A survey carried out by PricewaterhouseCoopers (PwC) has identified technology and data revolution as a top theme driving a revolution in Africa’s insurance industry.
According to PwC, the insurance industry has done well to adapt to continuous disruption, with technological advances now considered the most important global trend disrupting the industry.
“Across all of Africa, the increased use of technology, on the back of the exponential growth of mobile phones, has significantly contributed to a large number of new customers and more tailored products,” a recent report from PwC highlighted.
“Technology presents insurers with powerful tools to better understand customer needs and expectations through data mining capabilities and artificial intelligence (AI),” adding, opportunities for growth in Africa’s insurance industry are huge despite recent economic and political uncertainty.
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It noted, “The market remains one of the least penetrated in the world. ”
The PwC report titled “Ready and Willing: African insurance industry poised for growth” comes at a time when economies on the African continent are starting to show signs of real growth on the back of recovering global commodity prices.
Victor Muguto, long-term insurance leader for PwC Africa said “The insurance industry across Africa continues to be one of the most disrupted, but at the same time the industry continues to innovate and adapt to take advantage of the many opportunities for growth that are also emerging.
“In the years following the global financial crisis, economic and political uncertainty across the continent slowed down economic and insurance sector growth. Despite this, Africa’s insurance market remains one of the least penetrated in the world and the opportunities for growth are tremendous.”
Although the leading professional financial service firm noted other top trends such as regulatory and accounting changes, social and demographic changes, multichannel distribution strategies etc as drivers of change in Africa’s insurance markets, they are also of the opinion that such developments show Africa’s insurance industry is facing more disruption than any other industry, posing challenges for some while opening up business opportunities for others.
“The pace of change in the insurance industry has taken place more rapidly than originally anticipated and will accelerate further,” they further explain.
“Leading insurers are already implementing key strategies to focus on new customer behaviours and demographic shifts. The need to be agile in the face of a rapidly changing technological environment has never been more vital,” said Pieter Crafford, financial services advisory leader for PwC South Africa.