Mobile insurance: The future of the insurance sector in Kenya, isn’t it?

Mobile insurance: The future of the insurance sector in Kenya, isn’t it?

Mobile insurance (just like mobile banking- the use of Mobile phones to send and receive money, withdraw, buy goods and services and pay bills) is the use of mobile phones to increase the sale of insurance services through simplifying the procedures. I don’t mean taking insurance covers for mobile phones.

Since the mobile penetration in Kenya according to the Communications Authority of Kenya (CAK) is over 90%, it is a promising way to increase insurance market penetration. This means, to penetrate the market all the players in the insurance sector should look for ways to tap the potential in mobile phones.

There are a number of ways insurance services can be offered to customers in a more efficient way. And in the same way, there are many ways that can be employed to increase the number of customers consuming insurance services. This can be through mobile offices, agents as well as mobile phones. This ensures that the products reach the masses in a more reliable, efficient and economical way possible.

Today I am talking about mobile phones and insurance- Mobile insurance. There are a number of ways mobile phones can be used to simplify the operations in the insurance industry.

Insurance accessibility.
Accessing insurance covers in Kenya is very procedural. This discourages many people from subscribing for the services. For example, a woman in the village prone to burglary should be willing to take insurance cover against the eventuality, but because she cannot do that without travelling, she opts not to. This means, if there was a way she could do that through her mobile phone, she would definitely take a cover. This example is just a reflection of our villages.

Therefore, the insurance companies should come up with ways in which individuals can buy insurance through their mobile phones just like the same way we buy airtime. This can be through mobile Apps (for those with smartphones) and USSD for the ones with cell phones. This will ensure that everyone can access the service at the comfort of their sitting rooms.

Marketing and distribution.
Access to customers and the complexity of its products has been the bane of the insurance. Mobile apps provide greater access to customers’ mind share. No doubt, some of the early insurance apps are informational apps. They provide information such as guidelines on what to do when you get involved an accident, where to find the closest agent, nearest tow-truck points etc. The industry is moving towards achieving real-time informational and transactional capabilities for these mobile devices. All the apps mentioned above, as well as others, allow customers to get quotes, file claims, view policy information and make policy changes and much more.

While the attention of the mobile application world is focused on the customers, insurers should also use smartphones and other mobile devices for agents, brokers, advisers and other intermediaries.

Claims handling.
Mobile apps together with the next generation of augmented reality (AR) application can have a significant impact on increasing efficiency of claims processing, reducing losses and decreasing claims fraud.

In addition, AR applications can determine damage impact and repair estimates based on the photographs of accidents or property damages. Thus, AR applications can be adopted to provide such functionality.

With the total incurred losses in private passenger liability and private passenger physical damage amounting to billions of shillings in Kenya, a small improvement from these technologies could result in significant savings to the industry.

In nutshell, the integration of the fast-moving mobile apps and mobile technological advancement with the giant (but slow-moving) insurance sector, will significantly improve the industry and many people will become customers thus enhancing the insurance penetration. Therefore mobile insurance should not be overlooked but prioritized as the future of the insurance sector in Kenya.

Also read: Insurance Industry and COVID-19 Pandemic.

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