Africa’s insurance market is projected to grow from US$98.5 billion in 2025 to US$166.1 billion by 2034, as digitalisation, regulatory reforms and broader financial inclusion efforts reshape the sector across the continent, according to a new report by IMARC Group.
The forecast implies an average annual growth rate of 5.79 per cent, with insurers increasingly using mobile technology, automation and artificial intelligence to expand access, reduce costs and improve customer experience in markets where insurance penetration remains low. While the headline market estimate comes from IMARC, much of the transformation is being driven by practical shifts in distribution and claims management now visible across African markets.
The report identifies regulatory modernisation, consumer protection reforms, and the expansion of microinsurance products as central to the sector’s next growth phase. Governments and regulators across Africa are under pressure to broaden access to insurance, especially for low-income households, informal workers and rural communities that remain largely excluded from traditional coverage. That is pushing insurers to design smaller-ticket, more flexible products around health, life, agriculture, livestock and climate risk.
One of the strongest enablers of that shift is mobile distribution. Across the continent, insurers are increasingly partnering with fintech firms, payment platforms and telecom-linked channels to reach customers who may never walk into a physical branch. These partnerships are helping insurers simplify onboarding, automate premium collection and reduce administrative friction, particularly in underbanked areas. The result is a more scalable model for extending coverage to first-time users.
The sector is also being shaped by Africa’s demographics. A fast-growing population, expanding urban centres and rising awareness of financial risk are all supporting demand for insurance products. As households and small businesses become more exposed to healthcare costs, crop failure, property loss, transport disruption and weather shocks, demand is gradually shifting from optional cover to more practical risk protection. Public education campaigns and better digital access are also improving understanding of how insurance works, which has historically been a major barrier to uptake.
Climate change is emerging as another major force in the market. More frequent droughts, floods and severe storms are pushing insurers to rethink how they assess risk and pay claims. This is accelerating interest in parametric insurance, where payouts are triggered automatically once predefined thresholds — such as rainfall failure or wind intensity — are met, rather than after lengthy physical loss assessments. That model is increasingly relevant in agriculture-heavy and climate-vulnerable African economies.
AI to shape the next phase of growth
Artificial intelligence is expected to play an increasingly important role in how insurers operate, especially in claims processing, fraud detection and customer support. African insurtech firms are already using AI to shorten settlement times, improve verification and lower operating costs in a sector long associated with paperwork and slow claims resolution.
In Nigeria, Curacel says its systems have vetted 2 million claims, processed more than US$100 million in claims value and helped clients save over US$15 million through automation and tighter controls. The company also says its health claims infrastructure can process claims 70 per cent faster, underlining how digital claims management is becoming a competitive differentiator for insurers across the continent.
In Kenya, Britam has also expanded its use of AI in insurance servicing. Last month, the firm said its AI-powered motor assessment service could assess vehicle damage in about 15 minutes and settle eligible claims within two hours, compared with the industry’s traditional multi-day process. Its microinsurance arm, Britam Connect, says it insured more than 5 million lives by 2025, highlighting the scale potential of low-cost, digitally distributed products.
Taken together, these developments suggest Africa’s insurance market is entering a more technology-led expansion phase. Growth will still depend on affordability, trust and regulation, but the direction is becoming clearer: the next decade of African insurance is likely to be shaped less by branch networks and paper forms, and more by mobile-first access, automated claims, embedded products and data-driven underwriting. If those trends continue, the continent’s insurance market could become not just larger by 2034, but also far more inclusive and resilient.
