How do USSD insurance services work in Zambia?

What USSD is

USSD (Unstructured Supplementary Service Data) is a session-based text protocol built into GSM networks. When a customer dials a short code, the network opens a session with the service provider's system, which returns a numbered menu. The customer replies with a number, and the exchange continues until the task is done or the session times out. Because it uses the signalling channel rather than data, it works on any phone with network coverage.

What insurers offer over USSD

Typical menus cover the everyday tasks a policyholder needs.

• Buy or activate a product, usually funeral cover or another simple, low-premium policy.
• Check policy status, next premium due date and cover amount.
• Pay a premium, either by triggering a Mobile Money prompt or by confirming a wallet payment.
• Register a claim notification so the insurer can follow up.
• Update a phone number or request a call back from an agent.

How a USSD service is set up

An insurer obtains a short code through the mobile operators, or through an aggregator that already holds one, in line with ZICTA's regulation of telecommunications numbering. The insurer's core system, or a USSD gateway in front of it, must then answer each session step quickly and consistently across MTN, Airtel and Zamtel. Menus should be short, because sessions time out and every extra step loses customers.

Linking USSD to the policy system

A USSD menu is only useful if it reads and writes live policy data. Checking a balance must query the actual policy record; paying a premium must update the premium schedule and issue a receipt; a claim notification must create a real claim record for staff to act on. This is why USSD works best when it is a channel of the insurance ERP rather than a separate system that is reconciled later.

USSD versus apps and WhatsApp

USSD reaches every phone but is limited to short text menus. Smartphone apps and WhatsApp allow documents, photos and richer conversations but need data and a capable phone. Most insurers use them together: USSD for reach and simple tasks, an app or WhatsApp for document-heavy tasks such as claims. Our article on digital insurance in Zambia compares the channels.

Customer protection and data

Selling insurance over a short menu means disclosure has to be clear and concise: what is covered, what is excluded, the premium and the waiting period. Insurers remain subject to the Insurance Act No. 38 of 2021 and to the Pensions and Insurance Authority's requirements whatever the channel, and customer data captured over USSD falls under the Data Protection Act No. 3 of 2021.

How Ontech LifeI ERP handles this

Ontech LifeI ERP includes a USSD channel connected directly to the policy, payment and claims modules, so menus read live data and every action is recorded. Details are on the insurance USSD page.