What's Happening?

Going Digital



Farhaana Baartman, Head of Marketing and Customer, Hollard Life Solutions

The insurance industry has seen accelerated digitisation and adoption of smart technologies and a gradual shift away from a product-driven industry to a sector that offers more bespoke and personalised solutions to its customers.

Digitisation has become an operational imperative for survival. So, how is digitisation changing the face of the insurance industry? How is this beneficial to the consumers? What are the new trends that are emerging? cAnd what are the barriers that need to be overcome to ensure the inherent benefits that are being brought about by this new era are fully realised?

There is growing evidence that as consumers become more tech-savvy, correspondingly they also become more discerning and demand quick turnaround times. Armed with unfettered access to information, the scales of power have tipped in favour of the consumer.

This shift in power dynamics away from insurers to the consumers has created expectations for tracking visibility and quick turnaround times for claims processing.

The more insurance companies automate their processes, the quicker they can process claims and improve customer experience. The digitisation of the insurance sector also gives insurers the opportunity to gain access to data, which provides them valuable insights, allowing them to develop tailored products that better meet their customers’ needs.

The outbreak of Covid-19 has marked a clear break with how the insurance industry has done business in the past. The industry is going to have to look at insurance differently and be flexible to adjust the cover and match their consumer’s peculiar risk profile.

For example, we expect to see the evolution of products such as day cover solutions that can provide short-term cover for a brief duration. This could be applicable to short-term cover when travelling. The introduction of such innovative products is possible if the sector has the actuarial models and the technology that supports them.

A growing trend in financial services is cross- industry collaboration and partnerships between different stakeholders within the sector. Insurance and fintech companies are forging partnerships with retail stores to offer multiple services to customers at the point of purchase.

These partnerships foster financial inclusion by opening financial services to millions of unbanked and underbanked people.

While digitisation presents many opportunities for the financial services sector, its impact on unemployment remains a pertinent question. In a country that is battling massive unemployment, there are legitimate concerns that the increasing digitisation of the economy may displace employees, and in the case of the insurance industry, nullify the need for intermediaries.

Digitisation can never be a substitute for face-to-face engagement. Research and anecdotal evidence show that there will always be customers that prefer to engage with a broker for advice, particularly on products that are complicated or require expert advice. By talking with a broker, these customers want a sense of comfort knowing that the business can assume its fair share of responsibility by sharing the knowledge of what they need to be covered.

Customers do not want to make important financial decisions all by themselves. They want to know that they have an expert that understands what the future might bring, and who will give them expert advice so that they make informed decisions.

It might be easier to buy funeral cover using digital platforms, but when it comes to products such as disability or retrenchment cover customers often require an expert who will guide their decision.

Digitisation is never going to replace our brokers, nor will it dislodge our call centre agents, as there is only so much information and possible responses that bots and other self-service channels can provide.

While the road to digitisation is imminent, it is equally important that the industry should have the fundamentals in place. Therefore, ease of use of self-service and digital channels should form the cornerstone of the systems that support digitisation. Successful self-service channels include those that have simplified processes to make the claims process as efficient and stress free as possible.