Insurance: The Great Protector

• Industry Leaders On The Virtues Of Preparing For The Worst
  

The Insurance Association of Sri Lanka (IASL) designated May 5 as ‘Insurance Awareness Creation Day’, with the objective of increasing awareness on insurance and building confidence amongst all stakeholders.
Speaking to The Sunday Leader were many of the industry’s leading figures who in their own words hailed the awareness campaign as the start to bigger market penetration in life insurance and more importantly, wider protection across the nation.
Sri Lanka has a longstanding history in insurance dating back to British colonial times.
President, IASL, Ramal Jasinghe stated, “Life insurance has not always been perceived positively or for that matter understood correctly by the general public when compared with other financial services in the market. We hope to change that with this awareness campaign”.
Immediate Past President, IASL, HNB Assurance Managing Director Manjula de Silva explained that the awareness campaign is spread across 54 locations island-wide, reaching as far as Jaffna and Batticaloa and that so far, the response has been positive.
De Silva said, “We’re happy with the response and this is for the betterment of the industry and will be an ongoing project throughout the year.”
Meanwhile the Insurance Ombudsman, Dr. Wickrama Weerasooria, too has expressed his appreciation regarding the effort put together by the member companies and the IASL in this endeavor stating that this was a long overdue need where the importance of insurance is brought out in the open for the public to be exposed to the numerous benefits of insurance.
Vice President, IASL, Prakash Schafter said, “Insurance is occasionally looked upon as an expense by the public. In reality however, it is a unique form of protection against risk of death or disability. This campaign will enlighten people on the role played by insurance to fulfill a dire social need that people previously were blind to until they were faced with it.”
On the economic impact of insurance, Secretary, IASL, Deepthi Lokuarachchi stated that apart from distributing some 200,000 leaflets, the programmes were aimed at highlighting the benefits of insurance rather than each company’s individual products.
Lokuarachchi drew from the Japanese example stating, “In Japan, 99.9 of the population is insured and this lessens the burden on the state and social organisations. Families do stay stable when disaster strikes, as we witnessed with the recent tsunami.”
Lokuarachchi also used housing in the country as a clear example. He said, “Regardless of what class, anyone building or purchasing a house spends a considerable amount of their funds and when natural disasters strike, or accidents like fires take place they could lose everything or take a very big financial blow, a blow that insurance can prevent. But unfortunately Sri Lankans are not in the habit of saving for disasters or emergencies.”
And hence, an industry with a low market penetration (10.9% of the entire population signed up for a life insurance policy; 1.3% of the GDP of the country.)
Secretary General, Upali Samarasinghe was of the opinion that insurance should take precedence in one’s priorities even over banking.
Samarasinghe said, “Everyone needs a life insurance cover regardless of what assets they have but many are of the view that insurance takes more than it gives back, one of the main roles of this campaign is to explain in detail, clauses and expectations of a life insurance policy.”
The IASL’s campaign will emphasize why a prospective customer should sign up with an insurance cover, be it a general or a life insurance solution, and how the other additional benefits/or perils could be used to design the appropriate solution for the respective customer depending on their individual needs.
“Insurance customers are often unable to understand the policy in detail and hence come across various problems at the time of a claim. The IASL campaign will draw the attention of the public to the single and most important principal of insurance which is ‘Uberrimae Fidei’, which translates to ‘utmost good faith’. The general public will be informed of the importance of providing accurate and reliable information when opting for a life or general insurance policy. We will also draw attention to the gray areas which are often misunderstood by customers when signing up for an insurance policy and applying for a claim”, said Treasurer IASL, Dirk Pereira.