Insurance industry players have backed the implementation of stronger regulations under the new Insurance Act.
This follows a move by the Registrar of Financial Institutions to enforce key provisions of the Insurance Act of 2024.
The provisions include mandatory insurance policies, advance premium payments and tougher penalties for insurance fraud.
In a written response, Insurance Association of Malawi (IAM) President Dorothy Chapeyama described the implementation as a significant step towards building a stronger and more resilient insurance sector.
“We support measures that strengthen regulation, enhance consumer protection, improve risk management and promote confidence in the insurance sector,” Chapeyama said.
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The new Act requires premiums to be paid before an insurance policy becomes effective, except for certain life insurance policies.
Under the new Act, any person convicted of insurance fraud faces a fine of K100 million or three times the amount defrauded, whichever is higher, and imprisonment for up to 10 years.
Chapeyama said the stiffer penalties sent a strong deterrent message and demonstrated the regulator’s commitment to protecting the integrity of the sector.
Economist Marvin Banda backed the tightening of insurance regulations, saying the reforms would improve efficiency and financial stability within the sector.
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He described the introduction of mandatory insurance for public buildings and construction projects as long overdue.
“The real challenge is enforcement and restoring public trust. Many Malawians remain uninsured not because insurance is unavailable but because they perceive it as expensive and doubt that claims will be paid promptly and fairly,” he added.
In a statement dated May 29 2026, the Registrar of Financial Institutions said the Insurance Act, which came into effect on May 1 2025, replaced the Insurance Act of 2010 and the 12-month transitional period for compliance expired on May 1 this year.
The new law also introduces mandatory insurance for contractors registered with the National Construction Industry Council to cover risks such as bodily injury, death and property damage during construction projects.
