Chairman Jimmy Longbut, Board directors of BSP Life, invited guests, ladies and gentlemen.
I would like to acknowledge and thank BSP Life board and management for the invitation to officiate at the launching of this new product- ‘Wantok Delite’. This launching marks a significant progress for BSP Life since its licencing in 2018, culminating with the introduction of this new long term product that not only will provide life insurance cover but will also provide an alternative investment opportunity as an additional benefit to prospective life insurance policy holders. This in general helps to promote the insurance agenda in PNG.
Our attendance is in line with the Bank of PNG’s Financial Inclusion Agenda where inclusive insurance is one of the key priority areas under the National Financial Inclusion Strategy 2016-2020. Life insurance and insurance in general as you may be aware are not very well known types of financial products to our general population, most of whom live in the rural areas. As a result, insurance products are the least sought after, compared to savings and loans or banking products. A small segment of our country’s population understand the importance of an insurance product and the benefits such product can provide to anyone who acquires it to protect oneself from an event of disaster or misfortunes.
Insurance services are important elements in when it comes to risk management so I encourage the public to talk to the appropriate people at BSP Life or other insurance companies to obtain accurate information about their usefulness. In other countries, e.g. like our closes neighbour, Fiji, the majority of the population has some form of access to insurance products and services. Unfortunately, in PNG, insurance coverage is estimated to be around 2-3% and is mainly in the formal sector. Insurance services for the informal sector and also for rural areas are almost non-existent. This market segment, which comprises around 85% of the workforce of the country, is still untapped for insurance service. Hence, the objective for the Inclusive Working Group for 2016-2020 Financial Inclusion Strategy is to reach about 1.5 million insurance policy holders by end of this year through various activities such as awareness, education, innovative products and various distribution channels using Fintech.
Though the target seems daunting, I believe its attainable and the launching of this BSP Life endowment product is timely and in line with the above objective and overall financial inclusion initiatives. This product, from the Bank of PNG’s view, has the potential to increase the uptake of policyholders and broaden the coverage of the life insurance in the market due to its cash benefits which will provide an incentive for prospective policy holders compared to the current term life products offered by the industry.
Insurance is all about building trust and confidence of our people. The challenge for BSP Life and the insurance market players is to ensure adequate awareness and education on the importance of insurance are provided in simplified and easy to read materials and in other forms for the public to have access to. Hence this challenge and responsibility lays with BSP Life to ensure that its vast Agent network right across Port Moresby and in Lae do proper awareness and training about product benefits, risks coverage and so forth.
In facilitating the financial inclusion agenda, the Bank of PNG continues to promote an enabling environment, e.g. through its licensing powers and in line with government policies to ensure our people have access to a wide range of financial services and products to choose from in order to enhance their standard of living.
The Bank of PNG expects that those entrusted with the responsibility of looking after insurance policyholders’ funds continue to act in a prudent manner at all times and BSP Life is of no exception, it must at all times comply with the Banks regulations, the standards, and best business practices.
At this juncture, I would like to Congratulate BSP Life Board and the Management for the launching of this important life insurance product for our willing public. I would also like to extend my congratulations to Mr Robin Fleming and the BSP Group for taking the strategic step to establish BSP Life in PNG which indicates the confidence, the demand and room for more players in the Life insurance and insurance in general.
Thank you.