By BUUMBA CHIMBULU
INSURANCE is a necessary investment, rather than an extra expense as it allows business owners to run companies without worrying about unexpected events that can slow down their operations.
Local businesses must therefore include insurance in their financial plans as risk management is a key factor in sustaining a successful business, says the Pensions and Insurance Authority (PIA).
P I A Communications Manager Doreen Silungwe, said insurance was important in risk m a n a g e m e n t and business sustainability.
“ B u s i n e s s owners need to understand that insurance is a necessary investment, rather than an extra expense as it allows business owners to run companies without having to worry about unexpected events that can slow down businesses or bring them to a complete halt when unexpected risks such as accidents, fire and theft occur,” Ms Silungwe said in a statement issued in Lusaka.She expressed regret that most local businesses, especially small and medium enterprises did not understand the importance of insurance while others still held negative perceptions towards insurance.
On insurance uptake, she said the PIA had noted with delight that non-traditional categories of insurance such as property and life are now increasingly contributing to the growth of the market.
Ms Silungwe also reiterated the importance of pensions and insurance in facilitating economic development by contributing to building a strong financial market.
She said the financial sector which has three arms, namely, banking, capital markets and pensions and insurance, has an independent relationship to have a functional financial market.“For example, through insurance, banks are able to issue loans to customers knowing that any potential risk is covered by the insurer. Pension schemes also play a role in the development of the capital markets through investments of pension contributions,” Ms Silungwe said.She also said the pension scheme and insurance companies play an important role in supporting sustainable economic development.
This article is supported with the WAN IFRA Women In News (WIN) Social Impact Reporting Initiative (SIRI). Gender equality, diversity and inclusion ( GEDI) Information in this article does not reflect the views of WAN IFRA Women In News.
