E29: Insurance & Tech Innovation on the African Continent. A Conversation with Damola Oloko

In Peter Thiel’s book Zero to One, Peter talks about how during the modernization of China, as they copied and pasted technologies from the Western world, they were able to leap over many of our legacy technologies and skip to our modern ones, like skipping landline communications and directly installing digital mobile infrastructures. This seems quite similar to what insurance and technology are doing in Africa. In this episode, I spoke with Damola Oloko, host of the Insurtech Business Series. We discussed companies in his homeland of Nigeria and others on the African continent who are leveraging technologies such as WhatsApp and Facebook Messenger to reach a growing young, educated, and tech-savvy population for targeted microinsurance products.

Watch here:

Connect:
Damola Oloko (LinkedIn)
Insurtech Business Series

Other Useful Links:
Casava (Homepage)
Comparisure (Blogpage)

Musical Credits:
Shadows by David Cutter Music:
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https://soundcloud.com/dcuttermusic
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Video Credits: Intro Stock Footage by Videvo

Transcript

Nick
And we're live! We're back with the Coverager Podcast. We're going to take a little bit different tact. A lot of the podcasts have been very centered around US, or North American style insurance or Insurtech. So we're going to break out of the mold. We're going to go international, and specifically, we're going to go to the African continent. Damola Oloko is my guest this week. Damola how are you?

Damola
I'm very well thank you. Thank you for having me.

Nick
It's a pleasure having you. So this will be a little bit new for me and I'm looking forward to being you know, he's somewhat gets stuck in our own little forest. So it'll be good to getting a perspective of what's going on outside of North America and outside of what's going on in, you know, London markets or European markets to see what's happening internationally and how insurance and technology and Insurtech a kind of combining in different parts of the world to solve other other problems that exist. So welcome, and I always start these particular interviews, Damola by giving you an the soapbox so to speak. So why don't you introduce yourself to the audience? Who are you and what do you do?

Damola
Okay, hi. So my name is Damola Oloko and convener of Insurtech Business Series. So Insurtech Business Series is a project that I started alongside a colleague of mine to basically ignite conversations around technology, innovation, and how they can bring opportunities to insurance, right, especially in the African continent and looking at Nigeria where I'm from. And so I work on that currently. And currently, I'm the co host on a podcast series, Insurtech Podcast Series. And basically what we do is to engage insurance professionals within and outside of the continent, outside of Nigeria, to hear you know, their thoughts or share their ideas about how technology, how innovation is what we can use to drive, you know, insurance, especially in Africa where, you know, there's not enough penetration of insurance, right. So, so that's basically what I am doing at the moment, I have experience working in the insurance industry, five plus years. And you know, so I, funny enough, I do have a background in insurance. So it's quite interesting how that has come up. And, you know, insurance has been interesting. So...

Nick
just go into that. Let's go with it to talk to us. Because you have your university and your advanced degrees are in media, not in insurance. So before, before we jump into your mission for the podcast and what you're trying to do on the ground there, why don't you talk about how you, the bridge, how you connected from being someone who has studied and focused on media, why insurance?

Damola
Yes, I get this question a lot. And it's a funny story, right? So myself and my colleague, talking about Alalrma Fulumi, and she's a co host on the podcast. We both studied communication right. At different schools, but we met during so in Nigeria, we usually have...so in our third year you do this industrial training where you are attached to a media company. And then you will learn, go to field reporting and just put your hands on deck. And that's how we met, you know, and this is 2011/2010-2011. And we have different schools. So after school and everything she had gone into the insurance industry as well. And then I started off by immediately I finished school, I went to do my masters. And afterwards, I mean, insurance came up, and I came into the industry and looking at it, so I went back when I started, he was just like, Okay, this is something I want to do for the meantime. Right? So I was in the agency business, right? And so I just looked at it I said, Hey, I can actually be doing this for doing sake. Right? I just thought okay, what exactly is it about insurance? So I started doing research, I looked online I said, Hey, this thing is actually very, very good for people. And so I looked at Okay, looking at the Nigerian area on Africa generally, why is it not as popular in this part of the world? And so that piqued my interest and I decided to go on to get professional certifications in insurance. I'm almost done with my insurance certification. The title insurance is still Nigeria professional program. And that really was give me ideas okay, now, how can I use my background in media and my current passion about insurance, and we'll match them and make some impact. You know, because I always like to wherever I find myself at least do something. I know something that would make an impact. And I said, Okay, why not to start a podcast? Right? And that's how I was able to look at it. I'm having a communications background. So talking is not the problem. And this is insurance where a lot of opportunities out there, so why not come and talk about it and look at it from the angle of how technology, you know, can help the industry to really grow. So that's how the whole thing came about.

