Sri Lanka's top five general insurance providers which command two thirds of the market share, have failed to issue insurance policies for certain products in Sinhala and Tamil, a recent research study shows.
The problem of a weak English literacy level in parts of the country exposes regional and rural businesses to potential exploitation by unscrupulous insurance agents selling policies worded only in English.
The research study conducted by Verité Research has found out that resolving the language gap will help SMEs island-wide when it comes to natural disaster insurance in Sri Lanka, reports Lanka Business Online
Some SME owners who were affected by the May 2017 floods in the Ratnapura district, believed that they had purchased natural disaster insurance through agents representing private insurers. However, they realised later that they had been misinformed by the agents only after the disaster, when they attempted to claim on their policy, Verite Research said. The insurance contracts had been exclusively in English.”
“Generally, these agents are not direct employees of insurance companies,” Verite Research highlighted.
The Insurance Regulatory Commission of Sri Lanka states that it has not set out any rules on the languages to be used on insurance documents, unlike in banking where regulations stipulate that all licensed commercial banks have to spell out terms and conditions of banking products and services in the customer's preferred language.