South Africa’s Insurers Enter The Age Of Agentic AI As CX Becomes The New Battleground

Despite South African insurers investing significantly in digital transformation over the past decade, many customers still experience fragmented and slow journeys that rely heavily on manual processes.

Agentic Artificial Intelligence (AI), however, is emerging as the technology capable of closing this gap. Unlike traditional AI and early generative AI, which have focused primarily on analytics, pattern recognition, rule-based automation and content creation, agentic AI represents a fundamental shift in capability.

Agentic AI introduces autonomous digital agents that can plan, execute, and optimise tasks across the entire customer journey. Rather than simply answering questions, it can plan and execute tasks autonomously, initiate outreach, guide customers through journeys and determine the next best action without waiting for human intervention. In South Africa, this could also help insurers explain products in local languages, while supporting processes such as First Notification of Loss (FNOL), personalised renewal outreach, and digital Know-Your-Customer (KYC) processes.

An industry ready for change

The timing of the emergence of agentic AI could not be more significant for the local insurance industry, which is forecast to reach $13 billion by 2030. With more than 150 insurers competing for customers, the South African insurance market is highly competitive, and many products are increasingly difficult to differentiate.

As a result, price alone is no longer enough to differentiate one insurer from another. Modern consumers value efficiency and expect fast, seamless, digital‑first experiences without having to wait. Thus, customer experience (CX) has become the real battleground, shaped by how claims are handled, how policies are signed and how acquisition journeys flow. Because customers have ample choice, experience often determines not only which provider they choose initially, but also whether they remain loyal over time. Retaining existing customers is significantly more-cost effective than acquiring new ones, making seamless service delivery a strategic priority.

Major opportunity for insurers

A major opportunity in South Africa’s insurance sector is the sheer size of the uninsured population. According to the Financial Sector Conduct Authority (FSCA), only around 19% of South Africans hold insurance when funeral cover is excluded, leaving roughly 81% of the market untapped.

The scale of underinsurance is stark in monetary terms too: ASISA’s 2025 Insurance Gap Study puts South Africa’s life and disability insurance shortfall at R50.4 trillion, roughly seven times the country’s GDP, with the average formally employed earner holding only 39% of the cover their family would need in the event of death or disability.

This represents significant growth potential, not only through upselling and cross‑selling, but also by bringing entirely new customers into the formal insurance market.

The challenge is balancing this growth focus with strong retention. As always, keeping existing customers satisfied is far more cost‑effective than winning new ones, so insurers need to grow the market while ensuring current policyholders have no reason to look elsewhere.

Why conversational engagement is key

Insurers must also embrace conversational engagement through channels such as WhatsApp because it aligns closely with evolving customer expectations. Younger generations (millennials and Gen Z) prefer messaging over voice calls, and insurers must meet customers on the channels they already use.

In South Africa, WhatsApp is especially powerful – some 70% of the population use it, and it delivers a 98% open rate. This increases the likelihood that communications are read and acted upon, creating meaningful engagement rather than passive outreach.

From a security perspective, WhatsApp’s business verification gives customers confidence that they’re speaking to a legitimate organisation, reducing fraud risk and strengthening trust. Customers can have greater confidence that the organisation they are communicating with is legitimate because the verification process has already taken place.

All of this ensures that WhatsApp is a high‑impact, high‑trust channel for insurers looking to improve CX and reach people more effectively.

Barriers to adoption

One of the biggest barriers to agentic AI adoption is legacy systems and siloed data. Many organisations struggle to adopt AI because their data sits in fragmented environments, making integration complex and slow. Regulatory and compliance requirements add further complexity, as insurers must be able to demonstrate what was communicated, when it was communicated and to whom.

Data privacy and security are equally critical, as the Protection of Personal Information Act (POPIA) demands that insurers have absolute clarity about how AI systems handle personal information and ensure that they remain within the required legal boundaries.

Finally, AI governance, trust and accountability also remain major concerns. Organisations remain concerned about AI hallucinations and whether autonomous systems can perform tasks reliably without exposing the business to additional risk. Ensuring outputs are accurate, auditable, and aligned with organisational standards is essential before scaling these systems.

The competitive edge

Ultimately, everything comes back to CX. Agentic AI will make claims, onboarding, and policy interactions far more seamless, giving end users clearer information and smoother journeys. For insurers, it will streamline processes, accelerate turnaround times, and unlock meaningful efficiency gains. However, this should not be interpreted as replacing the human element. AI and people work best together, with AI improving efficiency while humans provide the empathy needed for more complex customer interactions.

The organisations that adopt these capabilities early will pull ahead, especially in a market with such significant growth potential. Agentic AI will enable more personalised customer journeys, faster service and greater end‑to‑end automation. These capabilities will help early adopters outperform competitors and establish a new standard for the industry. The key is not to wait for a perfect, large-scale solution, but to start now, start small and scale securely as the value becomes clear.

This article was written by Larissa Welman, Senior Customer Growth Executive at Infobip