Subscribe
Share
Share
Embed
In Africa, less than 3% of people have an insurance safety net. Amee Parbhoo talks with Jihan Abass, Founder and CEO of Lami, to discuss how digitizing insurance bridges this gap.
Fintech has the power to build a more inclusive world. Fintech for the People is about the innovators who are developing fintech solutions that reach the people who’ve been left behind. In each episode, we’ll hear from innovators who are creating financial solutions that bring every person the financial tools they need to grow their business, support their family, and build their community. Together, we’ll learn how fintech looks different in spaces and places where basic financial services are a luxury — and how solutions to address these challenges require a different level of creativity, empathy, and execution.
Fintech for the People is an Accion podcast hosted by Amee Parbhoo, Managing Partner of Accion Venture Lab – an early-stage investor in inclusive fintech startups. Learn more about Accion Venture Lab here. Episodes will be released in seasons, on a weekly schedule.
Amee (00:13):
Hello, everyone. And welcome to the fourth episode of FinTech for the People. I'm your host Amee Parbhoo. This podcast is produced by Accion Venture Lab, an early stage investor and inclusive FinTech companies, working globally. So far, we've showcased three women founders disrupting the financial services industry. They are building solutions for small businesses in Brazil, educational institutions in India and even food trucks in the US. This week, we'll head to Kenya to chat with Jihan Abass, the founder and CEO of Lami. Lami is an insurance as a service platform that enables any business to develop and sell insurance tailored to their customers needs. Jihan, it's great to have you with us today.
Jihan (00:58):
Yeah. Thank you so much for having me.
Amee (01:00):
Great. Well, before we dig into what you're building at Lami, tell us more about your story. How did you end up an entrepreneur, is that something you always envisioned?
Jihan (01:09):
So actually, my background is completely different. I started off my career working in finance so I worked actually, as commodities futures trader which is a completely different career path. But then I started to get really excited about the insurance space and in terms of entrepreneurship, I think it was always something that I felt that I would end up doing. I come from a family of entrepreneurs, my father, my grandfather, both entrepreneurs. So I spent a lot of time with them at their offices, seeing what they're doing and all of that. I think that got me really excited and building something of your own was what I think, was driving me. And then I guess, the idea of insurance coincided with that at the perfect time.
Amee (01:54):
And what about insurance drew you?
Jihan (01:56):
So it was actually, a very random encounter that got me thinking about the insurance space. I'm actually, from the coast in Kenya so I went back home for holidays and I was speaking to a waiter who told me he didn't have medical insurance. And I was pretty surprised because I thought people with more structured jobs have access to insurance products. But when I went back and did research the statistics were really shocking, less than 3% of people in Africa buy insurance products and it's even less in some African countries. And when I assessed the Kenyan market in particular, there's more than 50 insurance companies that operate. So I didn't really understand why there was such a huge gap between the number of providers and actually, the people who were buying these products. And I think upon assessing further it seemed that actually, there was really no infrastructure to facilitate the easy and simple distribution of insurance products. So although people might want to buy insurance product they don't really trust the system, they don't trust the processes because they were actually, broken.
Amee (03:00):
And so tell us more about then what Lami does to solve that problem.
Jihan (03:05):
Yeah. So Lami is an insurance as a service platform and API, we digitized the whole value chain. So from KYC, pricing, underwriting and claims processing are all in a platform in API that partners are able to use to create and distribute digital insurance products. We started off actually, in the market with one product which was a car insurance app and felt that was an easy way to assess the market and actually, have a way into the market because everybody in Kenya was familiar with car insurance they purchased it and we wanted to make that customer journey simple and easy. So we took a car insurance product that used to take about two to three weeks to get a quote and buy a policy but now we slimmed that down to less than two minutes. And I think that was a really exciting way to showcase what's possible with technology for the insurance space. And then from there, we pivoted actually, to providing our technology to businesses, to be able to plug in our insurance products into their customer journeys and interfaces.
Amee (04:06):
Was that always the plan to go through platforms? It's interesting Lami's history, you started with this direct to consumer car insurance product and business model. And now you're at... And as a service business working with platforms all over the country, was that always the plan?
Jihan (04:25):
I would say yes and no. I think it became clear as time passed because we started to get a lot of requests for our technology. And that's when we realized actually, this is a huge opportunity for us to enable businesses as well. And I think one of the key things, the reason why plugging into other platforms makes a lot of sense is because of the problem that we're trying to solve. We're trying to increase accessibility to insurance products and if you're going to do that with a B2C product, it's going to take you a very long time to have the level of impact that we wanted to have. And using our technology seems like the easier way to access these markets.
Amee (05:05):
So maybe you could walk us through, I mean, you gave the example of the inspiration, this waiter that you spoke to, who didn't have access to medical insurance, how would he be able to gain access to insurance through Lami, now? What is that end customer experience like?
