Pipo Insuretech

01/11/2022

MTN, Sanlam set to disrupt Africa insurance ahead of Safaricom

Steve Mbogo



Sanlam and MTN Group have today signed a deal to start selling digital insurance and investment products across Africa a move set to narrow the wide gap of uninsured population and assets.

The deal was confirmed by the heads of the two pan-African companies in a statement issued in Johannesburg South Africa on Tuesday.

“This alliance will establish a digital insurance and investment capability across Africa,” said MTN Group President and CEO Ralph Mupita.

Sanlam has a direct and footprint presence in 32 African markets. MTN is Africa's largest mobile network operator with 272m customers.

The two companies are seeking to leverage their customers numbers, geographical reach and partnerships to benefit from the huge untapped African insurance market.

“Our strategic alliance to market and distribute insurance and investment products across Africa has reached a significant milestone with the fulfillment of the regulatory, competition and other requirements. The effective date of the transaction is 31 October 2022,” the two South Africa-headquartered companies said.

The strategic alliance will be implemented through MTN Group’s InsurTech platform aYo Holdings (aYo) and each partner will hold 50% of aYo.

Through aYo, the alliance will continue to build and develop digital insurance and investment offerings that provide people across Africa with easier access to Sanlam’s products, particularly those people who have typically been unable to access traditional distribution channels.

Insurance in Africa has been termed a ‘sleeping giant’ because of the huge potential to scale.

According to the Africa Reinsurance Corporation , the continent's insurance pe*******on averages 2.8%, considerably below the world's average of 6.3%, highlighting Africa's potential.

It is expected that whichever company gets it right with insuretech in Africa on the numbers of the massive uninsured population will win fintech market in the continent.

Paul Hanratty, the Sanlam Group CEO termed the deal as “a critical stage in our drive to deepen pe*******on of insurance and investment products across Africa through strategic partnerships.”

In March this year, reported that MTN Group’s mobile money product, MoMo had overtaken Kenya’s ’s equivalent Mpesa in capitalization to become the biggest in Africa.

Now, this new strategic alliance amy further deepen MTN’s fintech market share in Africa as it comes ahead of the planned launch of and Mali - digitally enabled insuretech and investment products respectively.

Ends

01/11/2022

21/10/2022

Without cover, are you really a farmer?

Steve Mbogo

In 2014, a teacher in area of decided to create a new income stream by investing in to sell at a profit. The venture was successful until months before the planned sale for December festive holidays, when all the nine bulls suddenly died.


The cause? The farm worker unknowingly fed the bulls a poisonous w**d. The teacher had invested Ksh150,000 in the construction of the cattle shed and Ksh180,000 to buy nine bull calves. Other unspecified money went into buying feed and labour costs.


She expected to sell each fattened bull for at least Ksh90,000 to make a gross income of Ksh810,000 after two years. But disaster struck. She was staring at zero income and a negative spend of over Ksh450,000. But it was not to be thanks to .


🧵What distinguished the two losses is that the teacher had insured her bulls against accidental death but the Facebook member of the group had not insured her cow.

So the teacher was compensated for the loss of the bulls and the lost income to the tune of Ksh900,000 which she used to reinvest in new bull calves. For the Facebook member, the only option left is to find new money to replace the dead cow.

Why the value of is immeasurable

Livestock insurance matters because according to the Kenya Dairy Board, increased from 591.4 million litres in 2017 to 801.9 million litres in 2021.

This shows that many Kenyans are increasingly taking as a business. There is demonstrated evidence that dairy farming has become a major contributor to household income hence the need to secure it against unexpected risks.

There are tens of insurance companies that offer livestock insurance in Kenya. All the farmer needs to do is to call an insurance company of choice or visit one that is nearest you, or a preferred agent for that matter.

Overall, key features of livestock insurance include the following;
Covers dairy and beef cattle of 2 months to 10 years. Sheep, goats and pigs of 2 months to 7 years among others. Please check with your preferred insurance company or agent.

