Turaco, a Kenyan insurtech company, has made a significant breakthrough in the country's underpenetrated insurance market by partnering with M-KOPA, a pay-as-you-go financing startup. The partnership has enabled Turaco to embed microinsurance into M-KOPA's smartphone offerings, providing coverage to over 1 million customers in Kenya.

This achievement marks a significant milestone for Turaco, which has spent six years disrupting the traditional insurance market with premiums of less than $2. By partnering with M-KOPA, Turaco has been able to tap into the startup's vast customer base, providing health insurance coverage to underserved families in Kenya.

M-KOPA has sold over 1.5 million smartphones from its Nairobi assembly plant, accounting for 20% of all new devices sold in the country in 2024, according to data from the Communications Authority of Kenya (CA). By embedding microinsurance into these smartphones, Turaco has made health insurance accessible to a previously underserved market.

Traditional insurance in Kenya has struggled to gain traction, with only 3.1% of the population covered outside the Social Health Insurance Fund (SHIF), according to the Insurance Regulatory Authority. High premiums, complex onboarding processes, and slow claims processes have kept millions uninsured. Turaco's innovative approach has addressed these challenges by providing affordable and accessible insurance coverage to low-income earners and rural populations.

"This product is built on our belief that insurance should be accessible, affordable, and impactful," said Ted Pantone, co-founder of Turaco. "By embedding health cover into M-KOPA smartphones, we've made health insurance available to underserved families in a way that is simple and easy to use."

The partnership has also been beneficial for M-KOPA and its investors, providing an opportunity to offer phones with other financial solutions, including insurance and affordable credit. The bundling model has proved effective, with 75% of M-KOPA's customers previously uninsured. In 2024, 50% of underwriters used their payouts for medical expenses, while others reinvested the funds in businesses or for household needs.

The integration of insurance into everyday financial tools could be the solution to Kenya's low insurance penetration. Turaco, M-Tek, and Pula Advisors are tech startups that have embedded insurance in their offerings to boost uptake. This trend is expected to continue, with more startups exploring innovative ways to make insurance accessible and affordable to underserved populations.

In conclusion, Turaco's partnership with M-KOPA marks a significant breakthrough in Kenya's insurance market. By leveraging technology and innovative business models, Turaco has been able to provide affordable and accessible insurance coverage to over 1 million customers in Kenya. This achievement has far-reaching implications for the insurance industry, and it will be interesting to see how other startups and companies respond to this trend.