Turaco, a leading African insuretech company, has achieved a significant milestone by insuring over 1,000,000 customers. The company, which secured a $10 million Series A funding in September 2022, is utilizing the investment to expand its operations rapidly.
Operating in Nigeria, Kenya, and Uganda, Turaco aims to provide accessible and affordable insurance to mass-market consumers, offering them a crucial safety net against financial shocks.
A notable portion of Turaco’s recent growth can be attributed to its partnership with Airtel Money Uganda and Prudential Uganda. Within the last three months, 350,000 individuals have signed up for Turaco’s insurance products through this collaboration.
Read About: Turaco – Airtel Hospital Sente
This rapid customer uptake underscores the demand for Turaco’s innovative and customer-centric approach. Their Airtel Hospital Sente product, featuring a simple two-step USSD sign-up process and an average 15-hour turnaround time for claims processing and payment, has been designed to be user-friendly and efficient.
The pressing need for affordable insurance in Africa becomes evident when considering that 89 million Africans face catastrophic health events annually, often spending up to 10% of their income on a single incident. Shockingly, these health crises push 14 million Africans into poverty each year.
The root cause of this vulnerability lies in the fact that less than 2% of people in East and West Africa have access to insurance. Turaco addresses this issue by forging partnerships with prominent tech-enabled companies like M-KOPA, Paga, One Acre Fund, and Vision Fund to create white-labeled insurance products.
By integrating insurance sign-up and payment options into the purchase process of these partner products and services, Turaco ensures wider access to affordable and straightforward insurance for customers.
Ted Patone, CEO and Co-Founder of Turaco, expressed his satisfaction with the company’s progress, stating, “We founded Turaco with a vision to insure the next 1 billion people. Surpassing 1 million customers is an important and validating milestone in that process. More importantly, this number represents 1,000,000 individual mothers, fathers, children, and community members that have access to better health care and improved financial resiliency as a result of Turaco insurance. We are excited to continue on our path to 1 billion people insured.”
The pressing healthcare challenges in Africa are highlighted by the World Health Organization (WHO), which states that Africa bears a quarter of the global disease burden but has access to only 3% of health workers and less than 1% of the world’s financial resources.
Unfortunately, most African countries have not fulfilled their commitment to allocate at least 15% of their national budgets to healthcare, leaving quality healthcare largely unaffordable for the majority. While a two-tier system allows the wealthy to access private health insurance for quality care, the majority must rely on overcrowded, underfunded state-run facilities and pay out of pocket.
Tragically, the situation is worsening, with the share of out-of-pocket health payments as a proportion of all health expenditures in sub-Saharan Africa rising from 40% in 2000 to over 60% in 2014, according to the World Bank. The burden of these expenses can push families into a cycle of poverty.
Experts believe that the private health insurance industry, in collaboration with governments and leveraging technology, has the potential to transform healthcare systems in Africa. However, critics caution that without proper regulation, this industry could enrich insurance providers while denying or limiting treatment to patients.
They warn against potential laxity in fraud prevention, wasteful practices, and cost control. Critics further raise concerns about insurers selectively covering certain diseases, avoiding enlisting individuals with pre-existing conditions, or denying treatment whenever possible.
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