As detailed in the previous chapter, the following persons
were interviewed:
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| Qualitative Interview Findings |
Interview Questions and Interviewees’ Replies
- How do you think Fintech/InsurTech (technology) has affected the insurance industry so far?
All the interviewees agreed that technology has affected
operations in the insurance industry, but the impact on sales distribution has
been limited. Others used the words ‘minimal’, ‘status quo’, ‘unchanged’, etc.
Person C said that the use of technology in insurance is more prevalent in
‘backroom’ operations such as automation of routine processes and using chatbots
on simpler claims and customer service requests; this was echoed by Person G.
Persons D, R, G and J agreed that technology has aided the sales process by
making it faster and more efficient. Person G elaborated that at a Million
Dollar Round Table (MDRT- www.mrdt.org) meeting a few years ago; the talk was
of technology replacing human insurance agents. However, the rhetoric has
changed to one of technology making agents more productive.
A cautious tone was sounded by Person R that technology will
continue to evolve and may cause consumers who are more tech-savvy to ‘DIY- do
it yourself’ by going online to research and potentially bypass the agent when
making an insurance policy purchase. Person P suggested that insurance
companies need to be on their toes and keep abreast of ever-changing
technological developments. Person C also mentioned that his organisation is
constantly trying out the technology to replace slow processes currently
performed by humans.
- How do you think agents/advisers have been affected?
While Persons D and P are of the view that agents have not
been strongly affected, the others were more effusive about the need to keep up
with technology trends. Persons P and R warned that the trend of buying online
will only go up; Persons J, G and C stressed that agents must adapt to this
‘transitional’ phase where customers are trying out online experiences. Person
R also highlighted that some customers are well-read; they researched online
before meeting the agent for a discussion.
- What does this mean for customers?
According to Person C, the buying process has been
simplified and insurance made more accessible and easier to understand.
Customers of Person J have even started trying out a few insurance mobile apps
(applications) and researched online before meeting, whereas Persons E and R
believed that with greater transparency, the insurers will be forced to lower
premiums. Both Persons D and G agreed with the above but feel that there is
information overload and in most cases, a trained human professional is still
needed to ‘cut the clutter’ and look at what’s relevant to the customer’s
situation.
- What do you think of Direct Purchase Insurance; directive by MAS (Monetary Authority of Singapore) – insurers have to offer selected policies online/direct to the public without advice?
All of the interviewees agreed the results have not been
forthcoming as hoped by the authorities. An average of about 200 policies is
sold per quarter; a drop in the ocean compared to the overall sold in
Singapore. The experts do differ in their opinions of the intention behind the
move; Person C thought the MAS is forcing insurers to keep up with the times,
while J felt that MAS thinks perceived high premiums are a deterrent, hence
lower premiums will spur higher insurance take up. Person D suspected that it
was a political move but Person R disagreed and felt that the intention of the
MAS was noble in wanting to reduce distribution costs. However, R added that
despite the slight reduction in premium and availability of information, people
still hesitated as they may not know what they need and were afraid to buy an
unsuitable plan. In Person G’s opinion, Direct Purchase Insurance was mostly
used as a portal for consumers, agents and insurers to find out about each
other’s plans and rates.
- Why do you think the take-up rate of Direct Insurance is what it is today? What will happen if a bigger discount was offered?
The general consensus was that it may spur a few more to
venture into online insurance purchases but again, the numbers will be
insignificant. Various theories were offered: Persons D and R felt that the
average consumer did not have sufficient knowledge, but more importantly, the
Singaporean consumer must still be sold on insurance and will not take the
initiative to buy. Interviewees C and J agreed and added that insurance is
usually not high on the list of priorities of the average consumer’s mind. G
offered another theory: there is so much information online and one will find
totally opposite reviews of each plan that the public is confounded. For the
online purchase to gain traction, Persons P and J suggested that the publicity
and marketing efforts need to be ramped up as few were aware of the
availability.
- Why do you think people still choose to buy direct / from an agent?
Online: People who want convenience (Persons E and C).
People who are price sensitive (Persons G, P, E, D). People who are wary of the
agent’s underlying motivation (Persons D, C). Agent: People who value
relationships, trust and professional advice and holistic planning (All
interviewees). Person J offered that it will be people who have limited time
and would rather pay someone to help them than DIY.
- Who do you think is more likely to buy direct without advice?
Millennials (Persons D, E, P) were more likely to do this as
they were born into the internet era and more comfortable buying nearly
everything they need online. Financially-savvy individuals who know exactly
what they want was suggested by Persons P and J. Interestingly, the total
opposite was offered as a theory by Person R who thought it may be people who
don’t know what they don’t know!
- How do you see the insurance industry evolving?
A high-tech but still hi-touch relationship was the vision
of Person G. Agents meeting clients using an online meeting platform such as
‘Facetime’ or ‘Skype’ to discuss their needs. Policies may be signed remotely
without requiring a face-to-face meeting. Person J also envisaged a
technology-driven experience for the client onboarding process.
Persons D and P said that the insurance industry will have
to become more transparent as information becomes freely available. The future
agent will be someone who can put this information together and make sense of
it. A warning was raised by both Persons R and D: Agents who do not keep up
with the times nor add valuable advice will not be able to survive in this new
evolved industry. Those that remain, however, will become more productive and
credible (Persons E and D).
- What has your organisation done to keep in touch/ahead of technology?
A few of the interviewees’ organisations seemed to be on top
of things. Person C’s company has had in place a ‘Strategy and Transformation’
task force since 2015. This team reported directly to the Board of Directors
and was responsible for using available technology to make things simpler and
challenge the status quo. A similar action was being undertaken at the office
of Person R. The company has invested in FinTech and a special department was
in charge of finding what’s out there to try to take advantage of it.
Artificial Intelligence (AI) prospecting was on the cards of the companies that
Persons E and G work at. Algorithms are being deployed to crunch the big
database of their clients to predict which customers are likely to buy and what
plans they would be keen on.
- Does the agent/adviser still have a role to play? If so, what will it be?
All the expert interviewees were unanimous in agreeing that
the agent is here to stay. The agent of the future must provide holistic advice
and always have the client’s interest in mind (Person E). Person C concurred
and added that the agent will provide the human touch required to manage
emotions and other tasks that still cannot be automated. The hi-touch and
hi-tech agent will harness technology to have relevant information available at
the touch of a fingertip (Person P), use technology to process mundane
processes (Person C) to complement his/her ability (Person D) when engaging
with the client. Besides knowing how to do the above, the agent needs to be
able to advise on a wider range of subjects such as trusts, investments,
medical and legal issues (Person J) that are relevant to the client. Person G
called the agent of the future an A.I. – adviser and influencer whereas in
Person R’s view, the agent is still needed to cut away the internet chatter and
noise and to encourage the client to make a decision.
- What can agents/advisers do now to stay relevant?
‘Education’, ‘Attitude’ and ‘Relationship’ were the refrains
heard from all the expert interviewees. Agents will be expected to know matters
beyond their traditional scope of advice as outlined in replies to Q10. Agents
must read widely and strive to educate themselves and to acquire a multitude of
skills. A mindset change is also critical – agents must embrace new technology
and use them to their own advantage to become more indispensable and
productive. Finally, the interviewees advised agents to still continue to do
what they do best at; relationship building by managing client’s feelings and
deepening the bond.
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