Big risk focus at InsureTalk35

More than 4 000 insurance professionals registered to attend CN&CO’s popular insurance webinar, InsureTalk35, which took place online on 24 August 2023. The event was headline sponsored by Old Mutual Insure, who also fielded a number of speakers to unpack the theme “Navigating the future: unleashing innovation and insight into the evolving insurance landscape”. 

Our first speaker for the day was Antonia Oakes, executive of customer experience at Old Mutual Insure. She spoke about trends in customer experience now and in the future.

“Customer experience has really taken over the short-term insurance industry,” she said, “and it looks set to take over the world!” 

Antonia set out the differences between customer experience (CX) and customer service. 

“CX is the perception that customers have of an organisation, one that is formed based on interactions across all touchpoints, people and technology over time,” she explained. “It incorporates customers’ cognitive, affective, emotional, social and physical responses to the brand and is generated through both functional and emotional behaviours.

“Customer service is more operational. It is not the totality of customer experience. It is a business function that is the focus of a specific group of employees focusing on the resolution of customer requests, issues and answering questions. It is one of the factors that impact customer experience.”

Antonia went on the share the customer experience trends across industries and around the world.

“Customers evolve,” she said, “We as the short-term insurance industry have to be flexible enough to adapt to our customers – what their needs are, what they want to be protected from an asset perspective, what their risks are, how the macro- and micro-economic factors impact them… all this needs to be taken into consideration. We need to understand them in their total being.”

Antonia made a number of CX predictions, including:

  • Conversational service will be dominant and proactive
  • All service will be artificial intelligence first (although AI will not replace humans entirely)
  • Customers will drive all service
  • It’s not about having all the data; it’s about doing the right things with the data
  • Every business will live and provide conversational support everywhere you are
  • AI will replace the majority of frontline interactions
  • Hyper-specialised support will be available for everything (at a price)
  • Conversational service will be dominant and proactive

And here are some insurance customer trends:

Following Antonia was Jerry Anthonyrajah, chief commercial officer at OMI. Jerry spoke on applying advanced analytics and innovation in insurance. He says insurer profits are under pressure, with only three players enjoying 57% of industry profits. 

“Everyone needs to find a way to be more financially sustainable and profitability is key, he said. “And while there are lots of other levers that you need to look at, like customer experience, applying advanced analytics and innovation is vital.”

He pointed to a McKinsey survey in the EMEA region, which measured how advanced insurance companies are in applying advanced analytics in their companies. South African insurers, he said, still have a long way to go. 

In order to set up advanced analytics in your organisation, you first have to get the building blocks in place. Then you have to understand where you believe data can add real value in your business. “Think value chain,” he said, before unpacking the focus areas of distribution, pricing & underwriting, claims and operations in terms of data and analytics. Jerry went on to discuss the various skill sets that are required for data analytics, provided an overview of generative AI – over and above ChatGPT – and shared four use case genAI archetypes which insurers are developing.

“You need to decide where you want to focus on when it comes to innovation,” he said. “Then decide how you want to unlock it – and consider your partners carefully.”

Delegates were treated to the replay of a radio interview with Thokozile Mahlangu, CEO of the Insurance Institute of South Africa, talking about what the insurance industry is doing to help improve literacy among children. We also watched a recap video of the 2023 African Insurance Exchange, which took place at Sun City and online at the end of July. 

“Next year we will be celebrating 50 years of hosting this conference,” she said. “You don’t want to miss it!” (Visit AIE2024.com for more info and to register.)

Thokozile was followed by FA News editor Rianet Whitehead, who spoke about the August (published) and October (upcoming) editions of FA News, the 10th season of The Insurance Apprentice (applications close on 30 September!), industry events during Women’s Month, a fun and interesting look into a possible future of insurance, as well as upcoming events in the industry. 

Our entertainment came from Cape Town-based singer/songwriter John Niel, who performed a few soulful numbers accompanied by his guitar.  

Thabile Nyaba, chief risk and sustainability officer at OMI, spoke on risk trends. 

“When talking about the risk landscape, it’s very easy for us to be overwhelmed by negativity,” she said. “But risk is about both threats and opportunities. Many times we forget to look at the opportunities, which lie just beneath the surface of the risk. Victory comes from finding the solutions in the problems. 

For instance, the energy crisis has accelerated the transition into green energy and innovation.

Thabile pointed out that there are many crises happening at the same time. They are interconnected and compounding. They are repeating themselves – nothing is new – and they are increasing in severity and frequency. 

“The severity of weather-related claims, for example, has increased 10-fold in the last decade,” she pointed out. “Floods, wild fires and severe storms remain the highest occurring natural perils.

“The good news is that we have the playbook of these scenarios. We can learn lessons and take advantage from the countries that have navigated this, including ourselves. We need to take advantage of being part of the global network where the information is readily available to prepare ourselves. These days it’s not about trying to speculate what the risk is going to be. It’s about being prepared.”

Thabile discussed the top risks in South Africa in 2023 and their impact on the insurance industry.

“There are things that we as an industry should be doing,” she said. These include enhancing our modelling capability, building our resilience muscle,  embracing digital transformation, upskilling our people, promoting financial inclusion, diversifying products, increasing reinsurance capacity and striving for sustainability.

“We have to think and act differently if we want to land our organisations into the future.”

Daphne Sitole is a senior property underwriter in the facultative business unit at Munich Re South Africa. She shared a reinsurer’s view on trends, opportunities and challenges in the market. Her talk focused on climate change, catastrophe in the Southern African region, and current challenges in the local market. 

Climate change, she says, can’t necessarily be felt.

“You won’t feel the difference between 16 degrees and 17.2 degrees on the street, for example,” she said. “However, global warming – even this 1.2 degree temperature rise – increases the probability of extreme temperatures and new extremes, as we have experienced globally in recent months.” 

Daphne discussed the physical and economic impacts of global warming to the end of this century as they appliy to physical impacts (sea level rise, coastal assets to defend, frequency of extreme rainfall and increase in wildfires) as well as the economic impacts (stranded assets, food supply and opportunities for insurance) and outlined the major natural catastrophe events that took place around the world in 2022 – totalling US$270bn!

She highlighted natural catastrophe losses in the Southern African region – including the Covid-19 pandemic, the 2021 July riots and the 2022 KZN floods – and the resultant response from the insurance and reinsurance markets. She concluded by examining the concept of grid interruption globally and in SA, as well as the insurability of grid failure. 

Christelle closed the webinar by reminding guests to register on the InsureTalk CPD portal, where CPD certificates are stored in perpetuity. 

And then… have you registered for InsureTalk Live? Our first live edition will take place on 26 October 2023 at The Venue in Melrose Arch. The event will also be broadcast online (for free!) for those who can’t make it to the live session. This is a great opportunity to network with your insurance peers, learn more about this fascinating industry and earn some CPD hours in the process. If you would like to find out more, click here.

InsureTalk36 will take place on Thursday, 21 September 2023 from 10am to 1pm. Attendance is free and will earn you 2.5 CPD hours. You can register here.

 If you would like to watch the recording of InsureTalk35, click on the video link below: