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Thought leadership, insights, and success stories

CEO Perspectives: Closing the Protection Gap in Emerging Markets  

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“Emerging market consumers strive daily to create their own pathways out of poverty but all it takes is one sickness, natural disaster, or loss of a family member to erase all of their hard-earned progress.” (Inclusivity Solutions

If all it takes is one illness to undo the progress of building a better life in a developing market, you could imagine the relief insurance protection could potentially offer to someone living in an environment of uncertainty. Unfortunately, cost and accessibility pose as barriers for consumers in emerging markets to obtain insurance. This leaves a large portion of vulnerable populations with huge risk and deepens the protection gap. 

The insurance industry has a unique role to play in helping to bridge this protection gap by offering embedded insurance products. These are insurance solutions that are integrated into an existing customer sales journey and have been key to reducing barriers in the delivery and administration of insurance. With increased flexibility, affordability, and accessibility, the evolving innovation of embedded insurance products are making a significant impact in emerging markets.   

Increasing access to insurance in Africa

An inspiring example of this is the work Inclusivity Solutions is doing to increase access to insurance in several African countries. Realizing that a commonality among emerging consumers is access to mobile phones, the insurtech identified an opportunity to provide access to affordable insurance through mobile devices, taking into consideration the most basic ones. They partner with a wide variety of distribution partners such as mobile operators, banks, microfinance institutions, digital platforms, and insurers to deliver protection through a device that has become ubiquitous, even in developing markets. 

To date, Inclusivity Solutions has provided protection for over one million previously uninsured lives across Africa, an incredible feat.  

Inclusivity Solutions’ embedded insurance model is protecting and enhancing countless vulnerable individuals’ lives. We had the pleasure of sitting down with CEO, Indira Gopalakrishna, to get to know her and to dive deeper into the work they are doing to drive greater life insurance accessibility in Africa.  

Indira, can you tell our readers more about Inclusivity Solutions’ mission? 

Inclusivity Solutions is a B2B insurtech that is addressing and improving the way insurance is delivered. We do it by embedding insurance into mobile telephony, remittances, loans, and other services. Our technology brings instant, affordable, and appropriate coverage to customers, on their terms. Simultaneously, it helps our distribution partners drive more profitable customer behaviour, create new revenue streams and increase social impact.  

What brought you to Inclusivity Solutions and can you tell us a little bit about your background?  

My interest lies in building innovative business models that improve access to risk management solutions. After spending over a decade with multinational insurers in India and Singapore, I wanted to explore opportunities where I could use my skills to make more of a social impact.  

That led to a two-year fellowship in Kenya with the International Labour Organization’s Impact Insurance Facility. There, I helped Equity Bank’s insurance agency go digital. Inclusivity Solutions was the insurtech partner to Equity Bank and that was my first interaction with Jeremy Leach, Inclusivity Solutions’ Founder and Executive Director, his team. I was drawn to their vision of reimagining insurance through technology. I was thrilled when the opportunity to join the team came up.  

Our industry has always been challenged with creating awareness around the importance of life insurance and the lack of accessibility.  Can you share your perspective on this?  

The protection gap is a real concern, particularly in emerging markets. As per recent data, the global protection gap has reached a new high of $ 1.4 trillion in 2020, with emerging markets accounting for 59% of that gap1. There are various reasons why the protection gaps exist, but as you state, two of those are lack of awareness and accessibility.   

We believe that embedded insurance could solve both these issues, by taking insurance to where the customer is and providing a simple, appropriate cover. Integrating insurance into a product or service the customer already uses helps improve accessibility. And, providing customers with an option to add on a simple, appropriate cover at the time of purchase (e.g., fire insurance with the sale of a fire alarm) helps with awareness.  

What have you observed in Africa around overall life insurance fluency and education?  

Consumers in emerging markets have previously been excluded from traditional insurance products and this has contributed to low fluency and education. However, we are seeing a positive trend in all the African markets we operate in. We currently partner with 15 companies in 6 countries in Africa and each of our 1 million emerging customers has volitionally opted in for insurance. These data points suggest that the fluency in life insurance is on the rise. 

How is Inclusivity Solutions addressing some of these challenges?   

Through our award-winning, no-code, open API and proprietary digital insurance platform, combined with specialist insurance expertise, we enable our partners to offer relevant and affordable insurance to their customers, on their own terms.  

Our typical customer is self-employed or informally employed in small and medium enterprises. Without formal employers to provide coverage and without products targeting their needs, this segment has few or no options to access protection against high-cost health events or other financial shocks.  Our customers are already digitally connected using tools like mobile money and WhatsApp to run their vibrant businesses.  We meet customers where they are in their digital journey – whether from a basic mobile phone through to a smartphone. 

For example: one of our clients, MFS Africa, a digital payment gateway, sought to improve the resilience of their remittance customers. Migrants remit money home regularly, but shocks often disrupt this. By embedding a hospital cash insurance product into remittance transactions, MFS Africa has helped over 150,000 migrant workers become more resilient to shocks that could have otherwise disrupted their lives.  

How do you see the African insurance market evolving? 

I believe that the African insurance market is at an inflection point. The COVID-19 pandemic has accelerated existing trends toward digitalization and highlighted the importance of insurance. All the players in the ecosystem - insurers, insurtechs, and distribution partners - are coming together with a sense of urgency to reimagine the way insurance is delivered. 

What is next for Inclusivity Solutions? 

We have big ambitions for the future. Inclusivity Solutions has already reached one million customers and our aim is to reach a billion more. We plan to get there by scaling existing partnerships, expanding to more countries in Africa, and entering Asia in the next couple of years.  

The RGAX Takeaway 

Thank you, Indira, for taking the time to share how Inclusivity Solutions is using embedded insurance and technology to close the protection gap in the African market. Over the last couple of years, we’ve talked a lot about embedded solutions being the key to reaching underserved markets, from millennials to women, with life insurance products. Inclusivity Solutions demonstrates the importance of delivering solutions tailored to the unique needs of the insurance buyer. In the end, they provide a win/win for both the carrier and the customer, and that’s something we can all feel good about. 

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Written by: Tjaart Esterhuyse

Tjaart Esterhuyse is Head of RGAX and Strategic Products for EMEA. By looking beyond the horizon of the life insurance industry, Tjaart's team is focused on developing new and innovative products and solutions, distribution channels, and e-underwriting models.

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