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2018 FIA Summit recap: Advice 2020 and beyond

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Brokers, UMAs, advisors, insurers, service providers, media – and some who walked in by mistake – gathered at the Sandton Convention Centre on 12 October 2018 for one of the industry highlights of the year: the 2018 FIA Summit. This year’s theme was Advice 2020 and beyond, and the speakers and exhibitors provided incredible insight and advice around the theme.

It was fantastic to see our members in one room, together with our partners – Bidvest Insurance, Global Choices, Hollard, ITOO Special Risks, Lombard Partnerships and Santam – and exhibitors – Tracker, Infiniti Insurance, Genasys, Emerald, EasyEquities, MUAPG Glass, Sasria, Chubb, 1Life, Elite Risk Acceptances, FMI, Oakhurst, Constantia.

2018 FIA Partners

This year the format was a bit different from normal. The A-type personalities were a bit stressed out by the fact that the agenda wasn’t published beforehand, but they got over it once the programme kicked into action.

“The main objective of the summit is for us all to learn and be challenged,” said Carel Nolte, head of our communications partner, CN&CO, who emceed for us at the summit. “Everyone in this room today will find something useful in the programme to help grow and build your business.”

FIA president, Peter Olyott, opened the summit by welcoming guests and highlighting the impacts of change on our industry.

“I am also heartened to see a room full of people who represent offerings from across the financial spectrum,” he said,  emphasising the fact that advice is key across the industry.

Sam Williams, FIA’s head of legal and regulatory affairs, gave a fascinating talk on the future of regulation in SA.

“Times are confusing,” she said, “but it is temporary.”

She said as an industry we understand the need for regulation, but we tend to make things too complicated. As such we are left overwhelmed by the volume, scale and pace of change.

“The industry should remain as engaged as possible,” she said. “It’s always more helpful if we engage while conversations are happening, rather than waiting until the very end of the process. It’s vital for members to provide feedback to FIA in good time – and for the FIA itself to continue building relationships with regulators.

“Change brings us opportunities to reshape the landscape in which we operate. The challenge is to keep pace.”

Sam Williams, FIA’s head of legal and regulatory affairs

Justin Naylor, MD of ITOO, gave a fascinating insight into the world of high-value collectables and the things insurers and brokers need to consider when underwriting these collections.

“If you’re a billionaire and you really want something, there’s no limit to what you’ll pay,” he said. “In general collectibles such as cars, wine and art, appreciate in value. In the past 10 years the JSE Alsi returned 95%. Cars returned 289%, wine 147% and art returned 25% in the past 12 months alone.”

In terms of advice, brokers would be well advised themselves to check where their HNW clients’ collections are insured. Justin recommends placing them with a specialist insurer, rather than listing them in a general policy or binder agreement.

Justin Naylor, MD of ITOO

Justin was followed at the podium by Ntombi Langa-Royds, who gave an insightful talk on the value of conversation in life and in business.

“Without conversations, we misunderstand each other,” she said. “We misalign in terms of what we do. The way we give instruction is important. If there is no understanding between people, our growth is stunted and we fail to innovate. Remember, two monologues do not make a dialogue.”

Ntombi believes the conversation is the relationship.

“You guys are all about relationships,” she said, “so if you can’t talk to people, you do not have a relationship with them. There’s no doubt that relationships are hard work, but they’re made easier when we can talk to each other.”

She also highlighted the importance of diversity.

“Difference is great. It is synergistic. Embrace it. Use it to enhance conversations, rather than to hide away from them.”

Our favourite comment from Ntombi, “We need to make every day feel like Friday!”

Ntombi Langa-Royds

Veteran journalist Derek Watts gave an entertaining talk on “the parabola of technology” through his career, courtesy of our partner Bidvest Insurance. Guests had a lot of fun measuring up against Derek, who stands two metres tall, at the Bidvest Insurance stand.

In his address he shared his story in relation to the technology that was available at various stage of his life. In his early career he sold photocopiers, plastic bottle moulds and plastic bottle moulds before becoming a cadet reporter for the Herald in Zimbabwe.

“I used an old Olivetti typewriter with carbon paper,” he recalled. “The type was set in lead and put onto the printing press.”

Later he joined the SABC and then Carte Blanche in 1988 – 30 years ago! Guests were treated to a retrospective video on some of the highlights on Carte Blanche over the years.

