Digital Transformation of Funeral Insurance in South Africa

Empowering Insurers with Agility, Efficiency & Growth

A Market Ready for Change

Funeral insurance is one of the most culturally significant and fastest-growing segments in South Africa's insurance market. Yet, despite its size and importance, it remains one of the most manually operated and technologically underserved sectors.

With rising consumer expectations for speed, convenience, and transparency, digital transformation is no longer an option—it is a necessity. Insurers who embrace technology will enhance operational efficiency, reduce costs, and expand market reach.

The question is: How can your organisation successfully navigate this transition?

INSTANDA empowers insurers to distribute digitally without the complexity or vendor lock-in of other suppliers. Moreover, it enables providers to design compelling customer journeys, connecting policyholders to relevant content that enhances engagement and retention, addressing the industry’s low levels of digital interaction and poor policy persistency rates.

More importantly, INSTANDA offers a cost-effective alternative to traditional insurance platforms, reducing IT overheads, eliminating expensive legacy systems, and increasing profitability.

Challenges Facing Funeral Insurers

Manual Processes

Traditional paper-based administration leads to delays, errors, and inefficiencies, causing frustration for both insurers and policyholders.

Rising Operating Costs & Inflation Impact

Funeral insurers are grappling with rising operational expenses due to inflation, increased administrative costs, and outdated IT systems. Higher supplier costs, wage inflation, and regulatory compliance expenses are putting pressure on profitability. Many insurers find themselves struggling to maintain margins while delivering the expected level of service.

Legacy System Inflexibility & Market Responsiveness Challenges

Many funeral insurers struggle with rigid legacy systems that hinder speed to market, making it difficult to launch new products, adapt to evolving customer needs, and respond to regulatory changes. These systems also lead to higher costs when making modifications, limiting insurers' ability to stay competitive in an evolving market.

Limited Digital Engagement & High Policy Lapse Rates

Many funeral insurers face a persistent challenge: keeping customers engaged and retaining policies beyond the first year. Outdated systems, a lack of seamless digital touchpoints, and limited self-service options make it difficult to maintain strong customer relationships. Without accessible online portals, automated reminders, and real-time policy management, policyholders are more likely to disengage, miss payments, or let their coverage lapse.

The impact is significant: nearly 50% of new funeral insurance policies either lapse, are not taken up (NTU), or are cancelled before reaching their first anniversary. To combat this, insurers must adopt proactive digital engagement strategies that enhance convenience, encourage ongoing participation, and ensure policies remain active.

Regulatory Compliance & Market Consolidation

Stricter regulations from the Financial Sector Conduct Authority (FSCA) are pushing insurers towards greater transparency and consumer protection. Those failing to modernise face market consolidation and declining competitiveness.

The Digital Future of Funeral Insurance

INSTANDA: The SaaS Platform That Delivers Tomorrow’s Digital Funeral Solution Today

Reduce Costs, Maximise Profitability

INSTANDA provides funeral insurers with a cost-effective, cloud-based platform that eliminates the expense of legacy systems and inefficient manual processes. By streamlining operations, automating workflows, and integrating digital capabilities, insurers can significantly lower operating costs while enhancing customer satisfaction and market competitiveness.

Why Choose INSTANDA?

1. Cost Efficiency & Profitability

• Reduce operational expenses by eliminating outdated IT infrastructure and lowering administrative burdens.

• Automate workflows to decrease labour-intensive tasks, reducing processing costs and allowing staff to focus on human-centred tasks.

• Minimise customer acquisition costs with optimised digital distribution strategies.

• Enhance profitability by improving retention rates and reducing policy lapses.

2. Localised, Flexible Product Design

• Dynamic policy structures – Design funeral insurance policies that cater to cultural and family needs.

• Custom payment options – Support cash-based, mobile money, and tiered payment plans.

• Automated compliance – Ensure FSCA regulatory adherence with built-in audit trails and policy wording automation.

3. Omnichannel Sales & Distribution

• Enable direct-to-consumer digital sales, broker-assisted policies, and partnerships with banks, retailers, and fintechs.

• Customise commission structures for agents, brokers, and funeral parlours.

• Gain real-time sales insights to optimise distribution strategies.

4. Digital Customer Engagement & Retention

• Create personalised customer journeys that drive engagement and improve policy persistency.

• Provide self-service portals where customers can manage policies, update details, and file claims.

• Enable automated messaging and content-driven engagement to keep policyholders informed and connected.

5. Digital Payment Integration & Policy Administration

• Connect with mobile wallets, QR codes, EFT payments for frictionless premium collection.

• Automate policy updates, reminders, and renewals to reduce lapses.

• Provide self-service portals where customers can manage policies, update details, and file claims instantly.

Future-Proof Your Insurance Business with INSTANDA

The South African funeral insurance industry is evolving rapidly. Over the next 5–10 years, insurers will need to adapt to:

• 100% digital onboarding & claims processing.

• AI-driven underwriting & fraud detection.

• Seamless insurer-fintech partnerships.

• New, digital-only competitors disrupting the landscape.

The Choice is Clear: Digitise Now or Risk Falling Behind

Partner with INSTANDA Today

INSTANDA is the technology partner that funeral insurers need to scale, optimise, and future-proof their business. Ready to digitise your funeral insurance offering at a competitive price while maximising efficiency and profitability?

Get in Touch

Will Wood
Director Life & Health
INSTANDA
📧 will.wood@instanda.com
📲 +44 (0)7398237843