New Fund Targets Startups Using Digital Tools to Close Africa’s Insurance Protection Gap

November 29 2025 - FSD Africa, an organisation that works to strengthen financial markets across the continent, has launched a new venture fund aimed at boosting innovation in Africa’s insurance sector. The fund will focus on early-stage insurtech startups that use technology to make insurance more accessible, affordable and relevant to underserved communities.

The fund, known as the 3i Fund, comes at a time when insurance penetration across Africa remains extremely low. Many people do not have even basic insurance, leaving households and small businesses vulnerable to unexpected shocks. While a growing number of startups are developing modern, tech-driven insurance solutions, many of them struggle to access the early funding needed to test and scale their ideas. FSD Africa says the 3i Fund is designed to close this financing gap.

The new fund will invest in startups working on areas such as climate resilience, health coverage, agriculture insurance, and digital delivery models that make it easier for people to understand and buy insurance using their phones. These innovations are especially important as Africa faces rising climate-related risks and increased pressure on household finances.

The 3i Fund builds on the progress of FSD Africa’s BimaLab Accelerator Programme, which has supported more than 135 insurtech startups across 28 African countries. Many of these companies create simple, flexible, low-cost products tailored to informal workers, smallholder farmers, and low-income families. The new fund will provide capital to promising BimaLab graduates as well as other startups with high potential for scale.

To finance the fund, FSD Africa Investments will provide catalytic junior capital, while commercial and strategic investors such as Zep Re will supply senior capital. This blended structure is designed to attract more private investors into the insurtech space by reducing perceived risk.