Menu

NIC grants 5 insurtechs sandbox innovation licences

Wsqwqwq This initiative is aimed at boosting the country’s low insurance penetration rate

Thu, 17 Oct 2024 Source: thebftonline.com

The National Insurance Commission (NIC) has granted sandbox innovation licences to five insurtech companies.

This initiative, aimed at boosting the country’s low insurance penetration rate, allows these firms to pilot innovative products for a year before potentially receiving full licences.

Michael Kofi Andoh, Commissioner of Insurance, emphasised the regulator’s positive approach: “As a forward-looking insurance regulator, the NIC is committed to enabling market players leverage innovation and technology for market development.

“Our modern Insurance Act supports innovation and we anticipate that the market will seize this opportunity to expand insurance access, bridge the protection gap and safeguard policyholder interests”.

The five licenced insurtechs represent a diverse range of technological solutions. They include Figtech, an insurance aggregator streamlining the customer journey from policy purchase to claim settlement; and Moovon Insure, an online platform offering flexible pay-as-you-go premium payments.

The others are Holland Insurance and Nigerian-based ETAP, a partnership leveraging mobile telematics for flexible premium payments; and Trade Guarantee Limited (TGL) offering ‘Sorpi Sorpi’, a telematics-based third-party motor add-on service.

Red Pear, an aggregator platform providing product variety from multiple insurers, rounds up the initial cohort.

This regulatory sandbox project is supported by FSD Africa’s Bimalab programme, which operates across 16 African countries.

The programme has already made significant strides, having accelerated 100 insurtechs continent-wide – enabling 75 new projects, increasing coverage by 5 million and facilitating US$35million in capital raise for participating insurtechs.

Elias Omondi, Principal for Innovation and Bimalab lead at FSD Africa, praised Ghana’s regulatory approach: “Insurance is a great way to build resilience for our businesses and lives. Yet here in Africa insurance services remain a preserve of just a few – often due to low coverage and prohibitive costs.

“Innovations such as insurtechs are dealing with these challenges by offering exciting modern products, expanding coverage to underserved communities and lowering service costs. A supportive regulatory regime is key for this to happen and we laud NIC for being strongly pro-innovation.”

The initiative comes at a crucial time for Ghana’s insurance sector. With only 2 percent of the population currently covered by insurance products, there is significant room for growth.

The sector – comprising 26 non-life companies, 18 life companies, 3 re-insurance companies, 113 insurance brokers and 5000 agents – reported total assets of GH¢17billion at the end of 2023.

One success story emerging from the Bimalab programme is Ibisa, a climate-focused insurtech that recently secured US$3million in funding. This investment will enable Ibisa to scale its parametric insurance solutions for weather-related risks in Africa, addressing a critical need on a continent increasingly affected by climate change.

The global impact of extreme weather events on agriculture is estimated to cost between US$10-15billion annually, according to the United Nations Food and Agriculture Organisation. Ibisa’s solutions aim to make parametric insurance more accessible to those affected by these climate-related risks.

Analysts believe that as Ghana’s insurance sector embraces these technological advancements, it sets a precedent for other African nations. The success of this sandbox approach could potentially influence regulatory frameworks across the continent, fostering a more innovative and inclusive insurance landscape.

Source: thebftonline.com
Related Articles: