IoT and the role it plays in insurance

By the end of this year, forecasts anticipated that there will be more than 14 billion Internet of Things (IoT) devices in use with that number expected to reach 25 billion by 2021. Furthermore, the global market for IoT is projected to grow significantly between 2018 and 2026 with the banking and financial services industry holding the bulk of the market share. Nelson Camara, go to market executive at SilverBridge Holdings, discusses how this growth can benefit insurers.

Thanks to its effectiveness in collecting data at scale to deliver greater insights, some insurers are already embracing IoT to better predict and evaluate risk, expedite claims processing, improve sales, and gain a more comprehensive view of their customers. Of course, the temptation to rush in and push IoT as quickly as possible is there but insurers should carefully examine what their strategic goals are and how data can be used to help achieve this.

“As is the case with any new technology concept, a business case must be developed first, tested, and piloted before embarking on a new digital strategy. Even though the pressure to transform is significant when looking at the growth of insurtechs, incumbents must maintain their focus and investigate an area where they can extract the maximum benefit from IoT.”

Embracing change

Insurers have been tasked with embracing disruption in recent years especially when it comes to customer and partner relationships. IoT can be considered a vital ally in this regard as everything from wearables to sensors in homes and telemetry devices in vehicles can gather vital data especially as it relates to risk assessment.

“This is essential to delivering customer value. Already, some insurers are using telemetry data to identify driving behaviour and gamify the experience (drivers can rate themselves against others nationwide). In turn, it transforms the relationship with the customer. By optimising premiums on an individual level, the insurer not only delivers a better experience for users but strengthens a relationship that may become very fickle when it comes to loyalty.”

These IoT-connected devices have helped some insurance companies significantly lower their premiums. According to an international report, most insurers believe that connected devices and more data will prevent greater losses, which could decrease the number of claims and lower insurance prices for customers who have reduced risks.

Of course, in a world driven by data, care must be taken to remain cognisant of the governance requirements especially as it relates to personal information. Therefore, an effective data management strategy is important that keeps historical data available while tapping into the influx of new data points through IoT-enabled devices.

IoT is providing insurers with a significant amount of data that can be used to asses risk and tailor pricing in more innovative ways. And by developing new personalised risk protection services, they will improve the customer experience as well as the value to be delivered.”

About SilverBridge

SilverBridge has over 24 years’ experience as a leading provider of insurance software solutions in the African financial services industry. Our experience includes working with over 60 customers across 16 African countries.. SilverBridge’s digital insurance suite allows financial services companies the opportunity to respond quickly to changing markets. With customers throughout Africa, SilverBridge has the knowledge, experience, and technology capabilities to help its clients do better business.

Exergy helps insurers overcome the complexities surrounding Debicheck

First launched in 2017, the Debicheck authenticated collections process has been designed to combat debit order abuse – from companies that are processing invalid debit orders to consumers avoiding paying them by unfairly disputing these with their banks. Yet, it has been cumbersome and expensive to implement from an insurer perspective. This has resulted in a slow uptake and market cynicism that this is an effective system.

From a practical perspective, debit order mandates are electronically confirmed by end users with their banks on a once-off basis to ensure no amounts are deducted from their accounts without their approval.

“The lack of widespread adoption shows that the resources and systems required to effectively implement Debicheck are not seen as worthwhile. However, SilverBridge has made significant enhancements to Exergy that help make this a smoother process. Our clients can rest assured that the administrative aspects of Debicheck are taken care of, leaving them to focus on business processes such as training staff,” says Annalie Terblanché, product manager at SilverBridge.

Exergy automates the Debicheck mandate process for insurers who have already implemented it.

“Some of the work we have done for a Johannesburg-based client reflects our commitment to assisting companies on the difficult journey when it comes to Debicheck. Exergy will always remain relevant as we ensure it adapts to ongoing changes in compliance demands. Even though Debicheck only signifies a small proportion of deductions, having this support is essential for long-term growth,” concludes Terblanché.

About SilverBridge

SilverBridge has over 24 years’ of experience as a leading provider of insurance software solutions in the African financial services industry. Our footprint extends to 14 African countries. SilverBridge’s digital insurance suite allows financial services companies the opportunity to respond quickly to changing markets. With customers throughout Africa, SilverBridge has the knowledge, experience, and technology capabilities to help its clients do better business.

Hollard Partner Solutions joins forces with SilverBridge for its core insurance system Exergy

SilverBridge has entered into a contract with The Hollard Life Company to implement the Exergy cloud-based policy administration system for the Hollard Partner Solutions business, a division of the well-known South African insurer.

“Our organisation has worked with the Hollard group for a number of years now and has been part of assisting the organisation with its expansion into Africa. This has been an operational success and enabled significant improvements and now the Hollard Partner Solutions business has engaged us to do the same,” says Lee Kuyper, COO at SilverBridge Holdings.

