Our last IIG Insights session for 2023 culminated with a highly informative session sponsored by our partner Bryte Insurance. Education Portfolio Head, Tebogo Raphathelo, welcomed all IIG members & non-members to our very last session for 2023. We were prepared for a robust discussion facilitated by our Bryte panelists.
Our first speaker, Liza Morris is the Regional Manager of Bryte in the Western Cape and a past President of the Insurance Institute of the Western Cape (IIWC). She has an FCII and has been in the industry for over 30 years. Liza started her career at Mutual & Federal, moving to Zurich and then Bryte when the company was rebranded. She has holistic experience in claims, underwriting, sales and distribution, strategy, project management, innovation, and leadership.
Liza kicked off her presentation by remarking that in a market filled with extreme events she was happy to talk about something sexy and futuristic for a change.
Skills development is certainly one of the most important priorities in any company as part of obtaining its business goals. What do we mean by 4IR? Whilst there is no real definition, it often looks at interconnected things e.g., digitisation, using digital tech across organisations. Businesses are using tech to get real-time access to Big Data. Automation helps minimise time on manual processes, AI machine learning, Chat GPT are all fulfilling niche gaps in businesses. How is tech disrupting and/or shifting ways or work? Previously companies were more product centred, but now have become more customer centric. Risk needs have become more personalised. It’s also imperative to bring staff up to speed with the various challenges of 4IR. Improving agility, tech savviness and general upskilling of staff is a moral responsibility of businesses.
Tech disruptions in the insurance industry have been driven by advancements in information technology, data analytics and changing consumer expectations.
During the very early start of tech introduction, basic business processes didn’t really change. It served more as a data-capturing tool. The emergence of the internet is what brought on real change. InsureTechs began driving things faster and driving or automotive tech advanced considerably including telematics which single-handedly changed many aspects of the auto insurance product. Block chain is also playing a role by securing and making contracts tamper-proof. AI and chatbots allow for 24hr support to customers. whilst IoT (internet of things), brought about smart homes and smart cities, who then is ultimately liable when things go wrong in IoT?
Impact on Business Models:
There is a significant shift in business strategies. According to a survey by McKinsey, more than 30% of insurance customers are not satisfied with the digital channels available, and only 20% of customers say that digital channels are their top choice for interacting with their insurer. Indicating that the industry has much room for improvement when it comes to customer experience. The rise of digitalisation and mobile technology has shifted customer expectations in the insurance industry. Tech disruptions have spurred the adoption of digital distribution channels. Insurers are moving away from traditional brick-and-mortar agencies toward online platforms and mobile apps.
Customers are changing, so who we partner with must have the relevant tech to deal with customers effectively. Consumers are driving this expectation leading to the popularity of Lemonade & Naked Insurance distributors who only use digital distribution channels. Younger people prefer to only interact through tech. Also, important to note, is the aspect of the human element may no longer be the reason behind risks like fire or accident. There must be a collaboration of tech and traditional options. $15.4b was funded towards tech innovations in insurance in 2021.
Barry Simmons then joined the discussion. Barry is a Fellow affiliated with the IISA. His short-term insurance career started in 1998 when he joined Santam, Kimberley as a claims clerk. From those beginnings, he has worked in various roles and organisations within the industry, ranging from personal and commercial lines underwriting to broking, compliance, sales, relationship management and portfolio and people management at companies such as Santam, Old Mutual Insure, Investec and Bryte.
Barry emphasised that the underwriter’s job is to ask questions and the tech allows one to capture this data.
Data is worth its weight in gold as it leads to better risk selection, less losses and ideally cheaper pricing. In 2019, 20% of claims submitted were fraudulent and these losses are not absorbed by the insurer, it’s passed down to policyholders resulting in an increase in premiums.
Barry also highlighted the Regulatory challenges as per below:
AI is a relatively new tech, and it was found that it actually has racial and gender biases. One must therefore practice caution when applying this tech.
