How A Tanzanian Woman Is Disrupting Healthcare With A Mobile Micro Insurance Product

How A Tanzanian Woman Is Disrupting Healthcare With A Mobile Micro Insurance Product

Lilian Makoi is the woman behind Jamji Africa. Photo Makoi

It was a personal loss that led Tanzanian businesswoman Lilian Makoi to come up with an affordable healthcare solution. She has co-founded a number of startups, but her biggest and most positive business venture to date is Jamii Africa.

Jamii Africa provides health insurance targeted at the low-income market, made up of people who earn less than $70 a month. Today, Jamii Africa has a potential of 47 million subscribers. The health insurance solution is much needed in Tanzania, where “the penetration of health insurance is as low as 4.5 percent and this makes the formal sector its only population. The main reason they have health insurance is because they get it as benefit from the employer,” She Leads Africa reports.

Jamii performs all the administrative activities of the insurer, helping cut insurance administration costs by 95 percent. This makes a health insurance product a lot cheaper — at around $1 a month.

Makoi says she believes you have to take risks and disrupt industries in order to make positive change. She tells Moguldom just how she plans to do this.

Moguldom: What was it like to be named the Most Innovative Woman in Technology, Africa 2016 by The World Economic Forum?

Lilian Makoi: It was so rewarding being recognized for the effort the team and I have put on the initiative so far!

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Moguldom: How did you get into tech?

Lilian Makoi: My education background is in human resources management undergraduate, then international business as a master’s degree. So my first job was in administration for a mobile value-added services company (Spice VAS Tanzania Ltd). Afew months after I joined the company, I was promoted to a product manager, then to an account manager, which exposed me to telecom companies as we managed ring-back tones and mobile radio services for all telcos in the country. I later worked for other providers and telcos directly in Tanzania, Rwanda and Malawi, and got the exposure to mobile-based products.

Moguldom: How diverse is the tech sector in Tanzania?

Lilian Makoi: It is just developing. In so much as there have been tech companies that are legends and existed over the years, it is only recently that we have more new players coming in and the youth actively playing a major role in the tech space as founders, CEOs and other top positions.

There are tons of opportunities in terms of solving basic to business problems in the country using technology. I must commend the youth for now being very active and risk-averse in technology. More could be done, however, in developing the ecosystem and support available to make the journey shorter and easier for the founders and CEOs.

Moguldom: What made you want to start Jamii Africa, a mobile micro-health insurance product for the low-income population?

Lilian Makoi: After losing someone in the family from a treatable medical emergency, and the main reason for the loss is the immediate family’s inability to pay for medical services, it was a wake-up call for me. What was shocking was the results from a research that I did after the incident. It was a shock finding out that in-access and in-affordability to medical services was a problem facing 70 percent of the Tanzania population, about 37 million people. I spoke to various insurers to understand why they were not addressing an obvious market and each came back with the same response: ‘high insurance administration costs’ made it impossible to quote affordable policies for the low-income population.

Through the experience I had gained in my career it was easy to craft out how the mobile phone can be used to do most, if not all, of the administrative activities of the insurer, from on-boarding, premium collection, benefit ledger management, claims processing and payout. We then built the platform and reached out to Vodacom as a product partner, then an insurer to underwrite it.

Moguldom: How does Jamii Africa work?

Lilian Makoi: With Jamii, users easily call Vodacom’s M-Pesa USSD menu and select a policy fit for their family size and what they can afford. We have policies costing from $1 a month to $70 a year which also vary from 3 months/6 months to 12 options for individuals or families. After selecting the desired policy, they pay the premium via M-Pesa and our platform manages their benefit ledger, claim processing and payout to hospitals. The platform cuts out the need for paperwork and manpower that makes insurance expensive. For each selected policy option, the user can spend 500 times the premium paid to access medical services.

The policyholder is then allowed to get medical services within the benefit cap, upon which we pay the hospital’s approved claims via M-Pesa.

Moguldom: What were some challenges you faced in starting Jamii Africa?

Lilian Makoi: The major challenge was knowing my way around building a team and a company altogether, but this was solved by attending various accelerators that built us to know our way as a startup growing to a major company. The other major struggle was raising capital, in a country where the ecosystem was very, very new with no local investor or accelerators. We eventually raised our seed round from external investors and a local angel investor. This took us a year to close the seed round with a lot of work and patience.

Moguldom: What are some aspects you would change about running a business in Tanzania?

Lilian Makoi:  I would wish to have quality local accelerators, develop local investors and make the process of opening a company to getting into partnerships easier. I would also wish to make the government more welcoming to work with the private sector and startups, instead of it running all the businesses itself. I would also make the tax system easier to understand, cheaper to implement.

Moguldom: What are the advantages of having a business in Tanzania?

Lilian Makoi:  The market size in Tanzania for digital solutions is massive, with 80 percent of households having mobile phones and using mobile money, the market allows for mobile-based innovations. There are also many problems to solve from finance, health, education, housing, to government systems. This makes Tanzania a sweet spot for innovative businesses and more.

Moguldom: What is the health insurance sector like in Tanzania?

Lilian Makoi:  In Tanzania, of 50 million people, only five percent have health insurance, these are people from the formal sector getting health insurance as an employment benefit, 26 percent of the population makes the middle-income population that can afford healthcare financing, while the remaining 70 percent is the low-income population struggling with no health-financing options.

The government is running health insurance options targeting government employees, children, and low-income populations with NHIF, Toto care and CHF options respectively. The private sector consists of multiple insurers catering for the formal sector through corporates.

However, collectively these initiatives are challenged by reach, affordability and sustainability.

Moguldom: How does Jamii Africa help the low-income community?

Lilian Makoi: We provide affordable policies with flexible payment options that match nature of the low-income families, being sporadic. Jamii is also accessible from the comfort of your home via any feature or smartphone. Jamii provides the low-income population with the corporate cover experience by allowing policyholders to access medical services without paying cash, whereas Jamii settles all approved claims in the backend directly with the hospital. This is unlike hospital cash options in other markets. In doing so we reduce the rate of deaths from curable diseases, home births and maternal deaths.

Moguldom: What are your goals for Jamii Africa this year?

Lilian Makoi: Our goal this year is to do more in the Tanzania market to direct customers and SMEs. We are doing more education and marketing campaigns in rural and urban Tanzania, especially in regions where we are introducing Jamii for the first time. We are also working on our partnership in Kenya and gearing for a pilot.

Moguldom: What do you like the best about what you do?

Lilian Makoi: The impact on families that Jamii has! I love seeing how many people we enable access medical services via Jamii. It gives us purpose and pure fulfillment. We are excited to impact more lives past the Tanzania market, but within other countries in Africa, since the problem situation is the same across the continent.