The minimum cover for livestock insurance is usually Ksh2,000 per animal per year. However, the more animals one insures the lower the cost. Again, your insurance company or agent are best placed to advise you because these prices are negotiated and are unique depending on the risk profile of your livestock.

Some of the risks covered include; death resulting from lightning, internal and external injuries, windstorms, snake bites, electrocution or flooding and various diseases.

Covers also include emergency slaughter based on the advice of a qualified veterinary officer, theft, loss of income benefit, and drought among others.

As noted, please speak to your chosen insurance company or preferred agent to provide you will specifics of based on the risk profile of your livestock assets. 🐄

10/10/2022

A glance at some of products for in ?

Compiled by

Successive studies have revealed that small businesses in Kenya rarely use insurance as a form of risk mitigation.

Yet this category of entrepreneurs is at a high risk of being wiped out of business in case of a tragedy like fire, flooding, theft, online fraud among others.

There are several factors leading to failure by to take insurance cover. They include;
Where the enterprise owner thinks the business is too small to qualify for insurance. Examples include a , a -based business (cottage industry), business located in an open air market etc.
There is on benefits of -mitigation among many small scale business owners.
Many small business owners think that .
Others opt for to prevent .
 have not invested enough to on , and .

Small business owners - and here we are talking from the micro to medium scale - must know that # insurance is a critical business tool that they should use to that form the biggest to their business.

This in a nutshell is to ensure that in case of a tragedy that knocks out your business, your have a to return the business to its former status.

will help an enterprise do the following;
Restore previous stock levels.
Rebuild premises.
Pay for injuries sustained by either business owner, employee or a 3rd party during the tragedy.
Ensure business continuity without raising new capital from loans and/or savings.
Give freedom of mind to the business owner.
Prevent the business owner from getting poor and continue creating wealth and job opportunities.

Our graphics show the range of insurance products available for SMEs in Kenya. The list is not exhaustive.

There are companies that offer bundled business insurance policies that cover a range of risks. For example, BizBora by ICEA Lion combines seven business insurance products and provides a chance to tailor the product to a business needs.
Stanbic Bank has a product known as SME BizSure Insurance Plan that eliminates the need to take out individual policies to cover different facets of your business

Old Mutual has BiasharaSure Cover that offer benefits from different classes of insurance such as burglary, all-risk and combined liability.

07/10/2022

Planning ahead for your family is the greatest show of LOVE.
Insurance lets you express it. Buy your , and any other that will help them cope with tomorrow's .

07/10/2022

https://youtu.be/C_NxuwQTFEI

This video defines insurance and then explains with an example of how insurance works in plain and simple English with very few technical terms. This video c...

04/10/2022

How fits into your plan



When you have saved some money, nothing compares to peace of mind knowing that you have a back-up in case of an emergency.

Not only is saved money likely to be readily available, it is free such that you do not have to pay an interest on it.

Tapping your means you avoid the embarrassment of borrowing from family and friends and certainly the risk exposure of getting it from a .

There are many ways to save money and one of them is by buying a policy.

Life is defined as a between you and an company where you commit to paying a certain amount of premium and the company commits to pay a lump sum after a set period or in case of death, illness or accident.

Most products are long-term. This means premiums paid over the years will mature with interest and to add into your savings kitty. A policy is a good strategy for long term savings.

Fidelity Shield Kenya Prudential CIC Group PLC Madison Group Liberty Mutual Insurance

04/10/2022

6 excuses people use to avoid buying ...

04/10/2022

How fits into savings plan

Steve Mbogo

When you have saved some money, nothing compares to peace of mind knowing that you have a back-up in case of an emergency.

Not only is saved money likely to be readily available, it is free such that you do not have to pay interest on it. Tapping your means you avoid the embarrassment of borrowing from family and friends and certainly the risk exposure of getting it from a .

President William has severally spoken about the need to increase our national savings. Essentially, he is telling every Kenyan to either increase the amount they save or start saving.

