We target 25m subscribers in insurance: broker

INTERVIEW. Travellers have started accessing insurance services by paying Sh200, in domestic journeys. BusinessWeek reporter Alfred Zacharia interviewed Mr Mohammed Jaffer, chief executive officer of Tanmanagement Insurance Broker Ltd, that is behind the idea in partnership with Jubilee Insurance

QUESTION: Why did you decide to come up with this idea?

ANSWER: I have been working in the insurance industry since 2002 and happened to be the president of Associations and Institutes in Tanzania and East Africa.

I have been blessed that I have worked with a number of ministries representing stakeholders in the industry and the common challenges faced across borders made me realize that the solution also had to be something that can work across borders.

What was really your target?

The real target was and still is to launch at least five more products on the platform within 2019 and to cover at least 25 million Tanzanians within the next three to five years.

Insurance coverage is still low in Tanzania and the public confidence on the sector, mainly life insurance, has remained low. How will this platform penetrate through such challenges?

The Bima-Time Platform (Safari Vocha is our first product out of five products which we are targeting to release in 2019) solves the two biggest challenges faced in attaining insurance penetration in East and Central Africa. Those challenges are the challenge of ‘accessibility’ and ‘availability’.

Through Bima-Time Platform, these are both addressed because we are aiming at having over 50,000 vendors in three years-time which is the equivalent of mobile operators such as Airtel, Vodacom and the like.

This distribution network will enable us to reach every corner of the country and our hope is to launch by 2021 in at least two other countries as well. The insurance covers will then become regional and not only single-country.

So a medical insurance purchased in Tanzania through Bima-Time Platform will also be serviced in neighbouring countries where the platform will be operational. Our 5 target products are: Safari Vocha, Maisha Vocha, Afya Vocha, Kilimo Vocha and Boda Boda Third Party Vocha.

When did you come up with an idea and how did you start implementing an idea?

The idea to have a scratch card based platform (which is now also going to be extended to allow purchase through mobile money) came in 2017 when I was discussing with colleagues on an innovative distribution model that can reach everywhere. Similar to Coca-Cola or Azam and the like.

I started researching on the best distributed or as they say ‘available everywhere’ products. Insurance has very strict regulations because it is peoples’ money so in 2017 we wrote to the Tanzania Insurance Regulatory Authority (Tira) on our proposal and the concept.

We were supported very strongly by Tira and the commissioner who tasked our firm to work on the platform on priority so that a live demonstration could be done.

Around July 2018 we made our first presentation to Tira and received very good inputs from Tira which we immediately worked on. We received our formal approval towards the end of October 2018 and launched on 15th November 2018. From 15th November 2018 to 31st December 2018 we sold over 2,000 policies and in January 2019 we sold 894 policies.

Most of these policies are of Sh200 only so the quantum is not very large but we have only launched in Arusha and parts of Dar es Salaam. We are also very positive because the response has been very good from the public. We will now be launching in February 2019 in Dar es Salaam, Morogoro, Mwanza, Dodoma and Kigoma. After which, in March we will go to Mbeya, Singida, Tanga and other regions to ensure that by July 2019 we have covered the entire country.

How difficult or easy is it for one to become an innovator in Tanzania?

The major challenge in innovation is “funding”. Ideas and innovations can be brilliant and at times even mind-boggling, however, to implement those ideas, a sizeable amount of funding is required and therein lies the challenge. An innovator will never want to give away his Patent or Copyright but without funding the idea will remain an idea.

In regard to Tanzania, if funding is sourced then Tanzania is very accommodative to Innovation as our meetings with TIRA and TRA have been very positive as they see that this innovation goes in line with the government vision of having 50 per cent of the population insured by 2028.

What are your immediate plans?

Bima Time now introduces bima voucher with three insurance categories including those that cost Sh200; 15,000 and 25,000. A Sh200 voucher insurance would be valid for three days that is, if a passenger died, Sh1 million insurance would be paid for the deceased and that if a passenger was involved in an accident and suffered permanent deformity, that passenger would be paid 25 per cent of the money, which is Sh250,000.

The Sh15,000 bima voucher is valid for six months, and if it happens the passenger with the bima voucher dies, his/her family will be paid Sh2.5 million.

And if that passenger got a permanent deformity, s/he will be paid Sh625, 000.

On the Sh25,000 bima voucher, if a passenger with that insurance died, his/her family would be paid Sh3 million and if that passenger suffered permanent deformity, s/he would be paid Sh750, 000.