Nick
That's, fantastic. In here, your I your first guest was Rob Galbraith.

Damola
Yes, amazing book.

Nick
Interesting, man and insurance.

Damola
Yes!

Nick
Guest number one made it to the African continent, which is just phenominal.

Damola
Amazing!

Nick
We're gonna work I want to get into the podcast and what your hopes and missions are, but you kind of hit on something that's very important. So, you know, across the world take up rate for insurance is, depending on the product isn't always very great. Even you know, here in the US in a very mature market largest market in the world we still, there a lot of sensitive products that have very, very poor take up. So it's a it's a problem that's sort of endemic in insurance, in a lot of different ways. So the question I have is in, maybe talk about the African continent, but specifically Nigeria, where you're from, what other types of exposures that you find that people might have, and why do you think the take up rate is so poor?

Damola
So I mean, to your point that you that you mean something that I found out when I started looking now, there are some things that are actually similar amongst, even in the African continent and in Europe and America. And it was quite interesting for me to find those because I usually I always thought that hey, these guys are way ahead yes and everything is put together, but I actually started to see that hey, we have some things in common and so, for for the for the for the African continent right and looking at Nigeria specifically. So, you see that apart from from that, yes, I mean, we are a developing nation right and the financial might of the average person is low. Right. So, that affects to a good extent insurance products that these people can afford. Right? So they the insurance broker out available in the market and not affordable for them and you also and that affects, you know, the way they you know, patronize insurance. Or another thing that affects the pattern in your insurance or optic is cultural beliefs or religious beliefs. Right. So, culture and religion is very much ingrained in Nigeria, it's huge, right? People believe their religious leaders a lot, a lot, whatever they say. And even the culture is still very much strong. So, so cultural beliefs and systems really hampered the take up of insurance for example, you got it's not easy to have an in-depth conversation with an average Nigerian, right so, do you want me to die? The first thing that they would ask you is, are you praying for me to die or you get I think this one says like, I will not die in Jesus name.

Nick
That's probably a tough conversation to have in any culture. Yes. You know, so it's very, very religious with would have a unusually high burden.

Damola
Yes. Yes. And and what what really has also spurred my interest in this part is the fact that so like I said, I was in the agency system, right. So I was on the ground, I was meeting the people, talking to them so, I understood where they're coming from because prior to joining insurance, I never dreamed or imagined like, Okay, this Well, I want to be the carrier, you know, and insurance was not a conversation I was really held in amongst family or even with friends or anyway, it's not like conversations I really have. And so when I had those conversations, I understood where they're coming from, but I also understood that you always also have them understand like, you actually need this thing. Why, because this is yes, your beliefs is this is why you think what those risks are actually there, for example, your parents will definitely pass on. Right? So you actually need a funeral insurance plan in place, right? Yes, you might not believe it, because maybe your religion or your culture, but your risk doesn't go away. You know. So part of what I did that, you know, was also helped in a way to educate people, hey, yes, you're not gonna take it, I'm not gonna force you. But let me educate you on this, I risk there will always be there. And what I've seen is that people are outspoken with first year joining the insurance industry or second year, fourth year, fifth year coming to me and saying, Hey, I remember I spoke to me about this thing. I heard it, then I wasn't ready then but, what is available for me to take off now? You know, so. So one thing that is very important is for us to want to, I mean, for the African continent, for Nigeria, specifically, the education has to be very huge. So and that's one way that that's people can.

Nick
So so you really you hit on something that I find that I've been a proponent of, you know, here in the US as well, which is the insurance industry itself has suffered for pretty much since the beginning like hundreds of years in the communication, right. There, there are probably very few people who would aside from those that are forced to buy it, readily are willing and able and want to...communications a big problem, right?

Damola
Yes.

