| Abstract: |
The aim of this paper is to investigates the influence of trust on insurance
penetration in the developing Microinsurance sector of South Africa. Legacy
issues and deeply rooted structural and institutional frailties have resulted
in substandard levels of financial inclusion for low-income earners in the
country. This segment of consumers is highly vulnerable to social, economic
and as the covid-19 pandemic has proved, health shocks. Microinsurance has
often been touted as a solution to improve resilience and turn the tide of
significant adverse economic outcomes for the low-income segment. This paper
explores the role of trust as a key construct for business success in the
microinsurance sector. The study findings indicate that creation of trust and
reassurance that claims will be honored when liability occurs are the main
elements valued by prospective and existing microinsurance consumers. These
findings contribute to advancing knowledge within the microinsurance segment,
in particular, key traits needed in constructing a successful insurance
programme as well as the messaging and serving element that needs to be placed
at the forefront of product design and marketing in order to build trust. |