‘Zimbabweans Prepare More for Death Than Life’: Old Mutual
Zimbabweans prepare more for death than life with 76% of all insurance taken being funeral policies, Old Mutual Zimbabwe Group CEO, Samuel Matsekete has said.
The uptake of life policies is low and the figures are taken from the Insurance and Pensions Commision (IPEC) report of 2019.
Matsekete was speaking at the Great Zimbabwe University (GZU) Vice Chancellor’s Invitational Public Lecture Series on Friday last week.
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He also said that apart from funeral policies, there is also a tendency for people to take medical aid which means that they are more cognisant of long life and death.
“When you look at statistics, you see that people spend more in medical aid and the reason is they want to live longer but they skip the savings to take care of themselves as they live longer and jump that phase to prepare for death. They want to be well, and they are preparing very well for that then they want to know that they will be buried decently,” said Matsekete.
He emphasised the importance of savings from individual level to national level adding that long term savings and insurance are a critical part of sustainable economic development.
“We must promote a culture of savings through private or domestic arrangements, broad based aggregated savings arrangements, promoting capital market such as public listings, and the issuance of other securities for specific projects is part of enabling long term savings because then assets that can generate returns are visible and accessible to those that are saving. They can make choices and decisions and can optimise their savings,” said Matsekete. The theme of Matsekete’s presentation was “Long term savings, insurance and infrastructural development of Zimbabwe”.
“One of the risks that people will always be aware of is death. In our insurance sector today, in the life premiums when we analyse them, we actually see that there is more funeral premium provision than life which means that we prepare more for this event called death than we do for living longer,” said Matsekete.
Insurance and Pensions Commission (IPEC) Public Relations Manager, Lloyd Gumbo said, according to the 2019 IPEC Baseline Survey on Insurance and Pensions Awareness and Uptake, about 76% of the people with insurance, had funeral policies.
He attributed it to the defined benefit characteristics of funeral assurance products and that funeral premiums are relatively cheaper compared to life assurance products.
“This high uptake of funeral policies could be attributed to the defined benefit characteristics of funeral assurance products where people with valid policies receive services such as bus, hearse, and the actual burial of the deceased.
“The other factor could be that funeral premiums are relatively cheaper compared to other life assurance products,” said Gumbo.
Old Mutual Managing Director-Life Assurance, Rutendo Magorimbo said on the risk side, there is more funeral and short term products rather than savings. MasvingoMirror