Nick
So I think that's that I have always been encouraging of people in marketing, in media, in communications to come into insurance, because I'll raise my hand...we struggle with communicating the benefits of it. You know, for those of us that have been in it for a long time, it's just we sort of take it for granted. Did that it's like, okay, there is a market and we'll just sell into it. But it's actually not that easy. It, I don't think it matters where you are in the world. It's a difficult sell, because you're selling a promise. But also because there could be other factors like religion, like income, in a bit, you know, low income levels where they may not be able to afford the product. So, I'm curious, have you also in your, in your time where you've been able to help the agencies and now you're in the industry, help the industry perhaps, package up the communication? Do you have like other colleagues, other students, like do you recommend insurance as a career path because of the problems that we're having?

Damola
So one of the beautiful things that we're doing, not from me, but generally conversations have brought about is, and that's why I am a pro a support having conversation really is the fact that so insurance really has been how it is, like I said, it's not a conversation that people want to have in you know, what what has happened is so for example, in the secondary school level, you know, so, so the level before a university, right? So the insurance industry has really pushed for the insurance subject to be part of. And today you see a lot of a lot of students actually learning about insurance and so funny enough part of my question about getting this conversation out is, I looked at it that if we are going to actually change this industry, see how we can improve, we have to start having those conversations with those children. This this, this guy's from those level of education. And so I've been able to engage a couple of secondary schools, getting them a part of, so, I also, you know, through Insurtech Business Series partnered with IBM here in Africa, in Nigeria, to organize training sessions, so training sessions about artificial intelligence, blockchain, you know, and, and the likes...cloud. And those students are being a part of it. You know, so I have a rep who I, I talked with, and I told him, one of your students to be a part of this thing. They are insurance students who get them to be a part of it, learn how to, because by the time they're coming out, insurance, not gonna be the way it is today. And so they have to learn those new skills. So that conversation has gone in terms of education. Now what what is left for the industries they've tried it was, I mean, they've not gotten the formula, right, is to really push out fully to educate the populace in this, you know, about the benefits of insurance not just selling, Oh, this is this this product is for So, so years, this is the feature, but how can I been it, what's the value, you know, communicating the values, what's more important, and that's what Nigerian's buy.

Nick
Fantastic. To sort of piggyback on that you brought up product. And, you know, developing countries have a whole set of issues, but it also creates a particular opportunity, right, like, so for instance, there's probably we probably take it for granted, as well, because we've had for like auto and homeowners, Small Business, Business Insurance. We've had a mature market for so long. It's actually very difficult for technology penetrate. In developing country, the you cannot sell as you said, as you mentioned, you cannot sell the traditional products because the way that they're packaged up in other parts of the world because they're just too expensive, they're too elaborate for the risk that they're actually able, that these people actually need to consume. And so it seems to me there's a technological opportunity in developing nations because there has to be, it's the only way to basically drive down the cost and the expense. Yeah, you do to develop a for example, like micro insurance products. So, you know, instead of these very elaborate auto policies or very elaborate funeral expense or life insurance policies, something more bite size, which mean smaller value, higher transaction type thing where technology can be a huge advantage that we just might take for granted here in the States. Can you talk about the link between technology and potentially product development in a developing nation?

Damola
Yeah. So. So this is part of the reasons why, I mean, I started this project, the Insurtech Business Series, right? Because, I mean, like I said, I looked at what is happening in other parts of the world, Asia, Europe, America, and I looked at what's happening here, I saw that yes, we can't copy and paste right, because our suspicions are different. And walk our walk here, like you mentioned is microinsurance, creating new productivity products and using technology as a means of distributions, you know, in order to bring down the acquisition cost, you know, so. So, we are actually seen a number of innovations and and insurtechs you know coming into play in Nigeria and even across across Africa. So for example, in Nigeria, you have a microinsurance company that selling job loss insurance, just job loss insurance via WhatsApp. Right. So no agent, but

Nick
can you describe that, because that that would be that's extremely interesting. I don't know how much of the details, you know, but could you kind of talk to the audience specifically about that product? Because that's different, right? Like they're, for something like that. They can go directly to the consumer, but they can piggyback off of traditional technology that we're all accustomed to, to really streamline and optimize the process. Can you talk about that specific product? In a little bit that you know about it?