There are many ways to save money and one of them is by buying a life policy.

The president’s motivation is to improve domestic resource mobilization because increase the pool of money from which the government can borrow to finance its activities.

Domestic borrowing may not necessarily be cheaper for the government but it has several advantages. Borrowing in local currency avoids foreign exchange repayment losses. Interest paid on local borrowing benefits . It reduces the risk of an external debt crisis and brings pride to the country for financing its investments with its own resources.

Central Bank of Kenya's national debt update shows that by December 2021, Kenya had borrowed nearly equal amounts from domestic and foreign markets. Domestic debt was Ksh4.03 trillion while external debt was slightly higher at Ksh4.17 trillion.

Life to the rescue



Life is defined as a between you and an company where you commit to paying a certain amount of premium and the company commits to pay a lump sum after a set period or in case of death, illness or accident.

Most products are long-term. This means that the amount of money saved is available for a long time for the government to . It also means the money will be incremental because premiums are paid in progressive intervals.

Kenya’s gross national savings averaged 8.2% of Gross Domestic Product (total value of goods and services produced in a year) as of the end of 2021 according to the . This compares poorly to economies such as Singapore whose gross domestic savings rate is 53.8%, India at 28.2% and Botswana at 23.4%.

What should companies do?

Kenya already has various life products to choose from. A key challenge for insurers is to invest more in , and of these products.

While previously said they were constrained to finance consistent advertising campaigns because of high ad-space costs in the traditional media of newspapers and television, the internet and especially the social media part of it presents and opportunities which can lead to better uptake of life products.

Another opportunity is presented by investing more in , innovating new digital life products or remodeling existing ones to align to the market needs of the potential mass buyers represented by and the .

How the government can become a enabler

It would be futile for President Ruto to promote the agenda of increasing while his administration is increasing and failing to provide cutting-edge leadership that will reduce the overall cost of living especially on and .

All pointers indicate an increase in taxation by Kenya Revenue Authority . The current intervention of in agriculture will depend on the performance of short-term .

Several studies indicate that for a country to increase its national savings, people must be empowered to have after spending on basic needs. The private sector must be enabled to thrive and create more jobs providing more people with income that they can spend and .

As the new Chancellor of the Exchequer for the United Kingdom Kwasi Kwarteng has said; “Taxing our way to prosperity has never worked”, while reversing higher rates imposed on the National Insurance by the previous administration.

What are some of the ideas that President has to increase savings? One of his regular mentions has been the National Social Security Fund (NSSF). As the president may be well aware, this institution has a negative reputation because of past unresolved corruption issues. It needs an overhaul of its structure and leadership.

What I mean is that beyond NSSF@NSSF_ke, the government should bring new ideas to the table, for example, partner with the private sector to start digital long-term savings products.

Government can provide the digital infrastructure while the private sector brings the products to the table. The government borrowing guarantees the demand for the funds mobilized through such an arrangement.

The opportunity to raise Kenya’s national savings to at least 20% is a great idea and should be pursued relentlessly.

04/10/2022

As tech nears insurance disruption, who are the players?

Steve Mbogo

When disrupted Consumer2Consumer and Consumer2Business payments, the question was whether technology will disrupt the traditional model in Kenya.

This question arose because Kenya’s *******on has failed to grow and most recent data shows that it is actually declining. So, while technology is enabling payment systems and access to banking, why has insurance taken longer to complete the cycle of technology-enabled ?

Data from Regulatory Authority and corroborated by .com shows that *******on - defined as the ratio of gross direct premium to the gross domestic product, has been declining since 2016.

Disruption of the market in Kenya will be a game changer in wealth creation and preservation because more Kenyans will access and insurance products.

It will mean more rural people will have access to well-priced protection, health and savings insurance products balancing the current scenario where Nairobi and Mombasa cities control nearly 90% of the insurance market in the country.

It may be a matter of time before that happens as the number of companies keep growing.

