If you are a business leader or enthusiast of the insurance sector in Africa, you will know that driving insurance penetration is of great concern in the industry. Only South Africa currently boasts of a double-digit penetration; 13.4-16.99% penetration, as reported by different studies 2015-2020.
Depending on who you asked, several factors like poverty, regulation and religion are high up the list usually on why there’s a low penetration rate of insurance in Africa.
Suppose the insurance industry continues to struggle with the adoption of insurance. In that case, the continent will miss out on protecting its people from financial loss and organisations from taking their rightful place in the scheme driving economic growth because, according to a study by Deloitte, up to 33% of the premium insurance volume will come from brand new propositions by 2024.
At Octamile, we believe that technology, data and product redesign of services and products in the insurance sector can play a considerable role in insurance penetration.
We hosted three professionals (Ekerete Ola Gam-Ikon, CEO of Finterate Projects, Omotola Sotade – Director of Insurance and Giga llori – Director of Partnerships and Strategy) to discuss the challenges and solutions to insurance penetration in Africa.
We kicked off the session by learning what our panellists thought were the biggest challenges of Driving Insurance Penetration Across Africa?
In Giga, Ilori felt that most Sub-Sharan Africa is developing and has a high poverty level. People are not placing the suitable amount of value on insurance as they should.
Some of it comes from the thinking that “insurance is for rich people”. It has created a wrong view of insurance, but regardless, “insurance is important for the poor and the rich”. A re-education of Africa’s people on what insurance is, why it is essential, and its value proposition is key to Africa’s people.
“Insurance companies need to rethink technology and make it technology people already use.”Giga Ilori
The CEO of Finterate Projects, Ekerete Ola Gam-Ikon, suggested that communication has played one of the most significant roles in low insurance penetration in Nigeria and Africa.
For example, there is low awareness of trends and truths in the insurance sector. There is a false belief among many consumers in Nigeria and professionals that “insurers dont settle claims”. Whereas across the continent, billions are paid yearly across Nigeria and Africa. However, there’s no clear communication to drive a change in such narratives in the mind of consumers.
The entire panellist session on driving insurance penetration is now available on-demand via zoom; click here to watch it now and use Octamile#2 for the access passcode.