Fundamental to the decision to move has been the advantages the cloud can provide insurers in the digital landscape. This includes an effective environment to test and deploy new technologies, enabling insurers to innovative quicker in a highly competitive environment.

“Like most insurers, Hollard wants to position its business for a digital world. Our experience in doing this for other customers and our close relationship with global technology leader Microsoft has given us a further edge to any competitors in the market. But for us, it is not just about finding the perfect technology fit, but providing value to our customers. They understand the technology and how to effectively adapt it to suit the unique requirements of our customers, and how to engage with the people at our clients in a way which builds trust and confidence that we will be there for them whenever they need us,” says Kuyper.

Using Exergy on the Microsoft Azure cloud will help Hollard Partner Solutions modernise its core insurance system. It will give the organisation the ability to not only scale according to customer requirements but embrace emerging technologies to deliver significant value to end customers.

“The project will be done through a phased approach to ensure all policies are effectively migrated and the Hollard team is equipped to use the Exergy platform optimally. Even though any insurance system migration is a complicated process, the established SilverBridge relationship and track record with Hollard does make it much smoother. Change management is vital for a project of such magnitude, and Hollard has committed a number of resources to assist in the smooth transition. Our experienced consultants also provide Hollard with the comfort that our people will be with them every step of the way. We have more than two decades experience in the insurance industry and our people are our most valuable asset to help leverage the value to be had from technology investments in a digitally-led business environment,” concludes Kuyper.

“Hollard Partner Solutions are excited about the opportunities that lie ahead with Silverbridge because our IT philosophies are closely aligned. As we focus on digital transformation, the Exergy platform also plays a pivotal role in enhancing our online channels and processing capabilities,” says Duran Chetty, COO at Hollard Partner Solutions.

About SilverBridge

SilverBridge has over 24 years’ of experience as a leading provider of insurance software solutions in the African financial services industry. Our footprint extends to 14 African countries. SilverBridge’s digital insurance suite allows financial services companies the opportunity to respond quickly to changing markets. With customers throughout Africa, SilverBridge has the knowledge, experience, and technology capabilities to help its clients do better business.

Evolution of insurance distribution channels

Thanks to the increased technological sophistication of end-users, insurers must find more innovative ways to engage with their customers. Additionally, the growth of insurtechs has created a new market dynamic where incumbents must adapt or lose their relevance. According to Annalie Terblanché, product manager at SilverBridge, this has resulted in the diversification of insurance distribution channels.

“Fortunately, insurers do not have to reinvent the wheel. They can capitalise on the greatest asset at their disposal – the large amounts of historical data they have access to. While insurtechs are seen to be agile and more adaptive to change, the incumbents can draw invaluable insights from customer data to identify channels with the highest likelihood for success,” she says.

Already, some of the fastest-growing channels worldwide are affinity and retail partners as well as a burgeoning bancassurance (the selling of insurance products by banking institutions) segment. Furthermore, mobile and Web have become fundamental in reaching insurance customers.

“These are all areas where insurers can leverage their data analytical capabilities and carefully target existing (and new) customers using the channels most relevant to them. Of course, mobile and Web must be the foundation on which many of these engagements are built. But by starting to think outside the box, an insurer will diversify the number of channels it uses and how it uses them to drive the business bottom-line.”

Tradition no longer

Fundamentally, a distribution channel allows customers to access and purchase products in the most efficient way possible for the business. There are direct (i.e. call centres and the Web site) and indirect (a broker) channels available. However, as consumer needs change, there will be an increasingly reliance on going direct and cutting out the middle-man completely.

“The real-time nature of people’s lives mean they want immediate responses to queries, want their policies to suit their unique requirements, and want to be more in control of their policies than was previously possible. This can only happen if the insurer is willing to take customer data and analyse it for better insights. It must also be able to harness those learnings and offer people solutions that fit into the channels they are most comfortable with.”

Potentially, this could see the development of more niche products that cover specific risks for short periods of time. In many respects, this talks to the lack of brand loyalty many companies face today. It is all about capitalising on short-term gains while relying on an existing customer base for more long-term potential.

But tying all these channels (and distribution models) together is a reliance on digital technologies. An insurer simply cannot remain focused on what has worked for it before. It must be able to adapt to the fast-moving technology-led environment and reach customers more effectively.

“This is why insurtechs are finding such popularity amongst consumers. It is time for the incumbents to do this as well and build momentum with the Fourth Industrial Revolution around the corner,” she concludes.

About SilverBridge

SilverBridge has over 23 years’ experience as a leading provider of insurance software solutions in the African financial services industry. Our footprint extends to 14 African countries. SilverBridge’s digital insurance suite allows financial services companies the opportunity to respond quickly to changing markets. With customers throughout Africa, SilverBridge has the knowledge, experience, and technology capabilities to help its clients do better business.