Selling or Taking Insurance to the masses, or rather the Emerging Market.

I have penned down my opinion and the challenges on taking Insurance to the masses more than once before.

I now have read a document released by Delloite, entitled, Emerging Markets – Growing Insurance and challenges, with a focus on Africa. (Published on Google)

In my previous article, I mentioned the challenge of collecting the money from the prospective insured a client in the informal sector.

Delloite in this publication posted on Google highlight two sets of challenges, although according to them the potential for growth is real. We need to find the solution to the following challenges as published in the document posted by Deloitte.

“Key challenges (1)

  • Inappropriate distribution channels
  • Poor infrastructure
  • Insufficient knowledge/skills
  • Paper based processes
  • Products not suited to market
  • Copy and paste
  • Complex terms and conditions
  • Irregular income levels
  • Unbanked community”

“Key challenges (2)

  • Lack of trust
  • Driven by fraud
  • Poorly trained brokers
  • Limited understanding of insurance by policyholders
  • Significant delays
  • Other challenges
  • Poor literacy
  • Low income
  • Alternatives to insurance e.g., community-based schemes…”

 

If we want to make a breakthrough into this emerging market, in South Africa, we must build a trust relationship, break the perception and feeling of mistrust.
This is the number one challenge in my opinion, the second major challenge will be to find a way of collecting the premiums.

Brokers need to interact and understand the needs of these clients, in other words train the broker to communicate and interact at the level of the client targeted.

I always and still say, the emerging market is just as entitled to be placed in the same situation, he or she was before an event like the storms we experienced of late in Gauteng, where the whole shack and all his earthly belongings has been washed away. Then because he had a policy with bare basic all risk cover on contents, can be helped along the way to have his belongings replaced, and at the same time the trust relation restored.

Enough has been written about this – I suggest it is time to act.