(For those avid readers out there, Derek recommended The Four by Scott Galloway, which takes a look at the Big Four tech companies in the US: Apple, Amazon, Facebook and Google.)

Veteran journalist Derek Watts

Anthony Morris of URUP was next at the mic, sponsored by our partners Lombard Partnerships.

“There is so much unwritten business out there,” he said. “You have to think laterally and go out and get it!

“Brokers are not in the solutions business. You’re actually in the problem business. So what problems can you identify in your clients’ lives that you can help to solve? It’s important to stay relevant to avoid being replaced by a robot or a cell phone company. You have to intrigue people; give them an ooooooooh moment; disturb the status quo. Right now people’s wealth is far outstripping their financial intelligence. Brokers and advisors have to help their clients to have enough money at the end of their working lives to see them and their families through their retirement – and not just for 53 days, as was the case with someone I know.”

Anthony also gave a book recommendation: Estate Planning Through Family Meetings: Without Breaking Up the Family by Lynne Butler.

“Buy 100 of them and hand them to your clients,” he said. “They will thank you for it!”

Anthony Morris of URUP

And then… yoga. Yip, you heard right. Patrycja Mochocka of Thrive Yoga Studio in Norwood had a roomful of 500+ insurance folks doing stretches a breathing exercises in their seats. It was really awesome! (Ask anyone who was there.)

Health remained on the agenda as Butsi Tladi, head of the FIA’s Healthcare committee, spoke about the vagaries of the healthcare industry.

“Economic principles don’t seem to apply in private healthcare,” she said. “Price doesn’t necessarily come down when supply increases. A lot of this has to do with the fact that we don’t negotiate on price with our doctors. When you’re sick, you just want to get better!” 

Butsi gave a fascinating talk on the impending NHI legislation and the Medical Schemes Amendment Bill.

 The two main take-outs for brokers:

  1. Our two-tiered health system is just not working. We need to change course to ensure sustainability
  2. The need for intermediaries will remain!

“The role of advice stays,” she said. “Even the most simple medical products are complicated in layman’s terms.

Butsi Tladi, head of the FIA’s Healthcare committee

Butsi was followed by Bonang Mohale, CEO of Business Leadership SA and board member at Hollard, courtesy of our partner Hollard Insurance. He spoke about what CEOs should actually be concerned about when trying to go to sleep – and what the insurance industry should be doing to create a South Africa that truly belongs to all its people.  

One of our biggest problems right now is our inability to implement.

“If there was an Olympic sport for developing plans, SA would win gold,” he said. “The National Development Plan was the best plan we have ever made because we had buy-in from so many quarters – business, government, labour and civil society. But we failed to implement…and then made many subsequent plans, which also never came to fruition.”

Bonang discussed the importance of SEOs in our economy, the need to streamline unnecessary expenditure (particularly on our bloated government), changing the national dialogue to be more positive and patriotic, wiping out corruption, reducing debt and joining hands with ordinary South Africans to form an active citizenry.

His went on to talk about land – reform, redistribution and development – transformation, our current fiscal crisis and themes for growth, jobs and education. So, basically everything wrapped up into a compelling half-hour – which was refreshingly positive and optimistic, despite the potential to go all dark and gloomy, given the subject matter.

Bonang Mohale, CEO of Business Leadership SA

Our partners at Santam brought us the next speaker, Brett St Claire, who talked all things tech. He had the delegates rapt with stories of his first Google Home device and how it changed his whole family dynamic.

“Do you ever get the feeling that you just can’t keep up anymore?” he asked, to many nods from the floor. “It’s because we operate in a linear fashion, but progress is exponential. You can’t go forward in a 1-2-3-4-5 type of fashion. You have to go from 1-2 -4-8-16-32 and so on. Think about the progression from floppy to stiffy to CD-ROM to thumb drive to the cloud.”

Brett’s three pieces of advice:

  1. Understand what’s not going to change. We are still dealing with humans going through a point of crisis when they need insurance products to work. The industry needs to move forward with empathy.  

  2. Understand what technologies impact our businesses, and where. Artificial intelligence will help us do things better and faster. Blockchain will change the way we do business. But neither will replace humans – only augment us.

  3. What do you do about it?

Brett St Claire

Wimpie van der Merwe – serial entrepreneur and head of FIA partner Global Choices – says it’s time for insurance brokers to connect the dots of their digital reality

“We are blind sometimes to the possibilities we sit on. We get comfortable. It’s time to challenge the conservative practice of risk mitigation and focus on customer needs.

