Renown policy analyst Ramathan Ggoobi has advised insurance companies to embrace new technologies in order to meet the changing customer expectations.
The Makerere University Business School (MUBS) senior lecturer made the revelation while delivering his keynote address during the Insurance Brokers Association of Uganda (IBAU) 3rd Annual Conference on Thursday.
According to Mr Ggoobi if any new or already existing companies of insurance are to compete in such time, digital adaptability must be the top priority to them. He noted that due to Covid-19, 2020 was a year of disruption and transition for enterprises so 2021 and beyond are going to be a period of continued evolution where digitalization will be the only way.
Mr. Ggoobi’s caution follows the new changes of business transactions that have been caused by the outbreak of the covid-19 pandemic where people’s priority changed and the newly adopted changes are engineered by the new technologies that have come on board. Such techs include Financial Technology (Fintech) and Insurance Technology (InsurTechs).
“Consumers have shifted their priorities and now much emphasis is on things like on health and safety. Remote work is officially the new normal and this can also come true when digital adaptability is embraced,” the researcher said.
Mr Ggoobi added that as companies embrace digitalization, they must take advantage of hybrid clouds (individual and public clouds) to understand their customers and improve their decision-making.
“Invest in systems that can efficiently and effectively process, analyze, and store the data streaming into your company. InsurTechs and incumbents’ partnerships: established insurers should leverage customer relationships to create opportunities for new income streams.” Adding; “Insurers to go digital; usage-based car insurance; home insurance with cyber services (the more time we spend home, the more important such services become an extension of a home insurance); reciprocity to solve privacy issues; data protection.”
He also asked companies in Health insurance to restructure from only covering risk when there is damage, to rendering preventive services through innovations among tech providers to link insurers to healthy ecosystems.
“Reflect on what you’re offering to customers and how you operate as a business. We are moving towards a world where people are going to be more important than just making more money. You need to rethink operations, environmental impact, and how your products are being used.”
On his part, IBAU chairman Solomon Rubondo assured Insurance companies that brokers pledge to share not just information but quality knowledge to inform opinion on appropriate Insurance policies required by customers.
“The penetration of insurance in Uganda is not so good but brokers have helped a lot to interpret the purposes of insurance to the public and we have informed individuals, companies or business owners that there is a policy that suits their nature of risks,” Mr Rubondo asserted.
Musa Lukwago, a principal economist from the ministry of finance also added that as a way of supporting insurance companies, the ministry is revising the third-party rates to see that people are compensated the right amount in case of accidents.
“We are working on projects to better the Insurance sector. The government and Ministry of Finance shall continue supporting the insurance sector.”
On the other hand, Doris Mwesigire Mutabazi who was one of the panellists, asked Insurance companies to also create incentives to clients who don’t make claims for a certain time. “Tariffs are still high. Isn’t it time to think of incentives for people who don’t make insurance claims in the given period? For instance, no claim on comprehensive insurance for a year, can there be an incentive in terms of cashback?”
She however, cautioned that products and procedures should be made simple since consumers need to understand that when they buy insurance they have bought security for themselves and their businesses.
As a way of embracing the new tech in the insurance sector, Dr. Ben Kajwang the Chief Executive Officer of the College of Insurance in Nairobi said, “We are looking at a new work environment that is complex and challenging. We need to change our curriculum by going forward to capture the new insurance norms. Technology is key.”
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