AYO

The will to SUCCEED

LEVERAGING MOBILE TECHNOLOGY TO BRING INSURANCE PRODUCTS TO ALL ZAMBIANS: ANDREW NKOLOLA, CEO, AYO ZAMBIA

BY JACKIE MUINDE

nsurance penetration in Zambia, just like the rest

Iof the African continent, remains below the global average due to a number of factors, chief among them being a lack of awareness and a lack of trust by consumers in traditional insurance companies. aYo is, however, not your traditional insurer. It is a modern insurance company that leverages the power of technology, analytics, and mobile and digital channels to make life and hospital insurance accessible to millions of people across the African continent. It helps that it has the backing of Africa’s telecommunications giant MTN, which has an estimated 280 million subscribers across the continent. In a market like Zambia, where the Insurance market is expected to grow at a CAGR of more than 17% during the period 2020 and 2025, aYo was certainly going to be successful given the relevance of its products to average Zambian consumers. "We offer primarily life and hospital cash insurance, and by life, we mean a small ticket insurance that is affordable and linked to an individual's general usage of their mobile phone subscription in terms of either airtime or mobile money services if you like,” Andrew Nkolola, CEO aYo Zambia tells CEO Business Africa.

Today, aYo enjoys a subscriber base that is a little over 3 million customers. That is a remarkable feat for a company that is barely 2 years old. The company's success can be linked to the affordability of its products. "What we have tried to do is to link a level of affordability and accessibility and simplicity to our offering. That, by and large, gives benefits relating to the unfortunate death of a policyholder and or hospitalization over a specified period," Andrew elaborates. "So, we believe our offering is quite valuable and fills the need and void, especially for people with irregular income and that are exposed to quite a few risks around that daily living."

A relatively easy way of onboarding into the insurance program has also attracted customers in their millions. With aYo, customers only need to be active subscribers of MTN from where they can register for the insurance through a short USSD code. By enabling payment through MTN Mobile Money or recharge cards, aYo has also made it easier for customers to easily manage their insurance premiums, further encouraging uptake among many Zambians.

Andrew, a Zambian-born and bred insurance professional, knows firsthand the need to make insurance simple to onboard and affordable to maintain. “At a personal level, I have had relations, friends, and relatives

who, at one point or another, may have been economically disadvantaged and as a result could not have accessed what they need to help them when they're in calamitous situations. And I think I took it upon myself from there on to make this my crusade,” Andrew reveals.

A CUSTOMER-CENTRIC INSURANCE COMPANY

Andrew says that they are in a market where people have generally not had direct interaction or exposure to formal insurance. He further notes that even those that have, unfortunately, the experience may have not been very pleasant, particularly when it comes to claims settlement. Having been in the Zambian insurance scene for about 12 years, Andrew wants aYo to stand out from its peers. “We tried to tailor our products around the actual needs and expectations of our customers," he says. "One of the reasons why we also looked at life and hospital cash is basically from that feedback and interaction with our customers. We said we are not going to come with a product off the shelf but rather meet the real risks that are experienced daily by our customers."

A lot about providing customer-tailored products also has to do with consumer education. In many African communities, discussing with someone on anything about their death is unheard of. Even though this is ridiculous, many of us genuinely think we may even be “tempting fate” if we decide to take life insurance. Andrew believes this cultural belief is one of the biggest barriers to insurance penetration. The problem is further compounded by a low level of knowledge and understanding when it comes to insurance. aYo works to demystify such beliefs through an extensive customer education program. "We don't just sell policies or benefits to our customers. We try as much as possible to educate them through the journey as to what it is they're buying into, how to claim and when to claim, and what to expect when they do make their claim," says Andrew.

Andrew believes the actual services that they are offering from insurance, both life and where hospitalization is concerned, contributes to filling that gap and void where people face calamities because of some of the environmental changes we're experiencing globally and more so in Africa. "There are droughts, there are floods and other climate issues that impact individuals at a go, and as a result, they do need some kind of support or safety net. So, our contribution from an offering perspective speaks to that," he says.

With climate change fast catching up with us, Andrew confides in us that the company is also exploring sustainability-related product offerings that speak directly to customers. That product could be agriculture insurance or index insurance to protect farmers when they lose their crops as a result of drought, or anything related to climate change issues. Just like aYo's existing products, these too will be rolled out in the space of innovation and technology to make it easier for the customer to access them at an affordable price. The focus, according to Andrew, will be on ensuring the products impart real value to customers whenever they experience any climate-linked calamity.

TECHNOLOGY PROVIDES A BULWARK FOR GROWTH

What has helped aYo achieve unprecedented success is the fact that it is majorly a digital service company. Leveraging already existing technology, the company has been able to roll out its products with a relatively higher success rate in Zambia. High mobile penetration rates in the country have ensured aYo has an expanded customer reach and with much of the digital population still untapped, opportunities for further growth still exist. “With a mobile phone penetration rate of above 80% in the country, we believe this offers Zambians from all walks of life the ability to access affordable, easy-to-use insurance that is relevant to their needs that they have control over,” Andrew says.

Robust investments from the company's primary shareholder, MTN Group have been key in the company's growth journey both in Zambia and in the rest of the

continent where it already has a footprint. The company is however confident that it can easily tap into the venture funding market should it need external sources of funding. “Though we may not be involved in that space currently, depending on the situation and the time and the market itself, even those options, I believe, are viable because we always look at the new markets that we enter and the business starting this new market as a start-up in itself.” The CEO is, however, satisfied that the resources it currently gets are enough to help it achieve its goals. “For the foreseeable future, we will continue to leverage off of the good support we are getting from MTN as a group and any other partners that will collaborate with them at that level and share the same vision we are trying to bring to fruition."

"BY ENABLING PAYMENT THROUGH MTN MOBILE MONEY OR RECHARGE CARDS, AYO HAS ALSO MADE IT EASIER FOR CUSTOMERS TO EASILY MANAGE THEIR INSURANCE PREMIUMS, FURTHER ENCOURAGING UPTAKE AMONG MANY ZAMBIANS."

BUILDING AN AFRICAN FOOTPRINT

For Ayo and other microinsurers, the pandemic meant more business. Andrew says that his company greatly benefitted from the high level of appreciation for insurance services that arose during the pandemic period. "From a knowledge, ability perspective, I think COVID also brought to the fore a closer conscious around what risks are apparent to people and how best they can take care of them when these issues arise,” Andrew points out. After the pandemic, Andrew says that the company is now looking at expanding its product offering to cater to broader healthcare risks that people are experiencing.

Continentally, aYo has very robust expansion plans leveraging MTN's pan-African presence. The strategy, according to Andrew, is to have a presence “wherever we have the telco capability as well as other digital facilities.” The insurtech, which began in Uganda and is currently in three other African countries, including Zambia, Ghana, and Cote d'Ivoire, has plans to launch in several more in the near future. Nigeria, Cameroon, and Benin are some of the already confirmed markets that aYo is serious about venturing into. A soon to be announced East African country is also in the mix. “We are hopeful that we will be able to provide or will be able to have aYo as a partner providing insurance in those countries.”