New leadership at IAAT Promises Transformation For Tanzania’s Insurance Sector

By Adonis Byemelwa

The Insurance Agents Association of Tanzania (IAAT) recently held its fifth annual general meeting (AGM) on October 24, 2024, marking a pivotal moment in the organization's history with significant leadership changes and a renewed focus on the future of insurance in the country. Lugano Mkisi was elected as the new chairman, decisively defeating the incumbent, John Sayi Daudi, the transition signals a new direction for the IAAT, as it seeks to address numerous challenges that have plagued the industry.

The AGM brought to light many issues regarding Daudi's leadership. Delegates expressed dissatisfaction over a lack of transparency and ineffective governance during his tenure. Concerns were raised about outdated operational systems, with members criticizing the use of antiquated methods that hindered the growth and efficiency of the association.

During the meeting, there was a notable incident where Sayi failed to provide a detailed financial breakdown when questioned. Instead, he instructed members to submit formal requests for such information, a move that astonished many attendees who expected immediate answers.

In addition to governance issues, members voiced frustration over low commission rates, which have been a long-standing concern among insurance agents. Instead of addressing these grievances, the Insurance Commissioner unexpectedly issued a circular reducing commission rates, further inflaming tensions within the association.

This decision was met with outrage as agents felt unrepresented and unsupported by their leadership. Many lamented that the previous administration had failed to adequately advocate for their rights, prompting the need for a fresh approach.

The election process for the new leadership was not without its controversies. The outgoing administration attempted to dismiss the elected election committee, aiming to impose electronic voting procedures rather than adhering to the traditional paper ballot system.

This maneuver raised eyebrows among members, who viewed it as an attempt to manipulate the electoral process. Fortunately, the Registrar of Societies and the Insurance Commissioner intervened, restoring the committee's authority to oversee the election, and ensuring a fair and transparent process.

Upon taking office, new chairman Lugano Mkisi committed to implementing meaningful changes within the IAAT. He has laid out a vision focused on several key areas, including advocating for members' rights, driving digital transformation, ensuring financial sustainability, and enhancing transparency and accountability. Mkisi highlighted the necessity of constitutional and policy reforms to better serve the interests of the association’s members and the broader insurance industry.

With a solid background in the insurance sector, Mkisi brings 14 years of experience in various leadership roles. His impressive track record includes positions such as Underwriting Manager, Marketing Manager, and Principal Officer. Additionally, he has served as a part-time lecturer in insurance and risk management at the Institute of Finance Management (IFM). His comprehensive understanding of the industry, coupled with his commitment to ethical practices, instills confidence among IAAT members, many of whom believe that his leadership will revitalize the association and address long-standing challenges.

The importance of the insurance sector in Tanzania cannot be overstated. As a critical component of the economy, insurance provides essential coverage and financial protection to individuals and businesses alike.

However, the industry faces numerous challenges, including low penetration rates, limited public awareness, and inadequate access to insurance products. According to a 2021 report from the Insurance Regulatory Authority of Tanzania, the insurance penetration rate in Tanzania was only around 1.1%, which is significantly lower than the global average of 7.23%. This highlights the urgent need for reforms and initiatives to boost the sector's growth and efficacy.

Insurance experts in Africa have long emphasized the need for the industry to adapt to the changing landscape. Notable figures such as Dr. J. Olufemi Afolabi, a respected insurance consultant and educator, have called for the modernization of insurance practices across the continent

He advocates for the integration of technology in operations to enhance efficiency and reach underserved populations. Additionally, Tanzanian insurance guru Dr. Haji Semboja has pointed out the necessity of strengthening regulatory frameworks to protect consumers and foster a healthier market environment.

The new leadership under Mkisi is poised to address these issues and work toward elevating the insurance industry in Tanzania. One of his primary goals is to increase awareness and understanding of insurance products among the general population, thus fostering a culture of risk management.

He also aims to improve the commission structure for agents, ensuring that they are fairly compensated for their efforts, which is crucial for motivating agents and retaining talent within the industry.

As Mkisi embarks on this new journey, he has a clear mandate to transform the IAAT into a more dynamic and effective organization that champions the interests of its members. By focusing on advocacy, digital transformation, and ethical governance, the IAAT can play a crucial role in elevating the insurance industry in Tanzania.

Many members and industry stakeholders are optimistic that under Mkisi's leadership, the IAAT will emerge stronger and more resilient, capable of meeting the challenges of an ever-evolving marketplace and enhancing the overall economic landscape of the nation.

The changes within the IAAT signal a new chapter for insurance agents in Tanzania. With a leader like Lugano Mkisi at the helm, there is hope for a revitalized association that prioritizes the rights and interests of its members while contributing to the broader goals of improving insurance accessibility and effectiveness across the country. The time for change is now, and the future of the insurance industry in Tanzania looks promising.