The market is likely approaching that moment when an product or a bundle of products will achieve a market acceptance, setting the pace for insurance to become a must-have financial planning tool for Kenyans.

leaders in the market so far

Lami
has created more buzz about in the Kenyan media perhaps more than any other product. The reason is the media attention driven by the achievement of its young female innovator Jihan Abass.

Lami has both and solutions. The is a product known as Griffin. The company’s platform enables the distribution of for customers, by providing the digital value chain needed to deliver the products and facilitate claims payment.

In early August, the company raised a US$3.7 million seed extension round to help it expand across Africa.


is a product that leverages affordability. Its key target market is motorbike riders, motorbike and matatu (public transport) passengers. Its core product is a personal accident policy that is payable daily for as low as $0.1 or $3 per month.

Affordability is one of the biggest impediments to insurance pe*******on in Kenya. Often, policyholders are required to make one-off payments for long-term covers, and the quoted sums are usually beyond the reach of most people. It is this gap that Kenyan insurtech MotiSure is working to seal.

The startup, which targets motorcycle taxi (boda boda) operators, their passengers and users of other forms of public transport (hereafter commuters), is building a business around daily micro-payments for personal accident covers, with some premiums going as low as $0.1.

The company uses the Internet of Things and technology to break down the in traditional personal insurance products.

InsureAfrika

This is an helping customers to easily which products suit their needs and pocket.

One needs to fill out an online form, that takes seconds to complete. The platform then generates quotes. A customer can then proceed to buy the on chose to pay later which allows discussing with the company on structured payment terms.

Kakbima

Kakbima is a B2B and aggregator company. In addition to aggregation solutions for price comparison by consumers, the company provides a platform for agents, brokers, micro-insurers, and insurers to deliver products.
According to Kakbima, its mission is to “make insurance instant, honest and delightful anywhere, anytime for everyone”.

Bismart Insurance

Bismart is an aggregator and vendor offering a range of insurance products. Customers can complete the process of buying on the company’s website.

AiCARE

This company uses driving behaviour to score and price for customers.
The company was incubated at BIMA Lab Insurtech accelerator run by the Insurance Regulatory Authority of Kenya and Prudential.
uses a machine learning algorithm that scores driving behaviour to generate data that is used for risk-based pricing of a product tailored to the data generated.
The company’s technology in addition to being applied in other mobility roles is used for motor insurance for people who drive less, by up to 25% as well as offer affordable and flexible solution for motorbikes per tribe or day.

ChamaSure

ChamaSure is an that describes itself as a ‘Peer to Peer Group Insurance’.
It leverages on to deliver well-priced health, funeral and loss of business stock solutions to small and micro scale business owners.

This is a true definition of how growing to mobile phones and affordable is enabling low-income communities to access high-quality and affordable solutions.

More focus on weather-indexed

Sprout Insure

This uses technology to deliver climate-based risk solutions to farmers.

It uses a system to deliver transparent, smart, -indexed crop insurance contracts to small-scale farmers, both crop and livestock. The company says that during an extreme weather event, the is paid out automatically, without filing or processing a claim, facilitating quick, transparent, fair and reliable payments.

mTek-Services

According to its website, this is a platform that provides an entirely paperless ecosystem for the insurance industry. Its platform allows customers to purchase directly from the , compare and file claims directly through their smart devices.

P**a

P**a is another -indexed crop and livestock digital insurance product designed to protect farmers from a wide range of climate risks including drought, excessive rainfall, pests and diseases, among others.

The company says it handles product design, risk placement, farmer education, claims assessment, and payouts. So far, the company says it has insured more than 4.8 million farmers in Kenya and across several other African countries.

Turaco

Turaco is an that works with partners to provide solutions to organisations with captive markets like SafeBoda which is focused on motorbike riders and M-KOPA, an asset-financing company for the unbanked population.

Safaricom Bima

Safaricom’s product known as is currently being tested in the market. It is expected to be in the market by the end of this year. This is a product to watch because of its potential to the market given Safaricom's existing muscle in thanks to .