Liberty Life Assurance Uganda
Company Profile and History
Liberty Life is a multinational life insurance company which was established in 1957. It listed on the JSE in 1962. It established a presence in Uganda in 2008 and in its first year wrote premiums worth over Ush2.5 billion (US$1.42 million), just a couple of thousands less than top life premiums writers, Insurance Company of East Africa that raked in Ush2.51 billion (US$1.43 million). Prior to Liberty’s entry in Uganda, life insurance business was dominated by the former parastatal National Insurance Corporation, Insurance Company of East Africa, Jubilee Insurance and East African Underwriters.
In Country Location
3rd Floor Garden City, Yusuf Lulu Rd, Kampala, Uganda; Tel: +256 414 233794/254708; Fax: +256 414 232903
Services and Products
Liberty Life Assurance Uganda provides life assurance, credit-life business, funeral policies, disability benefit and dread disease cover
Number of Employees
The table below summarises the statutory capital requirement for each of the group’s insurance companies and the available capital held on the statutory basis
Currently Liberty Life is the only firm operating in the market offering only life insurance business.
“To transform Liberty into the leading wealth management company in Africa and other select emerging markets”
In 2007 the executive management team of Liberty were given a mandate by the board to increase the focus on growth and to build a broader wealth company. At the heart of the business proposition is the customer and the ability to gather and manage customers’ assets as effectively and cheaply as possible. Underpinning the gathering and management of assets is the group’s three manager model which splits the origination and management of assets into three categories: Liability generation: The process of liability origination, i.e. the sale of the group’s product range, encompassing insurance, health services and asset management (the liability origination responsibility includes managing reputational risk as well as the resultant financial obligation); A strategic balance sheet management capability: Separate and independent management of market, credit and liquidity risks arising from liability generation activities; and Asset management capability: Focused management of the group and customer assets to maximise returns within mandate and risk appetite.
The liabilities are originated and assets are gathered primarily through a consolidated marketing, sales and distribution platform which leverages the group’s tied sales force and maximises mutually beneficial arrangements with partners such as Standard Bank. Measuring delivery of strategy Liberty measures the delivery of the agreed strategy at three distinct levels throughout the group: Business as usual: The ability to optimise current business processes through a focus on continuous improvement and efficiency; Leverage and build: The opportunity to extract additional value from the existing customer base and product offering; and Extend and grow: The creation of additional wealth solutions and extension of the customer base through product manufacturing, geographic and strategic partnership expansion.
The charts below summarise each of the delivery levels’ primary objectives and managements’ 2008 self assessment of these.
Ownership of Business
Liberty Group bought a 51 percent share in Liberty Life Assurance, Uganda.
Benefits Offered and Relations with Government
The Uganda Insurance Commission (UIC) regulates the insurance industry. Some of the regulations are as follows: The Principal Officer of the insurer the agent is to represent has to sign a Certificate of Competency that the said agent is acceptable as a representative of his company and that if issued with a licence he/she is: duly authorized to secure proposals and to collect moneys by way of premiums for an on behalf of the insurance company, competent to explain: the conditions of the policies issued by the company, the meanings of questions asked in the proposal forms issued by the company; before a firm may file an application for licensing, it has to fill a registration form, available at the Uganda Insurance Commission, and pay a registration fee of Shs.100,000; paid-up share capital (local or foreign) of not less than: Shs.1,000,000,000/=, in case of life or non-life insurance business and Shs.2,500,000,000/=, in case of reinsurance business; establish and maintain, at the Bank of Uganda a security deposit of at least 10% of the prescribed paid-up capital of the company, indicating the amount paid and the date of payment; once the application is approved, a licence fee of Shs.200,000/= is payable.
On 27 May 2008, Standard Bank announced that it would make an offer to shareholders to acquire the issued ordinary shares in Liberty Holdings Limited which it did not already hold. This offer was accepted overwhelmingly by shareholders and the transaction proceeded. On 1 December 2008, Liberty Holdings Limited acquired the shares not already owned in Liberty Group Limited through a share swop arrangement. Standard Bank retained a 53, 65% ownership of Liberty. Significant benefits will flow from this structure, which allows for more efficient utilisation of capital.
In Uganda in 2008 Liberty Health took over the administration of UgaMed’s comprehensive medical insurance. UgaMed’s offering houses a wide range of health covers in a single package. Launched in May 2007 by leading Ugandan insurance group East African Underwriters Ltd (EAU), UgaMed already has a membership base of 6 000, with growth of 100 percent projected over the next 18 months.