Growth in life and health insurance policies has been driven by the Covid-19 pandemic and the company’s record on paying Covid-related claims, Brown says. “The idea of loss is at the top of people’s minds.” He claims that the company is the only insurer in francophone Africa which made Covid-related pay-outs. The results of that decision “will be very positive,” and the industry would grow faster if all African insurers paid claims quickly, he says.
Prudential, whose main businesses are life and health insurance, in 2021 took a strategic decision to focus on Asian and African markets. It operates in eight African countries, Uganda, Zambia, Cameroon, Togo, Côte d’Ivoire, Ghana, Nigeria and Kenya. The company in 2021 moved its African headquarters from London to Nairobi “to show intent,” Brown says.
Feasibility studies are being carried out with a view to possible new entry into “a couple” of African countries, he says. Brown is interested in developing new partnerships including with banks, fintechs and telcos to support expansion, while having the option to go it alone.
- Prudential in June said that it wants to widen the scope of its Ghanaian partnerships with Vodafone and Airtel.
- The company said in August that annual premium equivalent (APE) sales in Africa increased 17% in the first half of the year, with double-digit growth in six of its eight markets.*
- Brown is optimistic that the growth of digital distribution methods, which historically haven’t existed, and a “tech-savvy middle class” in Africa will mean insurance growth.
- The next five years “will see a jump in penetration” across the continent.
Life and health insurance penetration on the continent excluding South Africa has historically been held back by factors including lack of awareness and low disposable incomes, Brown says. Unfavourable regulations in some markets are also a factor, with some francophone countries requiring separate licenses for life and health insurance.
The company plans to roll out a health-insurance app in Africa which uses artificial intelligence to offer policies combined with health advice. Prudential in April partnered with Singapore-based digital health company Nervotec to help people monitor health and stress levels. Users of the “Pulse” app can monitor their heart rate, respiration and oxygen saturation levels by scanning their face with a mobile phone.
The app is in use in Asia and is currently being tested before African roll-out. Prudential is applying to African national regulators to be allowed to sell the product and aims to make it available in most operating countries early next year.
- “The need for health insurance will keep growing,” Brown says. He sees that demand as one way to increase interest in life policies. “If you treat the client right, they will give you more of their risk.”
- Higher inflation across Africa is one obstacle for the industry. Inflation is “biting into just about everything,” Brown says. He’s confident that smaller products with lower premiums can help sustain growth.
If anyone can offer the affordable policies needed to crack life insurance in Africa, it will need to be a scale player such as Prudential.
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