The evolution of South African insurance is a big bag filled with big, and some of them bad, topics. Tech, regulation, compliance, data… Here’s how we may just pull through, and, who knows, maybe even prosper.
For some time now there’s been talk about change. We know big change is coming for everyone in insurance. Actually, it’s been underway for quite some time. Change in the form of compliance, of pricing models, change in regulation… and the promise of ever-changing technologies that can help insurers and brokers bend and adapt to these changes. Maybe even capitalise on these times of uncertainty.
Insurance companies are continuously reviewing their risk and compliance initiatives, and these initiatives, along with the changes in regulation, filter down to the UMAs, brokers and clients. The entire industry is currently faced with implementing compliance frameworks as efficiently, effectively, and affordably as possible. And so the search is on for the best compliance practices and technologies that will enable businesses to comply with current and future regulatory requirements. But the search never stops and it becomes an ongoing need, driven by regulatory expectations and technological advances.
As regulators in South Africa begin to set strong risk management and compliance requirements, the insurance industry now has the chance to capitalise on the availability of new technology in the quest to provide the ultimate in policyholder protection and financial stability. But with technology comes risk and so too opportunity.
Regulators and insurers must take it upon themselves to review carefully the opportunities and risks associated with these new technologies, as their impact on claims, supervision and regulatory processes should not be underestimated.
Going for broker
I imagine the main theme of watercooler conversations around broker offices are of the encroaching digitisation of the insurance industry and what this means for brokers. Presumably, the synopsis by brokers for brokers is not good.
The rapid development and changes happening in artificial intelligence (AI) and insurance technology solutions are fast becoming mainstream. Insurers today are already using sophisticated analytic strategies to detect suspicious claims behaviour, and they expect of their technology suppliers to equip them with the necessary tools that would enable them to respond to market changes in an increasingly tech-driven industry.
But there’s good news in all of this.
Clients who employ brokers are looking for advice on the best insurance coverage, not necessarily the cheapest options (and if the best solution happens to the most affordable one, so be it). In turn, insurance companies are always on the prowl for brokers with intimate insurance knowledge who can help customers find the right balance of coverage and policy for their specific needs and lifestyle.
Armed with the right technology, brokers can almost instantly offer clients a range of quotes from various insurers, specifically tailored for them. Moreover, technologies can give you the leverage to leapfrog the barrage of regulatory requirements, including requirements around the exchange of data, for which compliance can prove costly to implement, and much more costly if not implemented and client data goes amiss. Our software as a service (Saas) solution, SkiHost, for instance, comes with the complete compliance adherence for smaller brokers.
It’s all about differentiation, remaining competitive, deepening your target market, and to offer your diverse client base tailored insurance solutions, doing so as efficiently as possible.
Insurtech can help the insurance industry become more customer-centric while enabling the industry access to large data. And if you haven’t noticed, Big Data’s star is on the rise and will be shining brightly for some time to come. This trend is largely driven by the staggering increase of connected devices and the data pulsing from these devices, straight into the open arms of insurers.
By utilising the latest technologies, such as mobile apps, robo-advice, the Internet of Things (IoT) and blockchain, we in the insurance technology industry can support the broker and insurer, and vice versa. In our experience, locally and abroad, brokers are increasingly partnering with technology providers to employ software as a service (Saas) platforms like SKihost in a bid to technologically transform their businesses. It hands compliance over to the technology and frees up resources so they can look after their business, which has always been centred around the client.