Two African startups focused on insuretech have announced seed funding rounds over the past week. This shines a fresh light on a space that is poised to grow, driven by the same force driving much of the region’s fintechs startup investment. Unmet need.
A recent roundup in the Fintech Times, citing McKinsey data, estimates that Africa’s insurance market is worth $68 billion, as measured in gross total premiums. This compares with $157 billion in Latin America and $200 billion for Asia (excluding China). This gap suggests a sizable upside in Africa.
However, the continent remains largely under-insured. According to the Fintech Times report, even in South Africa, which accounts for 80% of the $68 billion, only 35% of the cars on the road are insured. McKinsey estimates Africa’s overall insurance penetration is just 3%.
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