DOVES Funeral Assurance has launched a new product, Smartdove, which is expected to contribute over $100 000 to the company income by December 2014.
TARISAI MANDIZHA BUSINESS REPORTER
Prospective clients will register using their cellphones. The same platform allows members to add their dependents at additional premiums and the payments will also be done using the same platform using vouchers that will be distributed in OK Supermarkets and at Doves branches.
All mobile money transfer services such as EcoCash, One Wallet and Tele Cash are also linked to the Doves payment system.
The product costs $2,50 a starter pack. Monthly premiums will be $1 for each immediate family member and $2 for each dependent and $2,50 for each line holder.
In an interview with sister paper NewsDay, Doves general manager sales and marketing Albert Mawungwe said the funeral assurer was expecting to register 10 000 policies generating $25 000 per month.
“We expect to register an average of 10 000 people by end of September and each month we are looking at generating $25 000. Smartdove is expected to generate plus or minus $100 000 by December 2014,” Mawungwe said.
“A basic funeral will be provided on three-tier caskets for the immediate family and three-tier coffins for dependents. Hearse for the deceased will be provided within a radius of 30km from Doves parlour and a beneficiary who uses an alternative funeral provider will be given cash in lieu. Other dependents have a waiting period of up to six months,” he said.
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He, however, said many people in Zimbabwe have the belief that funeral policies were a preserve for the middle to the upper class, yet the industry has products that are designed to suit all market segments.
“The penetration rate has been very low for the informal sector segment and the unbanked market, because of the premium remittance challenges leading to high lapse rates. The above mentioned markets have on numerous occasions tried to prepare for funerals by setting up family funds, burial societies, among many other initiatives. These initiatives have failed to provide long term solutions since the funds are frequently abused,” he said.
Mawungwe said the Smartdove product will address these challenges as well as increase funeral policy accessibility to mass market since the product would be sold in supermarkets and by airtime vendors.
The funeral industry recorded 18% increase in net premiums to $19 million for the first half ended June 30 2014 from $16 million in 2013 according to a latest report from the Insurance and Pensions Commission (Ipec).
The report is based on nine funeral assurance companies.
Doves recorded a 30% growth to $4 244 000 for the first half ended June 30 2014 from $3 275 000 in 2013.
In the period under review, 80% of the net business was written by the three biggest players which are Moonlight, First Funeral and Doves as compared 84% in June last year.
“Players are encouraged to continue building on this growth momentum by way of product innovation and embracing new concepts particularly micro-insurance whose framework is under preparation. Should growth continue, penetration levels which are currently at 3% would increase,” Ipec said.
