Please use this identifier to cite or link to this item: https://doi.org/10.21256/zhaw-24569
Publication type: Bachelor thesis
Title: Distribution channels in the East African microinsurance market
Authors: Keller, Deborah
Advisors / Reviewers: Barth, Sebastian
DOI: 10.21256/zhaw-24569
Extent: 127
Issue Date: 2021
Publisher / Ed. Institution: ZHAW Zürcher Hochschule für Angewandte Wissenschaften
Publisher / Ed. Institution: Winterthur
Language: English
Subject (DDC): 332.38: Insurances
Abstract: Low-income people in developing countries, who are the most vulnerable and particularly exposed to risks in their daily life such as diseases or drought, often have no access to formal insurance – although they need it the most. The concept of microinsurance is a solution to help mitigating the vicious cycle of poverty, while also offering insurance companies an opportunity for strategic market expansion in this vast untapped market. In the African microinsurance market, a share of only 2-6% of the low- and middle-income population is covered by a microinsurance policy. The objective of this thesis was to evaluate distribution channels with the potential to promote microinsurance products in the East African market based on selected supply-and-demand side criteria and taking into consideration economic, financial and social factors. Thereby, this study followed a qualitative approach that included both secondary and primary research, the latter being conducted in the form of four semi-structured expert interviews. It was identified that the microinsurance market is still in its infancy and the challenges are various. The low-income target groups have continued negative perceptions of insurance companies and their products. They consequently have a lack of trust in them and see limited value in it. This is compounded by low financial literacy rates of the target customers and insurers have limited access to potential customers as urbanization rates are low. Therefore, facing these challenges, insurance companies rely mainly on distribution channels that provide direct, personal and broad access to these low-income individuals. Especially the distribution of products through cooperatives and community-organizations is a valuable option because trust, transparency and sustainability are ensured. Furthermore, it is crucial to embed the insurance product into the business of distributors such as microfinance institutions and retail stores to integrate insurance further into these low-income population’s life. Mobile Network Operators, which are widely known and used in the market on a daily basis, represent a promising option for the future if the issue of simplicity of the products is further solved. Nevertheless, additional capacity building in the form of trainings, information campaigns using simple pictures is essential to overcome the aforementioned issues and to enhance financial literacy and trust in the East African market. Digital platforms, evolving in Africa at high growth rates, have an important impact on the further development of microinsurance distribution. The integration of technology-based tools to develop the microinsurance market is a viable opportunity for insurance companies to facilitate processes, scale the business and reach more customers even in rural areas while optimizing the distribution costs. An interesting focus for further research is therefore the integration of Artificial Intelligence and Big Data and as a result new business models such as index-based insurance or on-demand insurance to further penetrate and develop the microinsurance market.
URI: https://digitalcollection.zhaw.ch/handle/11475/24569
License (according to publishing contract): CC BY-NC-ND 4.0: Attribution - Non commercial - No derivatives 4.0 International
Departement: School of Management and Law
Appears in collections:BSc International Management

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Keller, D. (2021). Distribution channels in the East African microinsurance market [Bachelor’s thesis, ZHAW Zürcher Hochschule für Angewandte Wissenschaften]. https://doi.org/10.21256/zhaw-24569
Keller, D. (2021) Distribution channels in the East African microinsurance market. Bachelor’s thesis. ZHAW Zürcher Hochschule für Angewandte Wissenschaften. Available at: https://doi.org/10.21256/zhaw-24569.
D. Keller, “Distribution channels in the East African microinsurance market,” Bachelor’s thesis, ZHAW Zürcher Hochschule für Angewandte Wissenschaften, Winterthur, 2021. doi: 10.21256/zhaw-24569.
KELLER, Deborah, 2021. Distribution channels in the East African microinsurance market. Bachelor’s thesis. Winterthur: ZHAW Zürcher Hochschule für Angewandte Wissenschaften
Keller, Deborah. 2021. “Distribution Channels in the East African Microinsurance Market.” Bachelor’s thesis, Winterthur: ZHAW Zürcher Hochschule für Angewandte Wissenschaften. https://doi.org/10.21256/zhaw-24569.
Keller, Deborah. Distribution Channels in the East African Microinsurance Market. ZHAW Zürcher Hochschule für Angewandte Wissenschaften, 2021, https://doi.org/10.21256/zhaw-24569.


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