By Charndré Emma Kippie
Mutoda Mahamba is a force to be reckoned with in the South African insurance industry. Two years ago he started his own insurance company called Solvency Insurance which helps South Africans save money through their premiums.
Unlike any other insurance product on the market, with Solvency you can allocate a portion of what could have been your monthly insurance premium into an Insurance Savings Account (ISA). Clients get Flexible Insurance Cover, allowing them to decide what percentage – up to a maximum of 45% – of their monthly motor or household insurance premium goes to their ISA based on what excess they are prepared and able to pay.
Mutoda’s greatest passion is to educate South African consumers on how to save when it comes to insurance. In this interview, he provides valuable insight into South Africa’s insurance industry, and how to reduce exploitation of consumers.
Please could you tell us a bit about your background.
I have been in the financial services for 15 years. I began my career as an actuarial analyst at Alexander Forbes, performing pension fund valuations and pension fund consulting work. After two years, I decided I wanted to specialise in insurance. Hence I spent five years at Absa Insurance Company as a pricing specialist and another three years at Momentum Short Term Insurance as the Head of Analytics.
Before becoming an entrepreneur, I was the executive Head of Product: Africa at Momentum Metropolitan Holdings, a role that led actuarial product development for short-term insurance, life insurance and health, across 8 African countries in West Africa, East Africa and Southern Africa. In 2020 I launched an insurtech business, Solvency – of which I am the founder and CEO.
What are you most passionate about in the business of Insurance?
Product development and innovating new products. I love developing unconventional solutions. I don’t easily accept “no” for an answer, especially when the solution is aimed at improving the financial wellbeing of consumers of financial services.
What are the top 3 trends in the industry right now?
- There’s a trend to reduce exploitation of consumers. From no-claims cashbacks, driver-behaviour rewards (telematics) and user-based insurance.
- There is an increased adoption of technology to automate process and allow consumers to engage in the method that they prefer.
- Insurance penetration is not growing in South Africa; hence insurers are having to come up with ways to stand out from the crowd by the use of technology or non-inducing competitions in an effort to lure customers.
What 5 tips do you have for finding solutions in your field?
- Be a subject matter expert first; insurance looks a lot simple from the outside but it’s actually very technical. Hence make sure that you understand the value chain and the levers that affect the success of an insurance business.
- Have a strong team that is competent in the various areas of insurance i.e. product development, technology and marketing.
- Be resilient. The industry has high barriers of entry; so you have to be willing to sacrifice a lot to get what you want.
- Start start start!! Don’t wait for the perfect solution before you start – “There’s no perfect solution, but rather a solution perfected.”
- Start small and be very clear and stick to the minimum viable product.
How can insurance brands reward their clients in today’s climate?
Insurance brands should offer solutions that benefit customers throughout the lifecycle of the policy. Be it cashbacks, premium reductions or discounts at retailers, customers must experience the benefits of insurance not only when a claim gets settled. Considering that the average customer claims on average once every four years, an insurance brand cannot be of value to a customer only once every four years.
The Solvency solution is a case in point about rewarding clients in today’s climate. The Solvency solution offers short-term insurance cover, combined with the ability to save and invest seamlessly. It’s a unique solution that helps South Africans deal with two crucial challenges: protecting themselves and their families against key life risks and saving for the future.
Solvency policyholders can allocate up to 45% of what could have been their monthly car and household premium into a separate Insurance Savings Account (ISA) in their name. The decision on how much to allocate to the ISA is guided by the excess they can afford in the event of a claim. ‘The ISA can be used to fund the excess in the event of a claim. But more importantly, up to 50% of the past 12-months’ ISA can be withdrawn directly to the client bank account. If the client ever cancels the insurance policy, the full ISA is paid into their account.
Are there any career milestones you’re most proud of?
I am proud of implementing a strategy in 2017 that turned around an insurance business in Kenya. The business went from a R110 million loss loss-making position, to making a R50 million profit within a space of 12 months. My proudest moment, however, was when the first Solvency product policy was bought in 2020.
Have you read any books that have inspired you thus far?
- Outliers by Malcolm Gladwell
- A Beautiful Mind by Edward de Bono
- 12 Rules of Life by Dr Jordan Peterson
- The Boy Who Never Gave Up by Dr Emmanuel Taban
What is your ‘why’ i.e. Bottom line?
Making a positive impact one day at a time, starting with my family, then business and the community.
Outside of work, are you involved in community outreach projects?
I am involved with Partners for Possibility (PfP), a leadership development initiative designed to equip school principals to lead change towards quality education for all in South Africa. PfP improves the quality of education by capacitating school principals from under-resourced South African schools and building their leadership skills through partnerships with business leaders.
I have been the business partner to Hofmeyr Secondary School in Atteridgeville, Pretoria, since 2018. Together with the principal, we embarked on a project to start the Hofmeyr Alumni Club in 2018, which seeks to have alumni of the school involved in the well-being of the school. The response has been positive, and the school is more capacitated from a human, social and financial capital point of view. I am immensely proud of the fact that the matric pass rate has increased from 57% in 2017 to 84% in 2019.
What advice do you have for those who aspire to work in your field?
Everyone is guessing. Never doubt yourself, especially in the workplace or boardroom. There is no reason why someone else’s solution should automatically be deemed as superior to yours. Throw your name into the hat; raise your hand; interrupt; let your voice be heard. Everyone is guessing.
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