Executive Summary
- Microinsurance products provide an opportunity for non-life insurers to expand their reach and foster financial inclusion in South Africa, given the country's prevalent income disparity.
- The success of the microinsurance model in South Africa is supported by factors such as high poverty rates, a favourable regulatory environment and consumer awareness of the importance of insurance
- Companies like Lumkani and Oyi Healthcare are leading the charge in providing affordable insurance policies for South Africans, driving the increased penetration of non-life insurance products in the country.
South Africa is one of the most unequal countries globally, with a Gini index score of 63% and a lower-middle poverty rate of 41% as of 2023. High poverty levels and income inequality have significantly hindered the growth of non-life insurance penetration, as affordability remains a major barrier for low-income earners.
Nevertheless, South Africa’s non-life insurance industry is projected to grow at a CAGR of 5.4%
