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Hollard Insurance

 
About the Project
Project Name: 
Short-Term (non-life) Voluntary Insurance
Type of Facility Project: 
Innovation Grant
Country of Operation: 
South Africa
Region: 
Africa
Project Thematic Focus: 
Product design
Product: 
Property
Type of Risk Carrier: 
regulated insurance company
Type of Distribution Channel: 
Bank
Retailer
Project Description: 

Hollard aims to learn how to deliver voluntary asset and other short term insurance to the poor. The proposed innovations include:

  • use of technology such as cell phones and global positioning system (GPS) to facilitate sales practices and reduce fraud;
  • creating a new cadre of inexpensive microinsurance claims assessors;
  • implementing creative market strategies for market education and brand awareness;
  • using innovative intermediaries like sellers of cell phone air time.

The project focuses on short-term insurance such as home and assets insurance, which is still virtually unavailable to low-income households in developing countries. Success with this product may encourage other insurers to launch pilot projects in this sector.

Beneficiaries: 

Expected target groups: low-income households in urban and rural areas not currently using short term insurance such as household insurance 
Expected outreach: 1 million clients within 10 years

 
Lessons from the Project
Learning Agenda: 
  • How does household and other short term insurance fit within a range of other risk-management needs and strategies by low-income households? What is the client value proposition?
  • What type of household and other short term insurance products are demanded? What is optimal coverage versus price?
  • What are cost-effective distribution channels, sales and customer loyalty strategies as well as claims administration in the microinsurance value chain?
  • What is role of technology within the value chain?
  • How can a private insurer get involved in education that serves both its own and consumers´ interests?
  • What are key differences between Small and medium-sized enterprises (SME) asset insurance and household insurance regarding all the aspects above?
Emerging Lessons: 
  • It is crucial to understanding your partners’ motivation in agreeing to distribute your product, especially in an instance where they have limited insurance experience or interests.
  • A partner with insurance experience/expertise is more likely to commit to a higher level of involvement and longer term engagement.
  • It is important to recognize, and plan for, the fact that a partner’s core business will always remain their priority. Shift in core business demands and pressures will draw from the partners’ attention and available resources.
  • There is a need to ensure that proper system pre-launch audits are undertaken
  • There is a need to identify and secure resource availability for product launch (IT, actuarial, business unit and other supporting functions) as well as engage all stakeholders impacted by the project.
  • The need to identify all stakeholders (both internal and external) and engaging with these stakeholders from the commencement of the project cannot be overstated.
  • Operational staff plays a possibly vital role in identifying potential pitfalls in the design of the project due to their daily involvement with systems as well as external clients
  • There is a need to document learnings internally. Extensive knowledge exists within the organization; however, it has not been properly documented.
  • The Hollard experience to date has shown that a very effective way of reaching audiences is to involve them in an energetic performance through industrial theatre versus lecture-style teaching.
  • The need for an improved, more accurate management account report for the JET channel was identified.
Learning Journey: 
Learn more about the lessons that Hollard Insurance is learning in this project.
 
About the Organization
Relationship with the Facility: 
Innovation grantee
Country of Head Office: 
South Africa
Region : 
Africa
Type of institution : 
Insurance industry
Participation in Microinsurance: 
Risk carrier
Organizational Overview: 

Hollard Insurance, a family-owned group, is the South Africa´s largest private insurance company. Active for twenty-seven years, it has 1,300 brokers providing both short-term and life insurance services to more than 6 million policyholders in South Africa and abroad.

 
More about the Organization
Websites: 
Hollard Insurance
Marketing and other materials : 
Hollard insurance microinsurance profile (pdf 461 KB)
Quotes: 

“We see the partnership with the ILO Microinsurance Innovation Facility as an exciting opportunity to learn faster in order to drive effective access to the lower income market, in a way that is good for the clients, good for our partners and, of course, good for business’ 

Jeremy Leach, Principal: Micro-Insurance, Hollard Insurance Group

“Building trust between Insurers and their customers is key to successfully serving the low income markets, and together with the Facility we hope to find an efficient and innovative way to better service this market’ 
Bipin Bhagwan, Assistant Principal: Micro-Insurance, Hollard Insurance Group

“Hollard has already achieved considerable success in the micro-insurance segment. We will continue our focus on developing unique insights into the needs of the low income market, and will design innovative and relevant product and distribution solutions that take insurance into the customer´s comfort zone. We have demonstrated that these solutions must be affordable, easy to understand, conveniently accessible, and must represent good value for money if they are to be sustainable. Consumer education must underpin our efforts to expand the potential market.’ 
Nic Kohler, Group CEO: Hollard Insurance Group