How smart contracts and mobile technology are changing the insurance landscape in Africa

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According to experts, insurance penetration in Africa is below the world average. Its rate is less than 3% compared to global averages of nearly 8%. With growing threats, Africa represents a reason for innovation, but only if the challenges are addressed.

Accessibility is a key factor that has kept many away from insurance products. The premium payments and slow claims process have made many skeptical about the benefits of insurance. However, experts now believe these challenges can be addressed through the use of technology. With technology, the rise of micro-insurance that allows for the payment of small premiums is the key to unlocking stabilized insurance growth in Africa.

Research firm Brookings states in its analysis that: “The adoption of technology and innovation are the keys to the growth of the African insurance sector. Micro-insurance could also change the name of the game, as it can reach the nascent African middle class through small-scale, low-cost and low-risk products ”.

These micro-insurance products may partner with or be a product of telecommunications companies that have a wider audience spread across various economic groups.

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