Jihan (05:25):
So we wanted to really leverage the trust that had already been built with other platforms. So plugging into platforms that people are using on a day to day basis and then making relevant products available through those channels so maybe I can give some examples. So we tried to work with use cases so we take a combination of an insurance product and a distribution channel and then we mesh those together. So one example of a product that we're recently launching is a combination of medical and also retailer insurance covers. And we saw a big gap particularly, on e-commerce platforms, whereby they have hundreds of thousands of merchants but they're not providing relevant products to help these merchants protect themselves or protect their goods from all sorts of risks. So we saw that as a really exciting opportunity to partner with these kinds of e-commerce platforms to be able to plug in these kinds of products. And that's one of the really interesting products that we worked on last year.
Jihan (06:21):
Another example that we have is for e-logistics platform so for example, we work with Sendy. We wanted to provide them a flexible and affordable product for the goods that are being moved on their platform. So this product didn't exist so we went through the process of actually, creating the product with the insurance company. This is a per trip goods in transit policy that covers the goods as they're being moved. It's the first of it's kind to be sold on a per trip basis in real time. So we've plugged that into the Sendy platform and for the truck owner or the owner of the goods, the process is completely seamless because they're not asked any questions. We take the information from the Sendy platform about the goods, the distance that the goods are traveling and the destination and we're able to price the product in real time and offer the policy. And I think that's the most exciting thing about what we do is that we are really looking into platforms that have insurance needs, people who insurance would provide them a great safety net and plugging those in a digital way.
Amee (07:17):
And also making them just so contextual. I feel like a lot of the challenge we've seen, I'd love to hear your experience here, but is the willingness to pay and the understanding of insurance is still quite low. And so being able to contextualize it, make it per trip, make it very tangible with what the end customer is looking at or the end recipient is so powerful.
Jihan (07:42):
Yeah. And I think one of the issues in the past with the insurance companies in particular, is really the products they're designing for the circumstances in terms of risk has really changed. But however, they're still looking at assessing the risk in the same way but when you're plugging a product into a digital platform, the risk completely changes and the parameters around that. So for us, it's really exciting to be able to get insurance companies, to start looking at things in a different way and also for end customers to provide them with products without any friction whatsoever in the process.
Amee (08:16):
So one thing it's clear you work across a number of different types of insurance products and a different types of partners, e-commerce, e-logistics. I'm curious, how do you go about launching a new product, what is that process like for you?
Jihan (08:33):
So sometimes the product doesn't exist so we spend a lot of time trying to convince insurance companies to create the product with us. In some instances, we also work with reinsurance companies to design these kinds of new age products. And once we've understood the customer journey and also the needs of these digital platforms, we can customize the products to meet those needs. And then the really cool part is when it goes to our IT team and we are able to actually, take this product and publish an API that matches the parameters of the product. And at that point for these digital platforms, it's only a matter of weeks before they're able to integrate and actually, launch the product. So it's a pretty short process and one of the things launched towards the end of last year is these really intricate dashboards where you're able to actually, monitor the performance of these specific products how they're performing, how the sales tracking and can even assess the customer journey and see where would be most effective to have this product placed as well.
Jihan (09:33):
So that's something that is really exciting for these digital platforms because they can even make changes with the products. So if they want to change the price, if they want to change some of the cover, the benefits of the product as well, they're able to do that just through the dashboard. And I guess, one of the key things is really about the awareness because if products are embedded it comes with a good or service that you're buying. So for us, it's really important to be able to work with the partner that we have, to be able to ensure that people actually, know about the product, they know how they can file claims, they get all the relevant information about the benefits so that the process is super easy for them as well.
Amee (10:09):
What is it that you do working with your platform partners to help customers better understand how these insurance products work, making sure they're taking advantage of it, if it is truly embedded in what they're doing and make sure it's part of their financial journey?
Jihan (10:25):
Yeah. I would say that the first thing we try to do with all our products is really just eliminate all the lingo, the complex language around insurance and simplify that in two terms that people understand, the average person can read and understand. So we try to do that with all our products because our platform will also issue policy documents and all the cover notes with the policy. So we try to make those summaries just a couple of paragraphs that somebody can read and understand, they can understand their benefits because even when it comes time to claim against the policy, one of the key reasons why insurance companies decline claims is really because the claims are being filed against benefits that were not there or limits that are too low, for example. So we try to make those aspects super clear as well.
Jihan (11:09):
And also for the claims journey, what we do is we try to match specific claims, the questions for only specific items. So instead of having to file a claim for everything which is how it is nowadays, traditionally you'd have to fill probably, four or five pages of claims. We've slimmed that down to only a specific claim. So if you have a windshield damage, for example, on your car, we will only give you the three questions required for that as opposed to you having to fill the other data. So we try to also add that component with all our products.
