Encouraging financial inclusion through technology-led microinsurance services

By Dipak Patel - Senior Manager Presales, Panamax 

The insurance industry constantly needs to evolve and address the critical needs of their existing and potential customers. As such, tailored services are the talk of the town and are highly attractive to customers. In order to encourage financial inclusion in regions such as Africa, insurance companies need to adapt and introduce an insurance that people can afford. This is where the microinsurance model can be hugely beneficial.


Understanding microinsurance
Microinsurance is an insurance that is tailored to suit the specific needs of low-income groups or the urban poor in developing economies. Saying that microinsurance will reduce poverty might sound like an overstatement, yet it's not erroneous to suggest that microinsurance would undoubtedly help those with a limited income cope with unforeseen expenses in the areas of health, property, automobiles and agriculture, amongst others. It will also aid in including more people in developing countries into the financial ecosystem.


The ramifications for businesses

First of all, businesses need to understand that this is not a CSR activity or a charity model. On the contrary, there are many business benefits tagged to microinsurance. Introducing microinsurance will help insurance services penetrate more deeply into the market and cover all those potential customers who cannot afford huge premium payments. This, in turn, generates profits for insurance companies. In addition to profits, the insurance providers can tap into a larger, more diversified risk pool and also earn a more solid reputation. Additionally, these insurance providers enjoy the 'first mover' advantage and can fortify a sustained growth in developing markets.



Driving microinsurance deep into the ecosystem using mobile finance technology

In order to facilitate sustainable growth, to include more people who actually need microinsurance into the fabric, and to tap into the emerging opportunities on the continent - innovation, agility, and collaboration are important. These should be applied to see how microinsurance can be distributed across Africa.

Distribution drives microinsurance and without it, even a high quality product is rendered irrelevant. Therefore, it is important to select a distribution channel that is appropriate for your target market. When there is the lack of proper mass distribution channels, then reaching out to people who need microinsurance can be a huge struggle.

Mobile microinsurance (MMI) is the savior in this instance. MMI is successfully used by agent-led models, bank-led models, MNO-led models and business models to run successful insurance services. While agent-led models are popular in Asia Pacific, and bank-led models in emerged markets, in Africa we have seen a surge in the popularity and success of an MNO-led model. 

The MNO-led model - A success story in Africa

MNOs in Africa lead the way to the mass adoption of microinsurance. According to The Landscape of Microinsurance in Africa report (2015), mass market channels (specifically MNOs) are common for microinsurance distribution. The report indicates that more than 200 providers from 36 countries, out of the total 52 countries in Africa, reported some kind of microinsurance activity. A total of USD 647 million was spent on microinsurance premiums. Around 5.4% of the total population was covered and about 61.9 million people were insured.

Today MNOs are not merely providing a delivery channel, they are driving MMI development. Previously, MMI was used by insurers only as a tool to expand their customer base, but today mobile microinsurance is largely used by MNOs to build customer loyalty and reduce churn in an increasingly competitive voice market.

Mobile network operators (MNOs) are taking charge, as often as the insurers. Around one-third of deployment (equal to insurers) is led by MNOs. The remaining is driven by banks, governments and third parties. Today, MNOs are actively involved in the branding, marketing and development of MMI products and establishing a front-end relationship with customers, thus playing a role that is more etched and evolved than simply being a distribution channel.

Clearly, mobile finance technology is the driving force behind deep penetration of microinsurance amongst the low-income and urban poor population. Mobile microinsurance solutions enable insurance companies to offer a wide range of services and products over mobile, with or without agent intervention. This also offers customers the convenience to choose options that will cover them, yet still not force them to pay for deductibles they will probably never use.


About Dipak Patel:



Dipak has been in the telecommunications sector for more than 10 years. He currently serves as Sr. Manager Pre-sales at Panamax. Panamax is a leading technology company offering innovative & market-proven telecom switching, carrier business automation and mobile financial solutions. Dipak has shouldered various responsibilities, in Support, Operations, Training, & Pre-sales departments in the organisation.

Dipak is passionate about mobile finance solutions, and providing expert guidance to team members, customers and partners has always been his expertise. His penchant for cutting edge technologies, together with his passion in delivering outstanding solutions, is what drives him forward.

Dipak is visiting East Africa Com as a representative of Panamax Inc. Meet him at booth number 9. You can also send him an email at sales@panamaxil.com to schedule a meeting at the event.


