In a significant leap for the Ugandan insurtech scene, Turaco, a prominent player in the African insurance technology sector, has clinched the distinction of becoming the first insurtech company in Uganda to secure an underwriting license. This groundbreaking achievement comes with a pledge to spearhead the provision of accessible and straightforward microinsurance offerings, aimed at bridging the insurance gap for underserved communities across Uganda. This milestone aligns seamlessly with Turaco’s global ambition of extending insurance coverage to an impressive one billion individuals.
Under the umbrella of “Turaco Microinsurance,” the company is poised to develop and distribute uncomplicated insurance products tailored to the specific risks faced by mass-market customers. Impressively, these policies will kick off at an astonishingly low UGX1,000 per month. Distinguishing itself through a customer-centric approach, Turaco Microinsurance vows to present terms and conditions so succinct that they can be encompassed within just three SMS messages. Even individuals unfamiliar with insurance will be empowered to comprehend their policies and the extent of their coverage.
In its role as an underwriter, Turaco Microinsurance is set to revolutionize the enrollment process by seamlessly integrating with distribution partners’ systems through APIs. This integration will empower customers to access insurance coverage at the mere touch of a button. Notably, the company is committed to expediting claims processing, with claims slated to be paid out within hours. This efficiency is expected to foster a new level of trust both in insurance products and the broader insurance industry.
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Turaco Microinsurance Company stands as the Ugandan arm responsible for underwriting within the Turaco Group, an all-encompassing Pan-African embedded insurtech endeavor. This larger initiative is dedicated to fostering financial resilience in emerging markets through affordable and straightforward health and life insurance options designed for underserved populations. Since its establishment in 2019, Turaco has already made its presence felt in Kenya, Uganda, and Nigeria.
By partnering with leading mobile network operators, technology-enabled companies, and microfinance institutions, Turaco has been able to effectively distribute accessible insurance products to its customer base. Remarkably, individuals can secure insurance coverage with premiums starting as low as USD1 per month. The company’s claims processing time, clocking in at less than three business days, ensures that policyholders receive their rightful compensation promptly. Thus far, Turaco has successfully insured over a million lives and facilitated the settlement of more than 15,000 claims.
Hamza Mutebi, the General Manager and Principal Officer of Turaco Microinsurance Company, articulated the significance of this achievement during the official launch. “Today marks a monumental achievement for Turaco,” Mutebi stated, highlighting the journey from their origins as an agency to their current status as an underwriting entity. This license acquisition paves the way for the creation and dissemination of affordable and accessible products, thus enabling Turaco to extend its reach to even more underserved individuals while harnessing technology for efficient claims processing.
Bernard Obel, the Director of Supervision at the Insurance Regulatory Authority (IRA), emphasized the necessity of innovation in microinsurance. He underlined how microinsurance targets a demographic often unfamiliar with insurance concepts and stressed the need for insurers to craft easily comprehensible products. Turaco’s pivotal role in expanding insurance accessibility to the mass market through strategic distribution was acknowledged. He expressed the regulatory body’s commitment to collaborating with Turaco and the insurance industry at large to develop products, define governance, and establish service standards.
The dire consequences of health emergencies for low-income households in Africa were also highlighted. Limited financial resiliency frequently renders these households vulnerable to unforeseen medical costs, often plunging them into poverty. Shockingly, over 14 million low-income households are pushed into poverty annually due to health-related expenses. In Uganda, more than 15% of the population faces catastrophic health expenses each year. Unfortunately, insurance adoption remains low, with a mere 2% of individuals in sub-Saharan Africa being insured, and less than 1% of Ugandans holding insurance coverage.
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Turaco Microinsurance aspires to leverage its triumphant technology-driven insurance distribution model to bolster insurance penetration in Uganda. The company plans to blend Turaco’s user-friendly policy sign-up process and expedited claims processing via WhatsApp with its newfound underwriting capacity, enabling the creation of innovative and affordable insurance products.
In a landscape characterized by limited insurance coverage and understanding, Turaco’s acquisition of the underwriting license is set to be a transformative step. As it forges ahead with its mission of insuring one billion lives in Africa, Turaco’s pioneering strides will likely serve as an inspiration to other players in the industry to prioritize innovation, accessibility, and simplicity in the realm of microinsurance.
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Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard