This daily series focuses on business ideas for those looking to launch new ventures in Nigeria (and Africa in general). The short ideas are archived here.
The Nigerian insurance sector is on paralysis. Unlike banking, it continues to struggle to permeate into the lives of average Nigerians. Even the people that sell the products do not use them. That tells you the scale of the industry problem [ask any insurance worker if he has home insurance for his village house; the answer is possibly NO]. But there is always someone to blame: the customers do not support insurance as though there is anything like that. No one wakes up in the morning looking for a business to support. Rather, people look for businesses to solve their personal and commercial frictions. Any business that delivers solutions for those frictions would get paid. With low penetration and poor value proposition, the insurance problem is huge.
Interestingly, because the sector has not been redesigned means that opportunities abound. Though an insurance license is required to actually effect many changes, there are ways tech entrepreneurs can help insurance companies to use technology to improve service and advance the sector. By reducing the claim processing time even when improving the overall experience, insurers can make many people believers. Banks did that and got many people into the sector.
Claim assessment takes more than 12% of the global auto insurance premium, according to Fintech Collective. By using technology in that space, the insurers can easily evaluate the damages and pay timely. This will help its value proposition and possibly make it more appealing to customers. Today, insurance claims in Nigeria take months and customers just give up. Technology can speed up that process and help bring confidence in the industry.
Create a product I will call FasLoci to make it easier to explain.
Name of project: FasLoci
Description of technology: FasLoci is a high-end geo-location data collection and management suite which encompasses a mobile application for crowdsourcing geo-location data, remote datacenters for data repository and a web service for content management. It will work in any location and can be configured to support any insurance company.
Application: What FasLoci does is to aggregate photos as they are being taken, tag them with GPS location, and then send them to a repository server where they can be sorted. It offers to clients a technology that will help them associate any photo with its GPS location. The applications are enormous – retailing logistics, insurance claims investigations, trust system in farming, etc.
Take for example an insurance company asking its clients to download the apps and use that to take photos after accidents. They take the photos from their phones which immediately are synchronized to the insurance server. The insurer will look at the photos and compare the report from the Police where available. If they match the location where the Police have described, the insurer will know the photos are legitimate. They do not have to travel from Port Harcourt to Opopo just to gather data. [This is the idea which I explained in details with technical features and structure here].