The Insurance Regulatory Authority of Uganda has given the green light for AAR General Insurance Uganda Limited to write non-life business in the country, formalising a move the AAR Group has long telegraphed: a strategic shift from being primarily a dominant health membership organisation.
The approval, which comes amid a year of intense supervisory change and an industry reset, places AAR squarely in a non-life sector that is large, concentrated and claims-intensive, and in which incumbents were already spending heavily mid-year to defend and expand market share.
AAR’s entry is not being attempted from scratch. The IRA’s market report shows AAR Health Services (U) Limited as the clear leader in the HMO segment.
HMOs posted an approximate UGX 70 billion in gross written premiums in 2024, and AAR accounted for the majority of that HMO business.
The IRA’s charts show AAR with roughly 67% of the HMO market share, with 2024 revenue noted as UGX 45 billion.
Those assets form a deep corporate client base, a working claims operation and a widely recognised brand, which explains in part why the regulator considered the group suitable to hold a non-life licence.
Entering a competitive non-life market
Yet the non-life market AAR is stepping into is materially different. Across the industry, total gross written premiums for the year were UGX 1.77 trillion.
Of that aggregate, non-life accounted for UGX 986 billion, approximately 55.9% of total industry GWP, while life business contributed UGX 702 billion, and microinsurance and other classes made up the remainder.
The industry also paid out heavy claims: the IRA’s consolidated gross claims figure for 2024 is UGX 887.5 billion, a reminder that non-life underwriting is frequency- and severity-driven and that the balance-sheet risks are real.
The IRA’s 2024 report also documents the competitive structure that AAR will face.
The non-life market is concentrated: the top three non-life insurers hold close to 41% of the market premium, and the top five account for roughly 58%. Old Mutual, Sanlam General, Jubilee, Britam and ICEA Lion General are named among the largest non-life incumbents.
Their scale is supported by entrenched broker networks, bancassurance arrangements and treaty reinsurance panels. Against that backdrop, winning corporate and retail non-life customers, rather than merely competing for them, will require a precise blend of distribution deals, underwriting discipline and reinsurance capacity.
A snapshot of mid-year market behaviour underscores how fiercely incumbents defend market share.
IRA lists corporate awareness and market-development spend, showing the top five spenders were Sanlam General (UGX 263 million), ICEA Lion General (UGX 184 million), Jubilee Life (UGX 105 million), Liberty General (UGX 60 million) and Old Mutual Life (UGX 40 million).
The allocations reveal that non-life incumbents were investing aggressively in visibility and distribution in the middle of last year, while life companies were also investing to support group, bancassurance and cross-sell ambitions.
Tribunal Backs URA in UGX 10.2 Billion Century Bottling Tax FightFor AAR, whose natural route to scale includes cross-selling to HMO clients, this is a reminder that distribution reach and marketing discipline must be accompanied by operational readiness.
Commercially, AAR will confront several concrete hurdles. Non-life underwriting is claims-intensive: motor and health/medical were among the largest revenue drivers in 2024.
Motor revenue alone is shown in the IRA class-wise breakdown at UGX 190 billion, and these lines carry high loss and expense ratios.
The IRA’s loss and expense tables show elevated loss experience in several non-life classes, signalling that any entrant must be able to control frequency, price for severity and manage expense.
Distribution is a second challenge: market concentration gives incumbents advantages in broker and bancassurance channels and in corporate accounts; AAR’s HMO relationships remain a competitive asset, but converting those relationships into profitable motor, property and liability portfolios requires product engineering, aligned incentives and close partnerships with brokers and banks.
Third, reinsurance capacity is decisive: the IRA emphasises cession patterns and the role of reinsurers, and large property or engineering risks, and the expected growth in oil and gas coverage, will require treaty and facultative placements that protect the insurer’s balance sheet.
Fourth, the operational and fraud landscape matters: the IRA’s fraud register lists 23 suspected cases in 2024, with a total value of UGX 1.2 billion, with motor and forgery prominent.
That experience underscores the need for automated claims workflows, digital evidence capture and anti-fraud analytics.
Regulatory hurdles add another layer of discipline.
The IRA’s 2024 report restates minimum paid-up capital rules and the new supervisory posture under IFRS 17.
The regulatory minimum for a non-life insurer remains UGX 6 billion paid-up capital; at the same time, IRA’s adoption of IFRS 17 and the subsequent amendments to capital and prudential regulations mean IFRS 17’s measurement of insurance contracts now feeds into risk-based assessments and capital calculations.
The Authority also stepped up risk-based supervision, deploying supervisory technology and carrying out a broad programme of on-site inspections: the report records 316 inspections across branches, agencies and targeted reviews in 2024.
These measures make clear that new entrants will face continuous reporting, frequent supervisory interaction and the expectation of high governance and market-conduct standards.
The IRA’s work on data and technology regulation, complaints handling, anti-money laundering, and other new instruments further elevates the compliance costs and operational sophistication required of a modern insurer.
