NBFIRA calls for affordable annuity products

An annuity is an insurance product in which someone invests a lump sum or a series of payments and is then paid out regular disbursements at fixed intervals usually during retirement. The call came at the back of the results of a market survey that the regulator conducted in March 2017 to understand the structure and growth patterns of annuities in the country. According to the regulator, there are two categories of annuities, being deferred annuities and immediate annuities. “These could either be fixed, fixed-indexed or variable type,” said NBFIRA.

The survey found that life insurers and some retirement funds in Botswana provide annuities, which are forms of insurance or investment entitling the investor to a series of annual sums. NBFIRA said over the past three years, annuities have been within top three products for life insurance gross written premium (GWP) and have contributed 25-26% of GWP for life insurers.