I’m often asked about the trends that are shaping the insurance industry. So it was fascinating to read a report from consulting firm Deloitte, ‘The four trends that will define insurance in 2020’, based on a survey of more than 200 insurance executives in the EMEA region.
Are the trends relevant to us in South Africa? 100%. If anything, I think they show that we’re up there with the best of them.
New world, new customers, new solutions
This is spot on. The insurance industry has long been ripe for disruption – and it’s all driven by customers, who want a better way of doing insurance. Old products and old approaches just don’t cut it anymore. As the report says: ‘Customers are the disruptive force in the insurance industry.’
A different roadmap for growth
I loved this sentence in the report: ‘The traditional approach of selling protective products is nowhere near enough for the insurer of the future.’ In other words: if you’re happy with single-digit growth, keep selling the same-old, same-old. If you’re looking for 40% growth a year in a tough market, you’ve got to get innovative with your products, be almost evangelical with providing customers the slickest experience possible, and get super-clinical with managing risks.
The negotiating table beckons
According to Deloitte, organic growth will not be enough in a highly competitive market. The key for incumbents is to forge alliances with innovative start-ups – and importantly, the trend is towards alliances that don’t just build core markets and product sets, but offer access to technologies that enable improvements within the industry. This is already happening in the SA market. Watch this space.
Digital disruption – practical not theoretical
So how can insurers use technologies such as analytics, blockchain and cloud to their advantage? 95% of respondents in the Deloitte survey said they see an increase in data analytics in the next three years. For me, if you’re not already well on your way to being a data company that happens to do insurance, you may be too late. The key: use technology to enable real-world benefits that matter. Like better customer experience, and better risk management. That’s the difference.