Insurance players have been challenged to increase investments in digital transformations and processes in order to deepen insurance uptake amongst uninsured Kenyans.
This emerged during a thought leadership roundtable convened by Absa Bank Kenya dubbed “Digitization in the Insurance” which brought together key industry stakeholders in the insurance sector.
The session was opened by Absa Managing Principal, Corporate and Investment Banking James Agin who said digitization of insurance has come with greater expectations of service delivery, given the increased use of the mobile phone as a channel for delivery of financial services.
“The expansion of mobile wallets, payment infrastructure and enabling regulatory landscape offers an opportunity for insurers to accelerate its pace of digitisation in customer journeys and make a shift to digital channels in distribution of products.”
Data from a survey by consulting firm, KPMG shows that 76% of CEOs in the country see the digitisation of insurance as an opportunity rather than a threat while 88% will divest from insurance lines that have become obsolete.
A further 47% have invested in a robust digital strategy to increase their market share.
Martin Kimani, Director, Digital Innovations, KPMG said: “Digitization is more than a buzzword. Solutions such as Artificial Intelligence, Internet Of Things (IOT) and Chatbots are conduits for simplifying processes, enhancing customer experiences, and building customer trust and loyalty.
“Even as senior executives grapple with the issue of digitisation costs, now is the time for insurance companies to take advantage of digital transformations and streamline front to back end processes which provide ease and convenience to customers,” he added.
Julia Shisia, Head of Bancassurance at Absa Bank Kenya added that digitization was fundamental to capturing a predominantly youthful market across Africa, a majority of whom were under the age of 40.
“There are great opportunities to tap into a market with over 67 million potential customers, a majority of whom are young and dynamic. This therefore calls for collaborative approaches between insurers, insuretechs, and telcos to ensure that products emerging into the market are not only accessible to the remotest areas but also tailored to their shifting needs and lifestyle.”
Also present was Financial Sector Deepening (FSD) Principal Innovation For Resilience, Elias Omondi who reiterated the importance of transforming traditional systems in order to simplify the reconciliation and payments process in classes such as Motor and Health which account for the bulk of insurance classes in Kenya.
The penetration of insurance in Kenya is estimated to be at 2.3% of Kenya’s Gross Domestic Product, which is far below the global average of 7%.