Insurance APIs enable data flow into and across the insurance value chain opening up the industry to huge opportunities for new and innovative solutions 

We generally tend to get caught up in the hype around certain technology. But we forget what it is that that technology brings to the insurance industry in terms of capabilities. Technology ideally brings four core capabilities to insurance companies; ability to collect data, transmit data, process data and present data.

Any technology can be looked at as providing either one or more of these capabilities. For example, Internet of Things (IoT) technology provides the ability to collect and transmit data. One  key technology gaining prominence within the African insurance space is API (Application Programming Interface). The growing interest in APIs stems from its ability to enable all these capabilities and so much more. With this realization, insurers on the continent are now willing to enable new integrations via APIs to promote innovation or new digital experiences and facilitate third-party developers and partnerships.

In our work and interactions with insurers from across Africa, we hear many reasons why insurers want to implement APIs within their organizations. Out of all the reasons, we have identified 3 key business drivers that are influencing API adoption and initiatives:

1. Improve the Customer Experience 

Customer experience has become a top strategic priority for most African insurers as policy holders demand friction-free multi-channel access to insurance products. Insurers are starting to expose open APIs to facilitate seamless omni-channel engagements with customers across various channels – web, mobile, agent, phone, social media – or devices – smartphone, tablet, PC. Through APIs, insurers see an opportunity to delight their customers through consistency and convenience. APIs achieve this by eliminating unnecessary tasks like re-keying data or the need to provide the same information at every new touch point i.e. agent, app, branch office/banking hall etc.

Some of the use cases we are seeing in the personal lines business are:

• Insurers are using API’s to allow internal development teams or third parties to integrate into core platforms for example creating unique mobile or web portals that capture their custom journeys and look and feel.
• They are also offering API’s to third parties to create new applications, mobile apps and related services propositions.
• Lastly, we see them using API’s to extend into new distribution channels for example through Agencies, banks and retailers.

In commercial lines, where cross-organizational processing is exclusively done by email and excel, we have seen insurers using API technology to reduce complexity and broaden connectivity towards richer and larger ecosystems. They have started offering external facing APIs that allow exchange of risk data and insurance servicing data with brokers and bancassurers.

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2. Increase Operational Efficiency 

In an ever-evolving business landscape, African Insurers are under pressure to improve efficiency and accelerate innovation. We have encountered use cases in the African insurance market where APIs are being used to streamline insurance processes like quotations, agent/client onboarding, underwriting, claims management and payments by creating connectivity and facilitating interactions across applications and systems.

Local insurers are using APIs to access data that exists outside their organizations to enrich their risk assessment capability and ensure accuracy in their pricing of policies. Some of the use cases we are seeing across Africa are:

Insurance-Government Integrations

African motor insurers are now able to integrate directly into government motor vehicle department systems i.e. NTSA TIMS for Kenya, RTSA for Zambia and NIID for Nigeria to facilitate the exchange of relevant motor vehicle information and validate motor risk data. This is critical for insurers who need to validate information more efficiently and identify potential fraud to prevent revenue leakage

Insurance Industry Integrations

In Kenya and Cote d’ivoire, motor insurers are now able to integrate into the Association of Kenya Insurer’s (AKI) Digital Motor Vehicle Insurance Certificate (DMVIC) system/Association des Sociétés d’Assurance de Côte d’Ivoire to order, generate and distribute virtual motor insurance certificates to their customers. This helps streamline the entire motor insurance process from the underwriting, to policy issuance and even to claims processing should a claim be incurred.

Insurance – Payment Solution Integrations

With the proliferation of different payment providers across the African Market. Insurers have invested a lot in APIs to simplify payments by allowing third-party billing solutions to integrate directly into their solutions. Through APIs insurers can enable multiple payment options including credit, debit, mobile wallets making the process quicker and simpler. The current crop of APIs that insurers have integrated with fall into two broad categories; Collection of majorly premium and Outgoing payments to policyholders, agents and service providers. Some of the popular Payment providers are; Interswitch, Remitta, PayStack, Jenga Pay, PesaPal, Mpesa and Pesalink. For those that have successfully integrated we see them eliminating challenges with premium allocation which is arguably the biggest headache especially in life insurance companies.

APIs in Africa

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3. Creating New Business Models & Ecosystems

Insurance is increasingly becoming about who can best leverage existing ecosystems. What this means for African Insurers is that they need to understand ecosystems and their role in them. What we are seeing in the African market is most insurers are becoming modular producers where they are creating plug and play products/services that can be adopted to any ecosystem while at the same time constantly innovating on the types of products and services they offer. In ecosystems and Partnership insurers are using API’s to enable data to flow seamlessly in real time between partner platforms and the Insurer core platforms.

Some of the insurance ecosystem partnerships we are seeing in the Africa Market are in the areas of new products and insurtech integrations. In new products and services, local insurers are leveraging APIs to deliver new product and service offerings like Usage Based Insurance (UBI) with players like BimaLeo, Scope technologies in Kenya and insurtech integration players like Lami, Octamile, Agencify using technology to offer embedded insurance and connected car/IoT solutions to customers.

CONCLUSION 

Digital expectations on African Insurers and the insurance industry as a whole have intensified largely driven by some of the general digital mega trends towards everything being online as well as mobile distribution and service channels.

African Insurers have responded to these expectations by opening up their operating model and core system landscape and offerings as well as consuming externally available API’s. By doing so they have enabled digital experiences for the other parties that are involved in the value chain.

With a modern core platform, African insurers are able to fully harness the power of APIs toward enhanced insurance business performance and competitiveness.

Are you ready to start exploring how to use API’s to improve your services and explore new markets/products? Learn more about how we can help you drive success through your API initiatives.

Visit https://turnkeyafrica.com/products/turnquest-connect/ or

Contact us at info@turnkeyafrica.com

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