The importance of integrated insurance solutions in enabling security for customers

By Indranil Bandyopadhyay: Chief Information Technology; Nedbank Insurance

As the global preference for digital consumption increases around the world, it’s imperative that organisations claiming to prioritise customer centricity ensure that their business models evolve to match the digital expectations of their customers. In many ways, financial services organisations – and especially banks – have been leading the charge in recent years in terms of driving digital access to services and solutions, and the Covid-19 pandemic and lockdown response by many governments around the world significantly accelerated progress on this digital banking journey.

In South Africa, the one area of financial services that still has some catching up to do in terms of fully harnessing the power of digitisation to deliver compelling customer experiences is insurance. Given the historically segmented nature of insurance options, with different providers typically choosing to specialise in certain, specific types of insurance, this slight lag by the industry in achieving its full digital potential is understandable. However, that doesn’t necessarily mean that it is acceptable – and insurers have a responsibility to their customers to quickly ‘catch up’ to the rest of the financial services industry and delivering compelling, integrated, cost-effective, solutions that enable customers to meet all their insurance needs seamlessly and effortlessly, preferably in one place.

Along the way, in the insurance business I’ve learned several very valuable lessons about what it takes to successfully deliver the holistic and convenient digital insurance experience that South Africans expect today.

1. Don’t sell products.
The days of one-size-fits-all insurance products, where the only things that differ from customer to customer are the name on the policy and the cover amount, are long gone. Today’s consumers, and businesses, demand and deserve cover that is as unique as they are, and that is custom-created to meet their precise needs. This is true of every type of insurance cover, whether short- or long-term, and irrespective of the similarities that may exists within given demographic groupings.

Lumping your customers into categories based on income, gender, age, address, etc, may still be required for the development of marketing strategies, but there is simply no place for a mass mindset when creating a cover solution for an individual or business; that has to be needs-based and flexible enough to adapt to the risk implications of an increasingly dynamic world.

2. Make insurance as pain-free as possible for your customers.
While it’s possible that individual insurance providers will one day reach a point where digitisation allows them to be all things to all their customers, we are not yet at that point on the global insurance landscape. However, just because an insurer doesn’t specialise in a particular insurance solution, that doesn’t mean it should not make it quick and easy for its customer to acquire it.

In our experience at Nedbank Insurance, the best way to do that is by building an open insurance ecosystem using our industry leading API (application programming interface) structures, and then leveraging these ecosystems to deliver a full range of smart and seamless insurance solutions. APIs have already helped to revolutionise the transactional banking industry by creating an open, highly connected transactional landscape where data is shared securely for the ultimate benefit of the customer.

3. Don’t do digital half-baked.
The digitisation of insurance solutions has the potential to deliver massive benefits and compelling cost savings for consumers. But that’s only going to be the case if insurers go ‘all in’ with their digitisation strategies. Ask anyone who has been drawn into a purchase transaction by the promise of a smooth and easy digital process, only to discover that it’s only partly digitised, and they’ll tell you that there’s nothing quite as frustrating as mid-tech. platforms must ensure that it isn’t just the sales component that’s digital, but that every step of the insurance process is optimised through technology. The focus on modernising the back-end systems and automating business processes using AI can allow us to achieve true customer centricity by attending to clients’ needs quickly and in a consistent manner.

It’s no secret that insurance has long been deemed something of a grudge purchase by most people and businesses. The heightened health and economic risk awareness created by Covid-19 has gone some way towards changing this perception as people have come to realise the value of reliable insurance cover from a trusted provider. However, it is now up to the insurance industry in South Africa to capitalise on this more positive sentiment and drive home a permanent change in the insurance culture. Arguably the most effective way of doing that is by creating end-to-end insurance experiences that are simpler, more convenient and add maximum value and security to people’s lives. And getting the digitisation of our industry right is undoubtedly the way to achieve that.