Abolishing AI theatre in South Africa. What will really transform insurers?
Gary Tessendorf, Regional Director for Sub-Sahara Africa, Sapiens
The South African insurance industry is buzzing about AI. Every board deck mentions it. But too often it’s just “AI theatre”: impressive demos layered on top of old systems, now running in the cloud. Moving legacy technology to a new infrastructure isn’t transformation. And sprinkling generic AI tools across fragmented platforms won’t help.
Real growth in the market will come from outcomes delivered faster, at scale. That is where true AI, when combined with micro-vertical SaaS technology, shines.
Across the continent, insurers are under pressure: new digital-first entrants, rising customer expectations, regulatory complexity, and thin margins. In this environment, four truths have emerged:
- Customer journeys matter more than systems
- Speed beats perfection
- Industry depth outweighs generic technology
- Execution matters far more than intention. Strategy without cadence is just theatre.
Beyond cloud: why modernisation alone isn’t enough?
For more than a decade, insurers globally have focused on modernisation through cloud adoption. This shift improved resilience, scalability, and cost structures. But it was never sufficient.
Cloud does not understand insurance. Software does.
Sapiens’ experience in the local market over the past ten years has made this clear. When we first entered the region, we worked with a small number of select customers. Today, our footprint has expanded across the continent, and we now support a broad spectrum of insurers – from bancassurance and short-term insurance to fully underwritten life products, simple funeral policies, annuities and group risk.
That growth has not been driven by technology for technology’s sake. It has been driven by a deep understanding of the unique realities of the market and the ability to adapt solutions accordingly.
Why horizontal platforms hold insurers back?
One of the biggest constraints on transformation is the belief that insurance is a single industry with configurable variations. Short term insurance, life, wealth and retirement, and reinsurance are fundamentally different businesses.
They operate with different economics and risk models. They face different regulatory obligations. They run at different operational cadences. And they require different data, analytics, and reporting capabilities.
Trying to serve these distinct industries with horizontal platforms or lightly adapted software? Customisation efforts grow. Innovation slows. Costs rise. And transformation stalls, because the software must constantly customised.
Micro-vertical SaaS changes the equation…
What micro-vertical SaaS really means?
Micro-vertical SaaS is not about templates or configuration layers. It is about building platforms that are purpose-built for specific insurance domains.
That means software and AI designed around core industry workflows, aligned with regulatory and compliance realities, and embedded with deep domain intelligence. It means platforms that evolve continuously alongside the industry.
In short, the software reflects how insurers actually operate.
When this depth is delivered through a true SaaS model, the benefits compound: faster time to value, lower total cost of ownership, built-in regulatory updates, and global scalability without local complexity. More importantly, it creates the foundation for AI that actually works.
AI without theatre: from hype to outcomes
Several years ago, technology adoption was a push in South Africa – insurers needed convincing. Today, the dynamic has shifted.
AI is now at the centre of conversations. But its impact depends entirely on context.
Generic AI layered on top of fragmented systems delivers limited value. AI embedded within micro-vertical SaaS platforms is different. It has access to structured, industry-specific data. It understands workflows, policies, claims, and regulatory constraints. That is when AI can shift from theatre to transformation.
Sapiens is integrating advanced AI capabilities directly into our platforms and bringing them to insurers. The potential is enormous: natural language policy queries, faster and more accurate claims processing, proactive customer engagement, and streamlined operations across the value chain.
This is not about futuristic promises. It is about practical outcomes delivered faster, at scale.
The real battleground
The future of insurance will not be won on infrastructure choices or AI slogans. It will be won on customer experience, speed of execution, and the ability to translate deep industry knowledge into scalable platforms.
AI plus micro-vertical SaaS is not a nice-to-have. It is the accelerator. The era of AI theatre is ending. The era of execution has begun.
