy that their client has received the claim, which is one of the biggest in the history of the country.

“With the devaluation of the kwacha, the money might not be enough to complete the reconstruction exercise of the hotel, but it is the biggest claim we have handled as brokers.

“Malawians must make sure they insure their valued properties so that they are indemnified in times of accidents,” he said.

Figures show that Malawi has one of the lowest insurance penetration in Africa as well as in the whole world standing at a paltry three percent.

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