The youngest insurance firm has struck deals with an Indian-based technology firm to acquire a CORE solution, joining the industrial frenzy.

Regulators at the National Bank of Ethiopia (NBE) issued a directive compelling insurance firms to acquire an automated financial management solution in the next two years. They have issued similar requirements for all 38 microfinance institutions (MFIs), granting a three-year transition period to comply.

Bunna Insurance had initiated the bidding process to acquire a core insurance system before the central bank issued the edict.

Senior executives of Bunna Insurance have picked Amity Software Systems to provide a centralised, online, real-time, electronic insurance solution, known by the industry’s lingo as a CORE. Amity’s system is expected to interconnect all 33 branches, 19 of which are in Addis Abeba. When completed, the complete project may cost the company nearly a million dollars.

Incorporated in 2013, Bunna Insurance was limited to non-life insurance policies until recently. Last year, the firm began offering its customers long-term insurance businesses of group, endowment, and mortgage life insurance policies. With a paid-up capital of 200 million Br, the insurer has 37,000 clients. Its gross written premiums reached 480 million Br, up by 43pc compared with the previous year.

Bunna Insurance executives hope the automation will enable these clients’ easy access to information on premiums and policy renewal procedures. Clients can also file claim requests remotely, says Dagnachew Mehari, chief executive officer (CEO).

Amity Software Systems has deployed its technologies in other African countries, including Kenya, Ghana, Nigeria, and Rwanda. The 36-year-old IT firm is familiar with the Ethiopian market. It entered to supply a digitalised enterprise resource management (ERM) system to Dangote Cement. Its executives say they are keen on expanding its presence.

“We’re preparing to participate in other bids,” Anil K. Saxena, managing director of Amity, told Fortune.

Dagnachew and his officers plan to obtain network infrastructure, hardware, and a database.

“We’ll float bids after receiving the specifications from Amity Software,” said Dagnachew.

Experts estimate that the spending Bunna Insurance executives are prepared to make could be on the high side compared to the company’s size. Bunna Insurance netted 34.6 million Br in profits last year.

Ebsa Mohammed, an insurance expert and manager at Alpha Consultancy, urges Bunna’s executives to ascertain the technology’s viability to cash in on the investment.