IASL increases awareness of insurance benefits throughout Insurance Month

The Insurance Association of Sri Lanka (IASL) annually celebrates Insurance Month throughout September. Here, IASL President and Amana Takaful PLC Life Insurance CEO Gehan Rajapaksa shares his thoughts on post-pandemic developments in the industry:

Q: September being Insurance Month, what is IASL’s role this year? 

 Since its inception, Insurance Day and Insurance Month have been coordinated and conducted as an initiative of IASL with the participation of its member companies. This year too it is the same but on a scaled down level due to the impact of COVID-19. 

IASL President Gehan Rajapaksa

Ideally all insurance service providing companies visit different towns across the island to spread awareness on insurance and its advantages among the general public. However, as a responsible industry, a decision was made to not have these activities that require social gathering. Hence, it has been limited to a media based awareness campaign.

This year’s Insurance Day, which was held for the fourth consecutive year was a virtual event to raise insurance awareness. However, each company will have its own activities that will be carried out throughout the month of September. Public Relations (PR) and digital tools will be used to create awareness.

The Government declared 1 September as National Insurance Day in 2017, which was a significant milestone for the industry. Since then the day has been marked each year with a series of events across the country organised by the Marketing and Sales Forum (MSF) – IASL. Activations in the past years took place in Colombo, Kandy, Kurunegala, Jaffna, Ratnapura, Anuradhapura and Matara hosted by the insurance industry players. The day’s events were marked also with the presence of insurance advisors of companies who helped in raising awareness.

The National Insurance Day declaration is expected to help increase the sector’s contribution to the GDP of the country, and has helped reduce dependency on the Government to provide relief and compensation to victims of natural catastrophes.

Q: How has the COVID-19 lockdown impacted the insurance industry, in terms of both life and general insurance? 

 Both the life and general insurance businesses were adversely impacted with no turnover. Needless to say that in such circumstances it is obvious that the impact was very significant, particularly on the cash flow of the companies. 

With regard to the life business, the companies had to sustain the advisors with income support since they were unable to go out and collect premiums or generate new sales. Cash flow of the general insurance sector too was impacted negatively. However, from a claims perspective there was a positive outcome as the number of accidents reported and resulting claims were minimal. 

Together with the regulators office – the Insurance Regulatory Commission of Sri Lanka (IRCSL) the industry too played its part in coming forward to grant relief to our customers with offering 3 month’s grace period to pay premiums. 

Q: With this situation, what challenges or issues do you see at present?

 The months of June and July have seen a reasonable recovery in the industry. However, the negative economic outlook resulting from the lockdown will have a negative impact on disposable income, thus putting strain in the level of new business growth that can be generated. Further, lapsation could also arise as an issue for the life industry as customers are unable to continue premium payments. Overall the industry is closely linked to the expansion of the economy and its growth will depend on it too. We do not see any particular challenges arising from the pandemic per se. 

Q: What developments would you like to see at the end of the Insurance Month sales and marketing activities? 

 Given the circumstances of low activation and economic down turn, we would not like to assess the month’s success in terms of sales activities. Due to these unavoidable conditions Insurance Month will be considered more as an awareness month. 

Q: As a whole, what measures has IASL taken in terms of protecting the lives of the general public? Have you offered any facilities to customers during the COVID-19 lockdown? 

 As mentioned before, the industry came forward to offer all our clients a relief of three months’ grace period to pay their premiums, keeping all those policies live and liable to pay any claims that arose. The insurance industry has always been a rock solid one that has come forward to shoulder the responsibility of protecting the insured public. This time was no different and the industry continued to offer the level of protection that was offered under normal circumstances with no difference. 

At the same time, the insurance sector representatives have been emphasising on the need to provide comprehensive protection for all lives and assets. Industry experts note the current increase in life expectancy shows us that people are becoming more health conscious, which is also being advocated by the insurance industry.

Level of disposable income and negative perceptions on insurance and social security benefits have negatively impacted the growth of the insurance sector over the years. This is the key concern that we as IASL continuously want to address, and show the general public the importance as well as the benefits that they gain when they are insured.