Tuesday, December 7, 2021

Public knowledge about insurance minimal

The oddity of it is striking: a majority of Batswana know an awful lot about the church and yet when the Societies Amendment Bill was to be tabled before parliament, extensive consultation was undertaken. On the other hand, despite the fact that those same people know precious little about the insurance business, they were not consulted when the Insurance Industry Bill was tabled.

Last week when parliament debated the insurance bill, Francistown South MP, Wynter Mmolotsi raised the concern that this process was taking place when a majority of Batswana are in the dark about the intricacies of insurance.

“I believe that Batswana should fully understand this insurance business which is why I would have been very happy if the Minister of Finance and Development Planning had undertaken what is called extensive consultation. Today when you go to rural areas, people don’t know anything about this Insurance Industry Bill. In Francistown we have three constituencies and the minister can’t say, ‘I went to Francistown and met with residents to hear their views on this bill,” said Mmolotsi, adding that it was insufficient for the minister to say he had consulted stakeholders when he was only referring to insurance companies.

As an indication, perhaps, of how average people have been completely shut out of the debate, MPs who debated the issue in Setswana couldn’t find the indigenous-language equivalent for “insurance”. That prompted the Assistant Minister of Education and Skills Development, Master Goya, to ask the Deputy Speaker, Kagiso Molatlhegi, if he could recommend a Setswana word for “insurance”. The latter’s response was that he would look for a Setswana dictionary at the University of Botswana that would provide the required answer.

When he responded to MPs’ comments, Minister Kenneth Matambo agreed that indeed many Batswana have limited knowledge about the insurance business.

“Public education is going to be very, very important. We shall charge the [Non-Banking Financial Institutions Regulatory Authority] to deal with that task. In fact, I should say that I know NBFIRA has already started; there are some radio programmes conducted by NBFIRA. One day I was driving around town and listening to that programme on Radio Botswana and I learnt a lot. I believe that if I can learn from that public education by NBFIRA, many others can also learn,” Matambo said.

Stressing another dimension of citizen empowerment in the insurance industry, Gaborone Bonnington South MP, Ndaba Gaolathe, said it was important for more Batswana to own insurance companies.

“It is a source of great concern that there are not enough citizens in this very important sector which has been identified as one of the engines for future economic growth in Botswana. I think it is not unreasonable to propose that in line with the idea of aligning with Botswana’s aspiration to empower its own citizens to become torch bearers in different disciplines and sectors and in this case in the insurance sector, there has to be a provision which forces insurers and investors to work with or to include citizens as shareholders,” Gaolathe said.
He recommended that 10 percent shareholding must be reserved for citizens.

“I know a lot of people might say that may scare away potential foreign investors, that your suggestion of a minimum of 10 percent might portray you, your party or parliament or this country as being anti-foreign investor friendly. I think far from it, there is a reasonable understanding globally, around the world that it has become increasingly important for citizens in individual countries to participate. This can only enhance the success, the profitability and the sustainability of these businesses in which these foreign investors would have invested in,” the MP said.

RELATED STORIES

Read this week's paper