The last few years have been difficult for all players in the insurance arena – clients, brokers, insurers and reinsurers.
We have had to understand the unforeseen and severe consequences of the Covid-19 pandemic, which put undue pressure on trust between all parties. Insurers and reinsurers found themselves confronted with claims for events that they had never intended to cover or factored into their rating structures, but that the interpretation of the various wordings provided cover for, even if it was limited cover. Clients and brokers found themselves fighting to have claims paid and found their livelihoods under threat. It was a bleak time for all. Trust was tested.
Tumultuous times
We are facing challenges on several fronts. Changes that were on the horizon have been fast-tracked by Covid and, in my opinion, the way of doing business has changed and continues to evolve as this new life unfolds.
Meanwhile, climate change has triggered an increase in natural disasters globally with South Africa contributing significantly to this data with respect to the floods in KwaZulu-Natal. Insurers will need to factor into our rating structures more such catastrophes going forward.
The economic impact of the riots in the last 12 months is also prolific, with the riots themselves brought about largely because of the economic discrepancies between the haves and have-nots in our society. If ever there was a time for resilience and partnership where trust is central, it is now.
While the list of catastrophes that have befallen South Africa is extensive, it is clear that we are not alone, here at the tip of Africa. The rest of the world also finds itself in turmoil. We no longer hold the monopoly on loadshedding, rioting is widespread, and inflation and unemployment are rampant, fuelling fast-approaching economic depressions. And more natural catastrophes loom on the horizon.
South Africans bounce back
But South Africans are resilient – we always seem to bounce back. As an insurance industry in South Africa, we need to do our part by fostering an environment of care and trust – a partnership philosophy.
The environment we are working in is unknown. As we move forward with little experience to guide us, this is a time to offer mindful and inclusive leadership that emanates from a foundation of trust and fosters a culture that is attentive, collaborative and efficient in order to create something that is greater than the sum of its parts. This new world seeks leadership without arrogance.
As South Africa moves towards the realisation of its Economic Reconstruction and Recovery plan, global focus on Africa describes interesting possibilities. McKinsey’s study, Africa’s Insurance Market Is Set For Take-off forecasts insurance companies will innovate across products and channels, driven by transformative trends that see collaborations enabling insurers to increasingly participate in ecosystems orchestrated by others and reach beyond their platforms into other fields and new markets.
It is also interesting to note that the study indicates Africa’s insurance double-digit growth in recent times was driven primarily by economic growth rather than deepening market penetration by the insurance sector. This presents a real and very significant opportunity for our industry that, coupled with the wave of acceleration in digital transformation across the continent, will deliver fresh and exciting strategic partnerships across different sectors.
There is a strategy behind successful partnerships. It requires focus and structure, clarity and consistency in communication. Partnerships are evolutionary, and this calls for regular reassessment and adjustment. Resilience, passion and commitment are fundamental to successful partnerships in what is essentially a human ecosystem. But the golden thread that runs through all the change, disruption and uncertainty is trust. We need to continue to build trust and earn trust.