Webisite: www.panamaxil.com
Twitter: www.twitter.com/panamax_inc
LinkedIn: www.linkedin.com/in/dipak1432003


East Africa Com will be taking place in Nairobi between 18 -19 May, 2016.

Three ways the Globalized Network will connect businesses and communities in Africa

By Brian Jakins - Regional Vice President, Intelsat Africa

It’s no understatement to say the infrastructure of Africa is complicated. The continent’s topology, economics and regulatory environments vary by country and region – which is no minor detail with 52 countries and thousands of different ethnic groups across the continent. As a result, serving the disparate needs of enterprises, governments and communities across Africa can be a challenge for mobile providers and network operators.

This is where the Intelsat Globalized Network – with its integrated satellite and terrestrial technology, services and capabilities – enables operators in Africa to open new markets, drive new revenue streams and ensure their customers enjoy the most reliable broadband communications.

Here are just three of the hurdles facing network operators in Africa today:

• Increasing broadband demands – throughout Africa, mobile data consumption is on the rise. 
• More and more people are watching TV and videos on their mobile devices. In fact, more Africans watch videos on mobile screens than on television screens. 
• The rise of apps such as Snapchat and WhatsApp are adding to the pressure for data connectivity, putting a strain on the mobile networks.
• Increasing costs of infrastructure and management – more and more network operators are shying away from infrastructure investments. In some areas – particularly in Western Africa – a tougher economic climate is spurring operators to outsource more in order to focus on brand management, adding revenue-generating activities and shareholder returns.
• Increasing complexities – with more technologies and services coming into the region, determining the right solutions to solve communications challenges can be complicated.

Yet at the same time, there are many opportunities for network operators in the region. With terrestrial broadband coverage expanding in many African countries, high-throughput satellites (HTS), like the Intelsat EpicNG platform, will unlock new markets and applications for mobile providers. The launch of our second Intelsat EpicNG satellite, Intelsat 33e (IS-33e), slated for later this year, will bring a technological step change and commercial flexibility for our customers to address some of these challenges to meet their business needs and that of the communities they serve.

For example, remote areas of Africa don’t have the populations to justify connecting them to central terrestrial networks. However, with high-power spot beams of Intelsat EpicNG, those economies will be improved, providing internet access for previously inaccessible areas of the market. This is because the kits required to receive signals from our HTS spot beams are smaller and more portable than those necessary for connecting to wide beams, making them easier to install in remote areas. Moreover, many of these kits are solar-powered, which makes them usable in areas where power supply can be unpredictable.

With IS-33e, we can better address the domestic broadband via satellite market in Africa. Whereas today, broadband delivery is focused on a few core markets with terrestrial connections, our HTS solution will allow telcos in the different markets to offer a uniform Internet service that can serve a lot of people.

New managed services, such as our IntelsatOne Flex for Enterprise offering, help network operators stay ahead of their customers’ emerging demands. Ours is a managed service that allows regional and global providers to access and incorporate HTS into their networks, seamlessly and with great control and scalability. IntelsatOne Flex allows network operators to outsource the complex tasks of terminal installation and network integration. At the same time, they can reduce expenses by flexibly allocating bandwidth to meet surges in demand or new geographic requirements.

There is no doubt that broadband connections will expand to more African households, but to eliminate the barriers between countries, organizations and people, it takes more than just global connections – it takes a Globalized Network. With HTS and other technologies imminent, it’s easy to imagine delivering connections to mobile Wi-Fi hotspots on buses or feeding data to soda vending machines with a massive data broadcast services. In Africa, where Intelsat has acted and operated traditionally, we will remain, but we will also evolve – and make it easier for anyone to connect or work with anyone else, anywhere in the world.

About Brian Jakins:
Brian Jakins is a speaker at this year's East Africa Com and leads Intelsat’s sales activities in Africa, overseeing a sales team with offices in Sandton, South Africa, and Dakar, Senegal. He supports the growth of Intelsat’s broadband, mobility and media customers in the region and is also responsible for the design and implementation of the company’s sales strategy and business development across the continent.

East Africa Com Silver Sponsor Intelsat operates the world’s first Globalized Network, delivering high-quality, cost-effective video and broadband services anywhere in the world. Its Globalized Network combines the world’s largest satellite backbone with terrestrial infrastructure, managed services and an open, interoperable architecture to enable customers to drive revenue and reach through a new generation of network services. ways in which we live.


Visit the East Africa Com website to book your place today.
Intelsat: www.intelsat.com
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LinkedIn: Brian Jakins Intelsat
This article originally featured on the Intelsat blog.