Prior to the Covid-19 health pandemic, the insurance industry had, for a considerable number of years been tipped to be a prime candidate for disruption largely because of its perceived rigidity and heavy reliance on traditional business models.
It is not a secret that insurance players have been picking signals all along of the impeding disruption. The industry pilots have been firmly warning the players of an imminent bumpy patch ahead. Some of the strongest signals of an industry that is clearly at a tiping point of a major technology driven evolution have been the proliferation of insuretechs and fintechs. These have been premised on digital apps and online delivery channels that are well aligned to the rapidly changing consumer behavior and preferences.
Just as the insurance players were warming up to this indisputable reality of a rapidly changing market place and progressively dedicating sizeable investments into modern technologies, tinkering with some digital platforms and automations, the pandemic checks in, fast and furious.
Long held and deep rooted traditions, ways of life and work have all suddenly changed. The reality of working from home, reduction in the use of physical documents, movement restrictions, social distancing; all have presented major and immediate implications on the operations and delivery of insurance services. Faced with this sudden reality, the insurance industry, like many other sectors of our economy, has responded strongly with faster roll-out of digital driven solutions, value proportions and service to the insuring public.
Notable examples areincreased mobile insurance apps, wider uptake of digital motor insurance certificates and e-commerce driven self-service platforms. Leading health insurers such as UAP Old Mutual have recently roled out telemedicine solution whereby diagnosis and treatment is delivered via an online platform. This is then complemented by “meds-on-wheels” solution whereby the prescribed medicine is delivered at the doorstep of the customer, a value that is achieved through a business partnership between UAP Old Mutual and Livia Dawa Limited. The up-take has been quite impressive. Clearly, this is just but the beginning of what our famous Kenyan informatician, Sam Wambugu, calls “digital wave of today and the future”. Perhaps, more than ever before, the so called digital wave that is sweeping across all sectors of our economy is fast ushering in a major and compelling conceptual moment. Traditional, rigid business models and organizational structures are giving way to those that are agile, resilient, less costly to run and dorminantly, modern technology that are digitally driven. Digital skill set for the human capital coupled with up-skilling and re-skilling, modern leadership style and corporate governance, rapidly changing consumer behavior and increased awareness are all crital imperatives that organizations have to quickly conceptualize, embrace and harness.
There is a clear upside to it; digital solutions are not limited by traditional physical, geographic, demographic and social barriers some of which have for long contributed to the subdued uptake of insurance. This then means that potential mega opportunities for business growth and insurance penetration awaits those that are going to figure it out faster and capture first mover advantage. Covid19 has compelled us all to think faster and embrace this so called digital age earlier than we thought .
Another key imperative is that no single organization will perhaps do it alone. It calls for taping into other established eco-systems such as banks, aggregators in different sectors, co-creation of customer solutions and, bundling of value propositions that are digital driven. Partnerships with a blend of specialists such as digital professionals in the value proposition creation journey without losing your corporate identity is clearly the way to go.
It is also encouraging to note that our regulator, the Insurance Regulatory Authorityhad somehow seen it coming much earlier and provided licensed insurance players with a sandbox for testing digital driven products and solutions within a regulated environment.
It would be apt for me to sign out with a famous quote by inspirational writer, H.Jackson Brown, Jr. “when you can’t change the direction of the wind – adjust the sails” . Without a doubt, our insurance industry is “adjusting the sails” decisively.
David Kuria is the MD of UAP Old Mutual Kenya General Insurance Business