Damola
Yeah, so I know. So I've been in, in forums. Where the founder of the company is called Cassava has been in and so they have a so prior to launch right they had a waiting list of over 17,000 people via website right and we are planning to sell job loss insurance via WhatsApp leveraging artificial intelligence and paying claims by WhatsApp, getting your policy documents via WhatsApp, everything, you know, easy, and you see that it's a perfect thing for them. Why? Because a developing nation right? People lose their jobs and this cover, comes in handy, in providing some level of income because you losing a job getting another one is quite difficult, but at least for the meantime, you're able to get some funds to take care of the family, you know, to survive. So it's a valuable thing for for any professional work in any way. I say no, let me have this in the back of my, at the back. And it's taking away the complexity of "ok yeah I'm going to an insurance company or I have to speak to someone, all I need to do is I chat normally on WhatsApp, I just click on that company and I chat with them normally, I say I want to buy this and I'm covered. You know, so so is one of the interesting microinsurance companies that are coming out of Nigeria, and it's one that we are watching out for.

Nick
Yeah, it just so interesting, right? Because I've never heard of anything like that. And so, but it's so simple, right? So simple. So streamlined and piggybacking on very common and inexpensive tools that already exist, right. It's lessons that more of the you know, the developed countries can learn from you knowing, knowing that there's that these it's, we struggle here, right? There's always, in these more mature markets, it's always like, Oh, it's so expensive to acquire new customers. But we, we use very expensive means to acquire them. And here's now here's a story from a developing nation where it's just like, they're just using WhatsApp, something that everybody is using. And it just seems so simple. But we have to no one's really thinking of it in that particular way. It sort of reminds me of a story I read in a book, when, you know, China was going through their modernization, going from undeveloped to developed, and they were copying a lot of technologies that the Western nations had, and when it got to communication, they decided well, we'll just skip over the landline, we don't need the landline, we'll just go right to mobile. Right? Because they could. Right. And then that created a huge advantage for them because they don't have the legacy. Right? That's what I see with when and you know, I think it's really a really unique opportunity for a lot of mature companies, global insurance companies to go to developing nations, because they can skip over the legacy and go right to like real boots on the ground product development. Are there other any other sorts of companies or technologies...you did mention blockchain? I don't know if you know, any other that are being used, but any companies or technologies that we should keep an eye on as well? That's that that could sort of bring something new to the table.

Damola
Okay, so through Insurtech Business Series, like I said, we engage people from within Nigeria and also outside of Nigeria, in Africa and then, you know, internationally, and I came across a startup, Comparisure, it's been in South Africa, right? And they sell funeral insurance. Now they sell funeral insurance via Facebook Messenger. Right, so a lot of people in developing nations on Facebook, right, Facebook is still very popular, especially with the older generation...the millennials, the Gen Z, what's up Tick tock, Instagram, you know, and like, but you still see a lot of presence on Facebook, you know, and they're leveraging that to sell funeral insurance. And it's quite interesting, you know, because funeral insurance is, 1. it's not it's not it's not an easy conversation to have with someone is so come and buy this, right and so that taking that conversation away from Okay, let's take it virtually to where you are comfortable. And so Okay, why not buy out I'm in Nigeria and having been with them and I went to I actually tried to get a quote for myself, right and it was easy, I just supplied my details, my age so much that I needed and it was from supply getting information and I'll compare that to so that the insurance companies here in Nigeria for example that sell life insurance and funeral insurance and I have sold the funeral insurance and I see how long it takes right to onboard the customer and what is involved. I compare that to what I experienced with Comparisure and I say what was Are we not seen in all of this? Why are we not jumping in love with this thing? And so that's why I think that conversations need to go out because that's where it starts, you know, as you know, insurance is slow to change, right? They're sluggish to any likely to be as positive, you know, so but at this point, especially with the pandemic, things have to change. Things have to change.

Nick
Yeah, completely. What is your hope and mission for the podcast?

Damola
Yeah, so. So firstly, shout out to Rob Galbraith he was amazing. I met him through LinkedIn. Right. And I mean, I've been very grateful to LinkedIn because I've been able to meet a lot of people, met you met you via Gilad, through LinkedIn as well. And so I met him. I read his book. So I spoke to him on LinkedIn method. He sent me his book, autographed copy, and was very interesting. And he opened my mind to a lot of things. It's rarely seen how it's done there and how they've always done really developed insurance. And I am really grateful for him for being our first guest. And so, the main idea behind the podcast is to, like I said before, you know, encourage conversations around how technology and innovation push, you know, the insurance industry to the next level, you know, to encourage, to ignite conversations around the opportunities that technology would bring to the industry, especially in Nigeria, you know, because we are also looking at a situation where we are pushing a lot more financial inclusion, right the a lot of people around banks, right. So, insurance fits into all of that perfectly. Why because you can also help people, you know, to come into the to the that bracket as well. So in Nigeria, we have a large population in the informal sector, right? So, how can we use technology using a vision to create products, not straightjacket products that yes, car insurance, you know, this is a because why not create products, user based product, you know, create products, where, you know, the common man can buy, they can relate to, you know, something that he doesn't see I said, "Oh, this one is for the rich people", you know, so using innovation and technology to really go in and so that's, that came up and that's the conversation I want to have engaging industry professionals, regulators, and seeing how we can get this thing off the ground because the perfect time like you mentioned, we don't have to the other thing that we can skip, so is a perfect opportunity. There are a lot of opportunity, because the level of penetration is quite low. So technology can actually help us have that.

