John Kamau, Corporate Accounts Manager Africa for SSP spoke to COVER about guiding clients through a challenging year.
Tony: Technology has become the main enabler across the insurance value chain, especially so for the many fantastic innovations coming out of Africa. Can you give us a bit of an overview of your experience as a software provider in Kenya and the broader Africa? Over the past 12 months, what has it been like, and what has been the stuff that has surfaced for you.
John: I’m sure everyone has been speaking about 2020 as a crazy year. I mean, we went through a period for which we had no previous experience. In nearly 30 years of being in the insurance industry, business participation and everything else, it’s the first time I’ve seen anything like this. So I think, as a software provider in Kenya – and obviously serving the region during the pandemic -it was quite interesting.
When the pandemic started and lockdowns in several countries were put in place, the mainly paper based insurance industry – reliant on person to person interactions – was faced with this new world that they did not know how to manage.
Given the circumstances, there was bound to be some turmoil in how companies were going to react, and you probably are aware about all sorts of exclusions that are being added onto policies, especially on the health, property and travel insurance side.
We closed our offices in February in Kenya, while most other insurance companies started closing their offices in March, getting staff to work remotely.
I think, for us, the period before our clients fully closed and the fact that we closed early, allowed us to help customers in assessing their state of readiness for staff working remotely. It was reassuring that quite a number of them quickly built up structures that allowed them to work remotely, obviously backed up by the technology they had. From a software vendor point of view it was quite interesting, because now that we could not travel, we were forced to implement projects or provide user training and elements virtually.
We’ve had considerable success in this approach, where we’ve delivered some projects from ground up to live. Being totally virtual, they’ve taken slightly longer, mainly because, when you’re doing training remotely, it ends up as several short sessions over a few days, rather than one full day.
However, we’re pleased to say this new way of working hasn’t impacted the effectiveness of our delivery. What I’ve noticed is that the insurers who have robust systems and could allow their staff to log in remotely, were quite significantly more successful. However, it obviously opened up a lot of challenges to the entire business environment.
Tony: What were the burning issues that companies sought your help for?
John: Insurance has never been a no-contact sport. There was always somebody sitting in front of a customer service desk, paper has always moved from a broker to the underwriter and phone calls or office visits have historically been the norm. COVID immediately turned the whole industry into a no-contact sport.
So some of the burning issues that we’ve had to deal with, include insurance companies now looking at new distribution channels and needing to be able to bring in business on their platforms through elements such as broker portals and customer self-service portals.
We also had to deal with integrations into payment platforms. In Kenya, for example, with a significant reduction in cash handling or cash transactions to minimize person to person contact, Things like the M Pesa platform became crucial, with government helping to bring down the fees (including bank fees) so thatwe could have a cashless economy. Those are some of the issues we picked up around integrations, and alsoexpansion of new distribution channels. Of course, in getting to these new customer self-service portals or the broker portals, the one challenge I noticed was that, because of the traditional way of work where everything was paper based, existing customer journey processes were very long.
Now, the new channels require much shorter customer journeys to fulfillment. This meant that many companies had to reassess their products, and look at reducing the number of questions asked to a customer before the transaction can be fulfilled. Or indeed check whether it was possible to integrate with third party platforms to pull in some of the data required to minimize the amount of data entry needed to complete the action.
One of the things we are undertaking in Kenya, is integration to the Motor Transport Authority, where the Vehicle Registration Bureau has most disclosed details. So, if I input the vehicle registration number, it will be able to provide all the vehicle details that I would require. Ordinarily, you’d have to capture this manually.
Tony: Everybody is talking about digitization and I see insurers in Africa being serious about it. How do you see this?
John: Digitization is still a very much in use buzzword, and you’ll see many insurers now have Digital Officers, engaged to take advantage of this within their own businesses. So there is a will, intention, a direction or shift towards digitizing insurance.
However, the common response I often receive is one where most still haven’t reached a point where they can conceptualize products that to sell on a digital platform. And not just that, even when you create a product, how do you price it?
Unfortunately, the industry as I see it hasn’t yet truly realized the value of data, so they may not have the foundations of how to conceptualize a product and price it accordingly in this new digitized space.
The other challenge is within commercial lines, where most of the business seems to be broker driven. The challenge therefore is that the insurer often has difficulty coming to a point where they are in a position to go ahead with releasing a new product.
With this in mind, the challenge that I keep pushing to underwriters is that, if you come up with a product which you’ve priced and is attractive to the consumer, it will be easier for the broker to sell. If you have a product that consumers want to buy, then you have control of your digitization process, your pricing and the product conceptualization.