“A shift is sweeping through the industry, but we need real people all along the value chain. We need to be connected AND wired to care. Empathy is the foundation of design thinking, which lies at the heart of what we do. Empathy helps you to understand your clients’ needs. Companies who master the art of empathy are able to disrupt the worlds in which they operate.”

Wimpie van der Merwe

Ronald Gall gave a demo of one of Global Choices’ products, available through Claim Central Africa, which allows a client to connect via smart device to show exactly what is going on at the scene of a claim or potential claim.

“It all happens in real time,” he said, “allowing the service providers to see exactly what resources need to be dispatched to keep damage – and risk of further damage – to a minimum.

“Risk events do not keep office hours, and technology is available 24 hours a day.”

The robo-advice panel, comprising Grant Locke of OUTvest, Peter Olyott of Indwe Risk Services, Pieter Erasmus of Ctrl and Sarina de Beer of our awards research partner Ask Afrika, participated in a lively discussion, facilitated by Carel Nolte, on the relationships between digital and human advice.

The overwhelming sentiment was that digital advice doesn’t mean disintermediation. The robo element provides the heavy lifting, leaving advisors to handle the human element.

Tech brings speed and convenience for consumers, which is important, but there is a difference between advice and guidance. Advice comes bundled with a recommendation, while guidance is less specific.

There’s a difference between what an algorithm can do and what a human can do. These distribution channels can and should complement each other, rather than strive to replace each other.

Robo-advice is augmented advice. But we still need relationships.

Panel discussion

Natasha Goring, MD of the Automatic Fire Inspection Bureau (ASIB) provided food for thought with actual case studies and videos of the devastation that fire can cause when not controlled properly.

“Even though a building might be code compliant, it might still not be a desirable building,” she said. “The national building regulations themselves state that they (the regulations) don’t cover absolutely everything. So compliance with the code doesn’t necessarily mean a building is safe. Protection of people is paramount!”

Natasha also talked numbers, saying that the value of a claim is often as much as five times higher than the damages estimated by the fire services.

“They only estimate what they can see,” she said, “but the cost to rebuild, the loss of income, the damage to property and loss of life add substantially to the total claim.”

Natasha says the best course of action for businesses is to install a sprinkler system that goes beyond the code.

“Even though it might cost more upfront, the savings can be massive in the event of a fire.”

Natasha Goring, MD of the Automatic Fire Inspection Bureau (ASIB)

FIA partner Sasria’s Letlhohonolo Tau gave a delightful talk on the state of the industry in a changing environment. He listed threats to growth as over-regulation, uncertain economic growth, social instability and unemployment.

“On an annual basis we usually get 2000 to 3000 claims a year,” he said. “In the past six month we have had 2600! Social instability is on the rise and it’s not showing any signs of slowing down.”

He listed business threats to growth as:

Speed of technological change

  • Availability of key skills
  • Cyber threats
  • Changing customer behaviour
  • Lack of trust in business

To combat these threats, he said, we need:

  • Organic growth
  • Reduction in costs
  • New strategic alliances
  • Collaboration with entrepreneurs

“We need to collaborate with entrepreneurs in many spheres,” he said. “That’s how jobs will be created. Not by government.”

And then it was time for beer. Jan Braai, founder of the national phenomenon of Braai Day (which coincides with Heritage Day each year), was once an auditor. Now he braais and talks about braais, writes books about braais, drinks beer, and closes summits.

Letlhohonolo Tau, Sasria

“Braai is a word we use in all 11 official languages and there is no South African who hasn’t been to a braai,” he said. “The point of Heritage Day is to create a combined heritage for the next generation. We desperately need to find a combined heritage and  not focus on what separates us. I campaign on what unites us. We need to shut the country down, like St Patrick’s Day and Thanksgiving do. We need to be flying the national flag in our gardens. We need to be lighting fires and talking to each other around them.

And, most importantly, he says corporates should be sponsoring braais instead of sport.

“In sport, you might end up backing the losing team,” he says. “But when you braai, you can’t lose. Everyone wins at a braai.”

Jan Braai

And everyone wins when the attend an FIA Summit!

Big thanks to all our partners, exhibitors and sponsors. But most of all, thanks to our members for supporting this important event and participating in the ensuing conversations.

If you missed the summit, don’t fear. We will be publishing full podcasts of the presentations on our blog soon. Keep your eye on our website and social media – Facebook, LinkedIn and Twitter.