OP-ED: Embedded Insurance—How routine township shopping in South Africa now buys you 'invisible' funeral cover
When Johannesburg-based South African entrepreneur Prince Nwadeyi was researching his MPhil in Inclusive Innovation at the University of Cape Town, one interview proved transformational. A young woman broke down describing the humiliation of borrowing money to bury her mother, only to face gossip at the funeral about the family's financial struggles.
That 2019 conversation shaped Nwadeyi's thesis on information asymmetry and life insurance uptake in township communities. More importantly, it led him to question whether insurance could be invisibly woven into everyday purchases—eliminating the paperwork, intermediaries, premiums, and waiting periods that keep vulnerable communities unprotected.
Last week, Nwadeyi took to Linkedin to share that his holding company, SAG Ventures, had paid out its first claim through a clever FMCG-embedded funeral cover product dubbed Purchase Pal, underwritten by the continent's largest insurer, Sanlam.
A grieving family received a much-needed funeral payout because they'd purchased participating products at one of South African supermarket and wholesaler Big Save's stores. No forms, no monthly deductions, just automatic protection triggered by routine shopping habits.
The innovation exemplifies a principle increasingly recognised as crucial for African product development: building with communities, not for them. Nwadeyi's team's method emerged from deep ethnographic research and venture building experience (iterative product development and go-to-market) in partnership with leading blue-chip companies, not top-down, boardroom assumptions about what consumers need.
During a recent yet-to-be-published African Tech Roundup Podcast conversation, recorded shortly after his insurance product went live, Nwadeyi emphasised how deep learning of incentive structures across entire value chains - from wholesalers to customers to capital providers - enabled breakthrough collaborative thinking. Instead of competing with traditional distribution channels, his team built coverage into existing retail margins.
Strategy meets reality
This community-first approach contrasts sharply with the template-driven product development that Lagos-based Nigerian “social engineer and human experience expert” Dayo Ayoade witnessed during his tenure leading WeChat's failed West African takeover bid.
Speaking with fellow Nigerian co-hosts Chika Uwazie and Eche Emole on the Afropolitan Podcast, Ayoade described how back in 2015 his team spent a busload on marketing and feature development, only to watch WhatsApp - with no Nigerian office and minimal local investment - dominate the market.
The turning point came through an unlikely channel. During the Redeemed Christian Church of God's December congress, Ayoade's team spent just ₦150,000 (~USD 95) on Wi-Fi and a banner promoting Pastor Adeboye's sermons on WeChat. That single week generated 3.6 million new users—more than all their previous marketing efforts combined.
"Culture eats strategy for breakfast," Ayoade reflected. The Chinese executives, uncomfortable with religious content, decided Nigeria wasn't a market they wanted to pursue. This disconnect illustrates what Ayoade identifies as a fundamental misunderstanding: products solve social problems, not technological ones.
His sense is that WeChat succeeded in China by enabling factory workers in small communities to coordinate daily needs through group chats, and that in the UK, contactless payments proliferated because pervasive train systems made tap-to-pay natural behaviour. Neither imposed solutions; both amplified existing local context.
Design with, not for
The same philosophy underpins Marcus Welby Rance's citizen-centric approach to steering digital transformation at South Africa's Western Cape Government. Rance advocates moving beyond technology-first thinking towards what he terms "empathy-driven innovation", tapping into citizen pain points before proposing digital solutions.
Rance's framework, rooted in Ubuntu principles of interconnectedness, maintains that co-creation can bridge the trust deficit between African governments and citizens. Crucially, the initiative prioritises the 73% of the Western Cape's population classified as vulnerable, as opposed to digitally-enabled middle-class users.
He admits that while the framework requires patience and political will, it offers a path towards digital transformation that serves communities ahead of abstract efficiency metrics.
Accidental innovation
Perhaps nowhere is the "people decide" principle more evident than in Nigeria's entertainment landscape. During the same Afropolitan Podcast conversation, Ayoade highlighted a striking statistic: while Nigeria's highest-grossing cinema film reached perhaps 200,000 viewers, YouTube creators like Uche Montana routinely attract 4-6 million views per movie.
