
Radar | Nov 27,2021
Oct 23 , 2021
By BERSABEH GEBRE ( FORTUNE STAFF WRITER )
Awash Insurance S.C. plans to start a clinical-trial coverage policy, submitted its proposal to the insurance supervision directorate at the National Bank of Ethiopia (NBE) last month.
If permitted, Awash will be the second insurance firm following the Ethiopian Insurance Corporation (EIC), the state-owned industry giant. Industry insiders see diversifying products as key to growth in the industry characterised by cut-throat price competition and low penetration of insurance policies.
A clinical-trail insurance policy provides coverage for participants of clinical trials, who are compensated for risking injury, disease or death in controlled studies and researches. Awash has been preparing its policy for nearly a month, setting a goal to generate up to 15 million Br in annual premiums, says Gudissa Legesse, CEO of Awash Insurance. It is five times higher than the target set by EIC from a similar product. Gudissa saw the firm's gross written premiums surpassing one billion Birr last year, the first among 17 private insurers, with over 30 life and non-life insurance products.
"The coverage will help researchers save on foreign currency," said the CEO, who expects no underwriting profit during the first year.
The 26-year old firm focused on research centres such as the Armauer Hansen Research Institute, the Addis Abeba University College of Health Sciences, the Ethiopian Public Health Institute and public universities.
"Researchers have asked us to introduce this policy many times," Gudissa told Fortune.
Clinical trials conducted in Ethiopia buy insurance coverage from firms abroad, where policies cost up to 14,000 euros.
Abebaw Fekadu is a professor of psychiatry at Addis Abeba University and director of the Africa Centre of Excellence for Innovative Drug Development & Therapeutic Trials. He believes the policy could help researchers cut down on forex expenditures but would have other benefits. The low risk involved for insurance firms, as the health and safety of participants is a priority in any clinical trial, could encourage them to offer the product, according to Abebaw.
"Insurance is crucial to fostering clinical trials and research," he said.
Awash, which registered 210 million Br in profits last year, does not plan to involve a reinsurer in its clinical trial policy, says Gudissa.
"The market is not big," he said.
The clinical trial policy is the second product Awash Insurance is introducing this year after offering mobile phone insurance coverage. Other firms say clinical trial policies are not worth their effort, as there is no market for them.
Founded in 1995, Nyala Insurance, which also launched a mobile phone insurance policy earlier this year, is one such firm. Yared Molla, CEO of Nyala, believes that although there have been requests from research institutions, the company has no plans to get into the business.
"The firm will focus on policies that have more demand," said Yared.
In countries like Ethiopia, where there is a low-resource setting, conducting a clinical trial is expensive and financed by funders and international agencies such as the World Health Organisation (WHO).
The lack of expanding market is attributed to insufficient marketing, according to Fikru Tsegye, executive officer for strategy and business development at Ethiopian Reinsurance (EthioRe).
"New policies could collapse if the public has no awareness," said Fikru.
PUBLISHED ON
Oct 23,2021 [ VOL
22 , NO
1121]
Radar | Nov 27,2021
Radar | Jan 18,2020
Radar | May 23,2021
Fortune News | Aug 03,2019
Fortune News | Mar 07,2020
Radar | Apr 08,2023
Fortune News | Nov 29,2020
Radar | Jan 19,2019
Radar | Jun 14,2020
Covid-19 | Jun 12,2021
Dec 24 , 2022
Biniam Mikru heads the department of cabinet affairs under Mayor Adanech Abiebie. But...
Jul 2 , 2022 . By RUTH TAYE
On a rainy afternoon last week, a coffee processing facility in the capital's Akaki-Qality District was abuzz with activ...
Nov 27 , 2021
Against my will, I have witnessed the most terrible defeat of reason and the most sa...
Nov 13 , 2021
Plans and reality do not always gel. They rarely do in a fast-moving world. Every act...
Dec 2 , 2023
The symphony of traffic noise in Addis Abeba is not just a sign of life, but a siren...
Nov 25 , 2023
Ethiopia's quest to develop a functioning capital market is a demanding yet not unach...
Nov 18 , 2023
Prime Minister Abiy Ahmed (PhD) has made a fervent call for landlocked Ethiopia to ga...
Nov 11 , 2023
In November last year, a ray of hope pierced the gloomy skies of Ethiopia as the Pret...