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miLife is a digitally-enabled Ghanaian life insurer which leverages technology to improve insurance access to the underserved, partnering with major telecom providers such as MTN and Vodacom. LeapFrog is the majority owner of the company and has helped to transform miLife into one of the highest growth, innovative and profitable insurers in the Ghanaian market.
Since investment, LeapFrog has led the overhaul of governance and reporting, recruited a highly experienced leadership team and rebranded the company following an extensive insights-led process. Insights from LeapFrog’s team have also led to the launch of new pfroducts and distribution channels, enhanced agency force quality and productivity and refined operational processes and systems.
1 GSMA | miLife, Mobile Microinsurance in Ghana | Mobile for Development 2 National Insurance Commission Ghana, Increasing insurance penetration in Ghana, 2019 3 Ghana Statistical Service, Living Standards Survey 7, 2019 4 GSMA, Mobile Money for the Unbanked 5 Ibid 6 Ibid 7 National Insurance Commission, Landscape of Microinsurance in Ghana, 2015 8 Estimating the financial costs of funeral celebrations in Ghana, 2020 9 2014 Micro-insurance Landscape Survey
Insurance is a critical safety net for low-income Ghanaians, helping them reduce their vulnerability to shocks such as loss of a job or death of a family member1. However, Ghana’s insurance penetration of only 1%of GDP significantly lags regional peers like South Africa (17%), Namibia (7%) and Morocco (5%)2.
Affordability has been identified as one of the key factors behind low insurance rates in the country, alongside other issues like low understanding of insurance products3. Low-income consumers in Ghana often have irregular and unpredictable incomes, and limited access to bank accounts, making the collection of regular premium payments difficult and costly4. Cumbersome underwriting processes have also historically contributed to high insurance costs and poor understanding of products5.
Knowledge of insurance products is also low, particularly in rural areas6. Survey data suggests Ghanaians have low trust in insurance companies, view insurance paperwork as too difficult to fill out, and feel that claims take too long time to process7.
Without insurance, many Ghanaian households are vulnerable to economic shocks from events like illness, death, or injury. Expensive funeral traditions, for example, can often push vulnerable households into poverty. Costs to low-income families for each funeral can range from GHC15,500 (US$ 2,700) to over GHC33,500 (US$ 4,400)8, a significant outlay considering 60% of microinsurance customers earn an average monthly income of GHC600 (US$ 80)9.
Growing urbanisation and mobile connectivity are positive drivers to increasing insurance reach, however 75% of Ghanaian adults are engaged in the informal sector, which requires more innovative approaches to serve.
10 GSMA 11 GSMA, Mobile Money for the Unbanked 12 GSMA | miLife, Mobile Microinsurance in Ghana | Mobile for Development
LeapFrog took a controlling stake in miLife and has helped to built a leading Ghanaian life insurer with affordable and accessible insurance products for the mass market.
The company, which was founded in 2005 as CDH Life Assurance, has significantly evolved its insurance products and distribution over time to lower costs, increase access and make insurance easy to understand for those with limited financial literacy. Monthly premiums start at less than US$1 and range across a number of policies for funeral expenses, educational savings, life insurance and income protection plans.
Through innovative partnerships with telecom providers such as MTN and Vodacom, miLife has leveraged mobile networks as a major distribution channel for insurance products, targeting the 55% of the population with access to a mobile phone10. Customers can buy life insurance, initiate claims and make premium payments using basic mobile phones without data plans. The technology allows for increased flexibility for low-income consumers with irregular incomes, allowing them to stop and start payments as their cashflow permits11.
Direct communication with the end user also helps to build trust in the sector. Customers receive an SMS notifying them once their premium has been deducted and confirming their insurance cover for the following month12. By building a deeper understanding of its customers, miLife has been able to improve the pricing and design of its products to better serve low-income consumers and their unique needs. For example, claims payment has been updated to allow for integration with mobile wallets, allowing for customers to receive their lump sum payments directly, improving ease of access when they need it most, making claims more efficient, and reducing fraud.
Alongside its digital distribution network, miLife also uses its branch infrastructure and network of more than 500 agents to reach consumers across the country. Through this network, it has also worked to improve awareness and knowledge of the benefits of insurance products and reduce confusing jargon in marketing materials.
Cover image: Ghanaian funeral procession by Hannes Leitlein via Unsplash
Since investment, miLife has improved its reach by more than 400%.
From a product perspective, LeapFrog has assisted the company to redesign all key products, including miWay, a mass market life insurance product targeting low-income consumers. miWay was relaunched as mobile phone-based microinsurance product in 2018 and now accounts for more than half of the company’s total customer base. Underserved low-income customers are now able to access a range of easy-to-understand, affordable insurance products, offering them and their families improved financial stability and quality of life.
Comprehensive customer journey mapping by LeapFrog’s CX Launchpad team helped miLife to research customer issues, prepare solution and test them in the market. As a result, several accessibility upgrades were implemented, including changing billing cycles to mirror cashflow cycles, communicating to clients using simple text and images through WhatsApp, and in some cases using voice messages rather than SMS to reach customers with low literacy. The team also minimised the information required for new customers to register for miWay through their mobile phone, utilising existing know-your-customer data from telecommunications partners.
miLife is one of several LeapFrog investments in financial services. Read more about our investments with impact here.