Thursday, October 28, 2021

Another local insurance outfit gives it a shot at industry giants

When she hosted financial journalists at the Bona Life offices in the capital Gaborone recently, Chief Executive Regina Sikalesele Vaka expressed her wish to see a home grown financial services company thriving.

In her words, “My vision is to prove that even in our country, it is possible to start and operate a citizen owned financial services company that thrives”.

Vaka was responding to allegations that some of the Bona Life wanted her out of the company. By her own admission, there are irreconcilable differences which have resulted in negative publicity towards the country’s first citizen owned Life Insurance Company.

While Vaka battles to save the soul of “her baby”, another industry captain, Tiny Kgatlwane is also pursuing similar interest of increasing citizen participation and ownership in the insurance industry. 

Currently the majority of key insurance companies, insurance brokerages and even agencies are largely foreign owned.

Kgatlwane was formerly with BIFM ÔÇô a subsidiary of insurance giant Botswana Insurance Holdings Limited (BIHL) which is listed at the Botswana Stock Exchange and is largely owned and controlled by South African company ÔÇô Sanlam. Kgatlwane was shown the door as Chief Executive Officer of BIFM in February 2015 and went on to be named as the first executive director of First Sun Alliance Insurance Brokers.

This week Kgatlwane told Sunday Standard that an opportunity for Botswana owned professional firms to participate in the insurance space has presented itself.

She cautions that this citizen participation requires commitment from government, particularly government owned entities to support the development of such companies.

As a result, Kgatlwane has since positioned Kgare Insurance Brokers with a strategy that will strengthen the key pillars, namely service provision, people development, enhance customer experience and trust, and come up with targeted product solutions for clients’ needs.

Some of the challenges that the newly branded Kgare faces in the insurance space is the reduction in margins as a result of a price war in the market.

The other challenge Kgatlwane mentioned is the, confidence building from major market customers, “some believe that only internationally owned organizations can provide good quality service. To address the challenges, we are focusing on differentiating our products and service approach, building on new and existing client relationships and improving our clients’ awareness on how insurance works for their benefit.”

She went onto add that, a number of customers, do not fully appreciate the value of insurance and when under financial pressure they are quick to cancel or cut down on their insurance costs. As a result, a lot of customers especially SMME’s and individuals find themselves overly exposed when an accident or disaster occurs.

A lot of education/sensitization is still required to enhance customer knowledge on the benefits of insurance, she said.

Kgare transition period commenced in April 2016 until recently. During this period, First sun insurance brokers became a majority citizen owned entity and guided by the legal and regulatory framework of Botswana, a Board decision was taken to rebrand to Kgare Insurance brokers, a name both befitting of purpose and the new ownership, according to the company chairman Tebatso Lekalake. 

Kgatlwane could not be drawn into divulging the costs related to the transition, was first announced the new executive director effective 31st March 2016 before the Kgare transition period commenced.

She was then appointed Managing Director of Kgare effective from March 1st 2018, taking over from Paul Chitate, a Zimbabwean national who is the Founder.

Chitate founded First Sun Alliance in 1999 and in April 2016, its shareholding was diversified to include citizens who now hold majority share of 51 percent. These citizen majority shareholders are Tiny Kgatlwane, Tebatso Lekalake, Keneilwe Mere and Kgaotsang Matthews.

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