The Sunday Mail
The coronavirus pandemic has disrupted traditional ways of doing business, but the silver lining is that new approaches can and should be developed.
As Winston Churchill famously said after World War II, “Never let a good crisis go to waste”.
Zimbabwe’s insurers have lagged behind with regards to innovating their products and offerings.
A careful look at local sectorial developments during the first few months of Covid-19 points to a sector that is literally “wasting a crisis”.
The pandemic has necessitated social distancing, but that doesn’t mean businesses should distance themselves from their customers.
Quite on the contrary, businesses should show even greater engagement, especially through digital platforms.
During the Covid-19 period, some motor vehicle insurance customers have benefited from GeneInsure’s Automated Licensing Machine.
However, that is a 2018 development and has certain limitations during this pandemic, not least that it is not widely available.
Local insurers’ digital solutions have not improved over the past few months, and in some cases may have regressed as these firms’ customer service quality is compromised by the necessary work-at-home routines.
A number of companies have long set up insurance technology (insurtech) offerings, but some of these have limitations that are being exposed by Covid-19.
According to some customers, it is stressful to try and deal with insurance providers over the phone or on digital platforms.
“I was forced to visit one of these insurance firms some weeks ago, when their Chatbot couldn’t go further than some limited responses,” said Melody Mukwesha from Harare.
“It is frustrating because I was merely enquiring about one of their products, which they should have simple answers to.”
Clearly, these companies are failing with regards to providing the key principles that underpin successful relationships with their customers, namely: resolution, expectations, time and effort, personalisation and empathy. More than just ensuring effective online systems, revamping present insurtech system can help insurers overcome their traditional long and complex contracts, which are distributed through costly networks of agents and brokers that only reach the urban elite.
Today a significant segment of rural populations have access to digital platforms; therefore, improving the efficacy of these systems can boost companies’ market reach and Zimbabwe’s insurance penetration.
However, “not wasting a crisis” — with respect to insurance companies — should go beyond how well these firms are performing in the information and knowledge society.
Global advisory firm KPMG says it should extend to their product offerings.
“Insurance is fundamentally about protection. And while it cannot protect students from finishing their studies from home, without a proper graduation, insurance can protect against many of the financial impacts caused by the pandemic: travel insurance, health insurance, business interruption insurance, workers’ compensation (WC), paid sick leave, life insurance, hospital indemnity, and disability, to name a few, are all types of policies that may provide relevant protection,” said KPMG in a recent paper.
“In some cases, to have adequate protection, certain terms needed to be revised; for example, the use of personal cars for commercial delivery, use of personal residences for WFH (work from home), or location of work for WC.
“Given the overall impacts to the economy, many carriers have also adjusted the payment terms around timing of payment, late fees and cancellation for non-payment even partial return of premium for reduced use (for example, auto premiums).”
The immense socio-economic disruptions that have been caused by Covid-19 globally have served to highlight significant gaps in insurance covers.
The nature of risks emerging from the pandemic have served to highlight new opportunities.