Amee (11:38):
Yeah. So simplifying so much of what there is to even understand helps with that customer journey. I want to turn next to then the platform partners which you've talked a lot about and just the variety of partners. You need to work with the stakeholders to make what you do successful, enterprises, these platforms, the insurers, reinsures, what has been your experience working across the spectrum of partners to better serve the insurance market?
Jihan (12:07):
There's definitely, been a lot of learnings in the past year. We have been doing B2B and B2BC products. I think one of the key things that we noticed is really the shift in the mindset of insurance companies. So since the pandemic insurance companies have completely changed how they view digital platforms as a distribution channel for themselves. So previously, they really were heavily reliant on agent models and branch outlets and so on but now they're really getting excited about these kinds of distribution channels. So actually, we've been able to integrate a very large number of insurance companies because of that in the past year in particular. I think when it comes to banks, I would say that banks here probably, are earlier adopters because actually, our first B2B sales was with a bank. They were the first to actually, see the value and what it was that we were providing.
Jihan (12:56):
And I think one of the key lessons from that was really the, during that process of onboarding a office bank, I think was really around the security aspect. So how are we ensuring that our platform is secure, the customer's data is secure at whole times. And I think that was a really interesting learning for us because we actually, built our platform based on that feedback that we got. And we were able to ensure that now, our platform is compliant with GDPR and all these ISO certifications for data security.
Jihan (13:25):
And I think when it comes to digital platforms, I would say that the most exciting part about it is that each digital platform and each sector has a completely different customer journey. So for us, that was a super interesting challenge because it meant that we had to go back and assess for our API, how can we ensure that it's standardized and that we don't have to continue making these huge changes to be able to accommodate all these kinds of different journeys and use cases and so on and I think that was super exciting. So last year, there was a lot of learning for us and how we are able to actually, scale up our platform and ensure that it's actually, solving the right problems in the right way.
Amee (14:03):
That's great. I'd love to hear what your vision is, what does Lami look like in three years, in five years in the long term?
Jihan (14:11):
I think for us, it's really about being the leader in digital distribution of insurance. We were lucky enough to probably, be one of the few businesses that we're approaching insurance in this way. So I think making sure that we are able to continue scaling up and onboarding more partners and creating more exciting use cases as well and uses of our technology is really the key thing. I think one area that we are really excited about is around agents, how can we empower agents in and brokers as well by providing them solutions to tackle their problems as well? So we are really looking at how we can actually, dominate the insurance space and continue to grow and ensure that we are available for all partners across Africa. We get a lot of requests in some markets but we're not yet there so for us, it's really about making sure we can serve all these customers.
Amee (14:56):
Lastly, we know that while diverse teams outperform only a sliver of overall venture capital funding is invested in women-led companies, this is definitely, been the case in Africa. What do you think it'll take to bridge that gap, both for investors and for founders?
Jihan (15:15):
I think for founders, I think one of the key areas is really that mentorship is a key part. I don't think we do enough of that, mentoring young women and young girls to actually, show them that entrepreneurship is actually, a viable option as a career path for them. I think for me, I was really lucky to have grown up seeing entrepreneurship my whole life. So it was very simple and easy for me to make that choice but I think others are not as lucky and I think it's important for us to be able to start doing that. I think for investors, it's maybe looking beyond FinTech, I don't think there's a lack of female founders. I think there's just a lack of female founders particularly, in FinTech. So maybe looking at other areas or other sorts of industries could be a really exciting way to actually, invest in more women as well.
Amee (15:58):
And how about from the founder perspective, any advice for aspiring entrepreneurs out there?
Jihan (16:03):
Yeah. I think the only thing that I would say is really... Actually, two things. First is just, don't be afraid to do it. I think whatever happens, I would say that there's a lot to learn but in terms of building a business, I would say that the key thing is really just to understand the problem that you're solving. So take that time to really understand the problem that you're solving. The solution might change, I think for us as well, the solution changed over time but once you're able to understand the problem and spend time understanding the particulars of that, I think it really helps also as you build your business.
Amee (16:35):
Well, this has been a wonderful conversation. Thank you Jihan so much for the time and for sharing your story. Thanks again for being here.
Jihan (16:42):
Thank you very much for having me. It's been a really interesting discussion.
Amee (16:48):
Be sure to join us next week for the final episode of season one of FinTech for the People. We'll be chatting with Luz Borchardt, co-founder and vice president of marketing at Henry, which is expanding access to high quality technical education and improving the long term earning potential of its students across Latin America.
Speaker 3 (17:08):
We believe that while potentially is evenly distributed across society, opportunity is not. And our mission is to accelerate LATAM's transition to a more equal society by connecting people with high paying jobs.