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Category Life Insurance

Revolutionising insurance: the power of digitisation

02 July 2024 Myra Knoesen

Digital transformation has dramatically changed the way people transact in everyday life, whether to do shopping, book accommodation, or to communicate.

In a similar fashion, the life and health insurance industry is transforming. Insurers are increasingly harnessing technology to create new ways to engage and transact with clients to improve the services and products that they provide.

The need for digitisation and digitalisation

Joretha Bothma, Head of Product Development, Underwriting and Claims at Momentum Life Insurance says that clients are increasingly demanding and seeking direct access to their financial service providers for transactions and information. The need, therefore, for digitisation of processes is becoming increasingly pivotal in the long-term insurance industry.

“Digital tools offer agile and innovative life insurance providers opportunities to grow, which are ripe for the picking. Research reveals that two-thirds of consumers across age and income brackets are open to receiving virtual advice, and more than one-third would prefer to conduct the entire onboarding process online. In addition, more than 80% of clients are open to share their personal information with a life insurer to obtain a better price,” she said.

Bothma added that the consumers who strive to stay fit and healthy continuously seek to enrich their knowledge about their physical fitness and health and use their insights to improve their financial wellness. She says this wellness awareness is specifically heightened by the availability of wearable data solutions as well as health and wellness apps.

“Despite – or perhaps because of – the volatility of the external environment, over which people feel they have little control, they are keener than ever to take the management of their health and fitness into their own hands, as it is something they can control, and they’re using technology to do it,” she said.

Emerging digitalisation trend

In this age of digitalisation, Bothma said the sharing of personal data is becoming better understood, protected and regulated. “Clients are more open to input and feedback from their insurers, based on the industry’s risk expertise, and they welcome incentives to take positive behavioural steps to improve their risk profile.”

“In response to this emerging digitalisation trend, a life insurance provider recently launched two innovations that are very much aligned with this thinking and global practice. This first-in-industry technology has transformed life insurance assessments and onboarding by leveraging existing smartphone technology that is widely accessible to most people. A digital health assessment, utilising this technology, for example, is used to accurately assess a client’s health in less than two minutes. These insights, combined with a few additional questions relating to height, weight, medical scheme membership and fitness level is used to immediately calculate and offer clients personalised discounts on their monthly life insurance premiums’, said Bothma.

According to ReMark’s Global Consumer Study for 2022/23, consumers are keen for engagement and education on all insurance products and are willing to leverage advances in technology. Particularly the younger generations – Gen Z and Millennials – are enthusiastic about embracing technology and the dynamism that the future insurance landscape could offer. “This is good news for any future-minded players in the sector, who are willing to invest in educating their consumers in risk and insurance, and in building a dynamic engagement ecosystem that benefits consumers in an informed and sustainable way,” she continued.

Creating the best consumer experience

Change in the insurance industry, according to Bothma, has historically been slow and required more time for adoption. However, adopting change is only a matter of time and companies that can most effectively take advantage of technology and data to empower and engage their clients will bear the fruit.

“In other words, whoever is creating the best consumer experience and value without compromising risk management discipline will win the race,” concluded Bothma.

Writer’s Thoughts

In this evolving landscape, insurers that create a seamless and valuable customer experience without compromising on risk management will stand out. Success will hinge on adaptability and innovation as the industry embraces technology and responds to changing consumer expectations. Do you agree? Please comment below, interact with us on X at @fanews_online or email me your thoughts.

Comments

Added by GSJ (Santie) Opperman, 02 Jul 2024
Highlite the changing enviroment which we have to embrase.
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