South Africans want protection that keeps up with how they live and earn

South African consumers, particularly those in the so-called “foundation market,” are demanding insurance products that align with their evolving lifestyles and financial situations, according to new research by financial services provider Metropolitan. The study reveals that approximately 11.9 million individuals, many of whom rely on irregular or informal income, are seeking affordable and adaptable protection options that reflect their unique economic realities. This group, which includes grant recipients, domestic workers, seasonal earners, and small-scale township entrepreneurs, faces significant challenges in securing adequate financial security. Many struggle with unpredictable income streams and rising living costs, making traditional insurance models difficult to access or sustain. Despite these hurdles, the research indicates that this segment is actively engaged with financial services. Most are banked, frequently use mobile technology, and have shown consistent interest in products such as funeral cover, which remains one of the most popular offerings in the category. However, the data highlights a growing disconnect between existing insurance products and the needs of this population. Nearly 40% of those surveyed are aged below 40, suggesting that younger generations are increasingly shaping the demand for more flexible and accessible protection. Over half of the respondents reported difficulty in affording regular monthly expenses, indicating that cost remains a critical barrier to comprehensive coverage. Luke Nel, head of protection solutions at Metropolitan, emphasized that the findings signal a fundamental shift in the financial inclusion landscape. He noted that while traditional funeral cover continues to serve those with stable incomes, there is a clear need for alternative solutions tailored to those with fluctuating earnings. “South Africans are not saying they do not value protection,” Nel stated. “They continue to prioritize family security, but different households face different financial realities.” In response, Metropolitan has launched the No-Lapse Funeral Growth Plan, a product specifically designed for individuals with irregular or cash-based income. This initiative allows customers to begin coverage with a minimum initial payment of R200, providing immediate protection. Subsequent contributions can be made at convenient times, enabling users to gradually increase their coverage over time. After paying a total of R1,500 within the first year, participants qualify for permanent coverage for themselves and their immediate family, contingent upon meeting specific terms and conditions. The product is built around digital accessibility, allowing enrollment via WhatsApp in under five minutes. Payment methods include online transactions through banking apps, card payments, and in-store purchases at major retail chains such as Shoprite, Pick n Pay, PEP, Spar, and Makro via the Pay@ network. This approach ensures ease of use and adaptability, crucial for a demographic accustomed to managing finances through mobile platforms. Metropolitan clarifies that the No-Lapse Funeral Growth Plan does not replace traditional funeral cover but instead complements it by offering an additional option for those requiring greater flexibility. The product’s design incorporates several appealing features, including a no-lapse guarantee, the ability to enhance coverage, affordability, and a referral program that rewards participants for bringing in new clients. Customer feedback during concept testing underscored the importance of these elements. A majority of respondents indicated a preference for self-payment, while a smaller percentage expressed willingness to share the burden with family members. These insights highlight the nuanced preferences of the target audience, reinforcing the necessity for personalized and adaptable financial solutions.