Innovative insurance solutions aimed at social impact crucial for coverage growth – Yellowwoods

By Ebenezer Chike Adjei NJOKU

The comparatively poor insurance penetration rate in Ghana and across the continent presents a unique opportunity to grow the entire sector. Innovative products that embed social benefits are crucial to achieving this, rather than just capturing market share. Dr. Adrian Enthoven, Chairman of Yellowwoods, has said.

The broad national insurance penetration rate remains a little above one per cent, with more than 75 per cent of Ghanaians, representing about 25 million people, being uninsured, the sector regulator said last year.

And Dr. Enthoven, whose Yellowwoods—a private investment group with a portfolio of investments including one of the nation’s fastest-growing insurance groups, Hollard, with its life and general insurance subsidiaries, Hollard Insurance and Hollard Life—emphasised that insurance is not merely a business growth tool but a means to foster market transformation and broad-based economic benefits.

“Insurance is about transforming markets and ensuring that more people can manage risk effectively,” Dr. Enthoven said to the B&FT. “As Africa experiences both economic growth and a demographic dividend, the question is whether Africans will be able to manage risks and who will benefit from this growth.”

Innovative insurance solutions are central to this transformation. In Dr. Enthoven’s native South Africa, for example, products tailored for informal settlements have been developed, offering more than just financial protection. These products integrate early warning systems for fire hazards, ensuring communities are alerted to prevent widespread damage. “This holistic approach requires more than just selling a product. It involves solving real problems,” explained Dr. Enthoven.

“Our job is to think about how we can design solutions that address the specific risks these communities face, even if it means investing time and resources without immediate financial returns,” he added.

Empowering small businesses

Small and informal businesses, which form the backbone of many African economies, stand to gain significantly from tailored insurance products. These businesses often need help accessing credit and insurance, limiting their growth potential. By developing insurance solutions that unlock credit, insurers can provide these enterprises with the financial tools they need to thrive. “We are experimenting with exciting solutions combining insurance and credit guarantee models,” said Dr. Enthoven.

He further stated that the combination helps small businesses manage their risks while accessing the credit necessary for growth. He said it is about creating shared value and supporting the economic fabric of the communities.

Building households

At the household level, insurance plays a crucial role in financial resilience. Managing cash flows and protecting against risk events such as illness, accidents, or natural disasters is vital for poorer families. Insurance provides a safety net that ensures families can continue essential activities like education and housing stability despite adversity.

“The impact of insurance extends beyond financial security. It is about ensuring that families can maintain their livelihoods and continue contributing to the economy, creating a virtuous growth cycle and stability. Innovation and a commitment to broader value creation will be key to our success. We are excited about the potential to transform lives and communities through insurance, contributing to a more resilient and prosperous Africa,” the Yellowwoods Chairman said.

Nicola Galombik, an Executive Director at Yellowwoods responsible for social dividends and promoting sustainable and inclusive growth strategies, amplified Dr. Enthoven’s sentiments.

She said as the continent continues to grow, the insurance industry is poised to play a pivotal role in shaping the future. Insurers can drive significant social and economic change by focusing on underserved markets, innovating relevant products, and adopting a long-term investment perspective.

“We are deploying assets daily, not only to create financial value but also to generate significant social and environmental outcomes. Our goal is to see positive results that extend beyond the bottom line. Insurance has the potential to reshape entire markets and ensure financial security for millions of Africans.”

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