Benefits of AI for Insurers and Customers:
Large catastrophe events can now be better prepared to absorb these cat losses. Budgeting, accordingly, enhanced underwriting and risk assessment. Fraud detection can be assessed more effectively and reduced fraud results in lower pricing of premiums. Chatbots allow customers to enjoy round-the-clock assistance and quicker responses to enquiries and policy changes.
Bryte’s final panelist was Christopher Appanah who serves as the Head of Claims Liabilities at Bryte Insurance and is the winner of The Insurance Apprentice 2023. With a background as a legal practitioner and an LLM in corporate law, his primary interests lie in insurance and leadership, and he is deeply dedicated to advancing talent development within the insurance profession.
Christopher added to the AI and customer experience discussion. He stated that personalisation and automisation are pivotal to enhancing the customer experience. Customers receive tailored service with minimal hassle. According to Accenture, consumers say they are more willing to offer personal data in exchange for more personalised pricing, offers and discounts. This data driven personalisation not only enhances the customer experience, but also reduces risks for insurers and helps in pricing insurance policies more accurately.
AI helps dig deep into mountains of info, and by tapping into these insights, insurers can create highly customised offerings which leaves customers feeling highly valued leading to loyalty and satisfaction.
AI powered automation is like a superhero offering, as it’s a service that never sleeps, no waiting and quick solutions. AI makes claims process super-fast. It also helps the insurer cut down on operational costs. Adaptability is key to the changing work environment. Employees need to change how they view their careers, and it would be beneficial to embrace change and be open to new ideas. It is imperative that one must stay relevant and successful in an evolving job market. Businesses must identify the skills gap as it is important to diminish the negative bias employees may have.
Assessment and Analysis: Identifying the Skills Employees need for Future Success:
End-to-end skill transformation typically happens through three main phases, each focusing on different aspects of kills development and enhancement. These phases are designed to provide a comprehensive approach to transform and adapt the workforce’s skills to meet the evolving needs of the Fourth Industrial Revolution.
Some of the identifiable skills are:
Smoother transitions occur with adaptable employees. Resilient employees need to see challenges as growth opportunities. 94% of surveyed executives believe that the balance between hiring and upskilling should be equal or tip toward reskilling. Allow employees to learn at their own pace. Seamless integration into existing systems leverages accessibility and flexibility which fosters continuous learning. Tech was never about replacing employees but rather to assist and get employees ready for interaction.
Liza then concluded the session with a wrap-up. In the next decade, the adoption of robotics and Industry 4.0 technologies by a growing number of companies is expected to redefine the skills requirements for the workforce, altering the criteria for in-demand talent.
- Demand for basic literacy and numeracy skills will decline by almost 20%
- Demand for technological skills such as coding will rise by more than 50%
- Demand for complex cognitive skills will rise by about 33%
- Demand for high-level social and emotional skills will rise by more than 30%
Evolving trends and comprehensive approaches:
- Lifelong learning
- AI and machine-learning
- Hybrid learning models – combination of online & in-person learning.
- Microlearning – short, focused, and easily digestible learning modules.
Mentorship and coaching are important. We need to embrace this as an industry, and we need to upskill staff for the next decade.
Conclusion:
In the face of this revolutionary moment, insurers must recognize that skills development is not a mere necessity but a strategic advantage. It is an investment in human capital that ensures employees and business partners have the proficiency to leverage these technologies for the benefit of the customer and the realisations of the broader business objectives. Ina customer-centric model, where personalisation and data-driven insights are pivotal, skilled, and adaptable personnel are the linchpin in delivering excellence and achieving sustainable success in the insurance industry.
A brief Q&A was then accommodated with the resonant statement being that in general, nobody’s job is guaranteed, but if you take the initiative to upskill, adapt and evolve, your chances of survival are certainly higher.
Thank you to our host, Tebogo Raphathelo, our panelists, and our sponsor, BRYTE.
Article Written by: Asiya Swaleh
General Manager: Business Development, Fulcrum