"Nigerians don't go to cinema," Ayoade observed. "Nigerians watch home videos." YouTube simply became the new distribution platform for Nigeria's existing home video consumption norms—a shift that happened organically and not through strategic planning.
YouTube is the new Nollywood.
— Eche Emole 🅰️🌶 (@Echecrates) June 1, 2025
Millions of Nigerians stream local movies every day—home video-style. But creators barely earn from it.
Dayo Ayoade says:
🧠 Build payment infra for ₦100 content access
🚫 Don’t copy YouTube—integrate with it
📲 Nigerians will pay, if it works for… pic.twitter.com/Mmpg28GCFC
The mathematics are telling. Nigeria's billion-naira box office success translates to roughly 200,000 viewers paying ₦5,000 (~USD 3.20) each. Meanwhile, a YouTube home video achieving 6.4 million views represents 30 times the reach, and unlike cinema-goers, nobody watches twice because data is expensive, likely making these genuine unique viewership numbers.
This pattern exposes a familiar challenge: Africans excel at creating value but struggle to capture it within existing monetisation frameworks designed for different markets and consumption habits.
Sustainable innovation architecture
What connects these examples is sophisticated intepretation of incentive alignment across complex ecosystems. Nwadeyi's micro credit business, Setana Capital (backed by Allan Gray's impact investment fund, E Squared), illustrates this sensibility by partnering with wholesalers to access transaction data, using that intelligence to provide working capital directly to township retailers (read spaza shop owners), and financing stock purchases through existing supply chains.
The result: Nwadeyi claims a 99.9% repayment rate across multiple verticals, from spazas to Uber drivers requiring fuel credit. "We don't give entrepreneurs cash," Nwadeyi explained during our conversation. "We partner with the value-making process."
The embedded insurance model applies similar logic. Rather than competing with traditional brokers, the team baked funeral cover into FMCG product margins, creating value for retailers (customer stickiness), insurers (reduced acquisition costs), and consumers (invisible protection).
These solutions didn't emerge from Silicon Valley playbooks, performance-metric-obsessed boardrooms or donor-funded innovation labs. They developed through patient ethnographic research, systems thinking, and willingness to work within existing economic structures, eschewing attempts at wholesale disruption.
Authenticity advantage
What distinguishes these innovators is their starting point: purpose over scale. Nwadeyi's insurance product addresses a specific pain point he researched extensively. Ayoade's insights emerged from genuine attempts to decipher Nigerian communication trends. Rance's government work prioritises vulnerable populations over prestigious technology demonstrations.
This purpose-first MO enables what Nwadeyi describes as "assimilate, understand, and respond", not simply reacting to market shifts. It requires cultural humility, acknowledging that communities are more in touch with their needs than external observers, regardless of technical expertise or funding capacity.
This demands long-term thinking. Nwadeyi was at pains to emphasise that Purchase Pal represents part of a five-year strategy spanning multiple financial services verticals. The goal isn't rapid unicorn status but sustainable value creation that other innovators can adapt and scale.
Beyond import-export innovation
The path forward doesn't involve creating African versions of global successes. Instead, it requires building infrastructure that amplifies existing African cultural patterns and social structures.
Ayoade suggests that rather than building "Nigerian YouTube," opportunities lie in creating payment systems that integrate with existing platforms to solve local monetisation challenges. Nwadeyi's 'invisible' insurance model points towards similar possibilities—leveraging existing distribution networks and social norms to deliver new forms of value.
Rance's government work demonstrates how this applies to public sector innovation: creating platforms that enable communities to solve problems themselves without imposing predetermined solutions.
These case studies spotlight ingenuity that's distinctly African: purpose-driven, community-centred, and built on deep cultural grasp.
In contexts where Silicon Valley’s "move fast and break things" mentality has revealed limitations, Africa's Ubuntu emphasis—the interconnectedness of people and communities—offers sustainable alternatives worth exploring further.
The distinction determines whether solutions create or extract value, and whether financial success and community benefit can be mutually reinforcing.
As Nwadeyi observed: "You've got to be willing to try, you've got to be willing to do the hard work to learn, listen, understand."
The future belongs to those who stop building for Africa and start building with Africans.
Editorial Note: A version of this opinion editorial was first published by Business Report on 03 June 2025.