By Favour Nnabugwu
MANAGING Director of Africa Reinsurance Corporation (Africa Re), Mr Corneille Karekezi has advised the continent’s insurance industry to leverage on the current technology revolution in order to remain relevant.
Speaking at the 25th annual conference of the Federation of Afro-Asian Insurers and Reinsurers in Bahrain recently, Karekezi said that the poor reputation of insurers continue to hold back the sector in the region.
He stated: “Though the global insurance industry is deriving a lot of pride in being the main recourse of people in difficult times, especially for events caused by accidents or natural catastrophes, the poor reputation attached to the industry, especially in Africa and other developing countries, still remains a big challenge.”
The Africa Re boss said one of the main reasons for this poor reputation is the consistent perception that insurers are not reliable and do not keep their promises.
He stated further: “In the entire African continent, the average insurance penetration is about 2.7 percent. Apart from South Africa (14.2 percent), Namibia (8.8 percent), Mauritius (8.4 percent), Morocco (3.48 percent) Kenya (2.8 percent) and Tunisia (1.9 percent), the remaining countries usually record less than 1% penetration rate.
“With the skewed end-user perception, the challenge revolves around the best strategies to improve this low insurance penetration rate in this era of fast technological advancement. This can only be achieved by reconciling and resolving the issues of trust.
“The journey is still long for the African insurance industry. The issue of trust needs to be addressed and this can only be achieved with a customer-focused strategy, otherwise known as customer-centricity.
“Customer-centricity is not just about offering great customer service, it means offering a great experience from the awareness stage, through the purchasing process and finally through the post-purchase process.
“It’s a strategy that’s based on putting your customer first and at the core of your business, as the new insurer customer segments are more diverse, more demanding, more sophisticated and more hedonistic,” he added.
Adopting technology in the insurance space, according to him, has some challenges of its own, which all insurers need to be wary of. These, he stated, include: legacy technology overhaul costs; cultural constraints; regulatory environments; cybersecurity and consumer data protection; internet penetration and capacity; and the threat of non-traditional players entering the market. “It is also worthy of note that other non-traditional players like Google, Facebook, Apple, Amazon and Alibaba Group have been encroaching into the insurance space,” said Mr Karekezi.