Nick
What are some of the demographics of Nigeria. Population?

Damola
So we're about 200 million.

Nick
Okay. So huge, huge population one of the bigger, I think it's the isn't the biggest country in Africa?

Damola
Yes, yes. Yeah. Most populated country in Africa.

Nick
Like other countries...is Nigeria, very young? In its in its weighting like there's a almost like a there was a population boom. And there's a there's a lot of young, like your 200 million is very skewed young, correct?

Damola
Yes, yes. Yes. A lot of young people, a lot of young people and a growing middle class. Yeah.

Nick
A growing middle class. So it's got all of the dynamics you will want to see in a market very large population, young and from what I understand too, so in your you're getting to like where I want to go educated, like interested in education, educated, and probably learning a lot of the you said making new products, probably learning a lot of entrepreneurial tricks and technology themselves. Would you say that the young population is very interested in technology?

Damola
Yes, Yes, they are. And you see now that a lot of that those younger population, so yes, at the moment, the level of unemployment is quite high. Right. But looking at SMEs that are run by a lot of young people, and Nigerians are very entrepreneurial, you know, you call it hustle, right here and so, you always there's always a business to be done. You know, you're selling something, learn to leverage a lot of social media, Twitter, Instagram, especially, selling hair products. Selling hair extensions, you know, you know, selling a lot of listing event and event money guys, and you know, and things like that. So it's a young population. Like I said, a lot of people are enterpreneurs, you know, so creating products, you know, and helping them to see that hey Yes, you're an enterpreneur. You don't work in the pharma sector. So to say, right, but you have risks that insurance can actually help you to do now, what you're seeing in the market is not fit for them. So that's where insurtechs can help you. Let's now innovate and say, okay, yes, these are things that are parallel to this set of people. Let's create a product around them because they have risks. And so we can provide some some cover for them. And it's quite interesting how how that is. about them. We had conversations around, you know, prior to now there's no, there's no cover around cybersecurity liabilities. So conversations around that is coming up. And so those are things that are coming around. And I mean, conversations need to go out and see how innovation can create new opportunities.

Nick
Yeah. Now, I mean, it's got it's got the all of the recipe for success. I just, it excites me when I see young populations, with all the technology that we have your WhatsApp stories is phenomenal. You know, being able to basically do everything through that platform. It is, it is a great springboard, right. It's a great springboard to reduce unemployment. If you get it. Were there. The entrepreneurial spirits can kind of take over but the technology exists for them to do it inexpensively. They get companies up and running and selling stuff cheaply. That that makes them that's a big difference because they're now we're reducing a lot of the hurdles and burdens on them to do that, you know, insurance is a little bit more complex, but like, but the more that entrepreneurial people are able to create products and start selling them, like you said, that creates opportunity for cyber insurance SME insuring, like just create a whole bunch of other stuff that comes along and which is why insurance exists. So yeah. Damola It's been a wonderful conversation. I I learned a lot. I will for those that are listening. If you want to connect to Damola or his podcast, I will put links to both of those on the show notes. So go to the show notes. If you want to connect, if you want to get the transcript of this particular episode, please subscribe to our podcast. Please subscribe to Damola's podcast. And Damola Oloko thank you so much for giving us a glimpse on how global insurance can improve by watching what happens in the in the developing world.

Damola
Yeah, thank you very much, really appreciate it. And great job you're doing with Coverager. And it's amazing. I mean, I am proud to meeting you have really followed Coverager a bit and I it's been interesting and some of the things I have learnt I want to take up as well. So yeah...

Nick
You're welcome. And the honor for having you on this podcast is all mine. So thank you so much.

Damola
Thank you

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