Intermediaries retain their edge on robo-colleagues
For intermediaries, technology is often positioned more as competitor than ‘colleague’, and some intermediaries even fear the Fourth Industrial Revolution (4IR) may render them redundant. However, while there’s value in having an influx of information available, people still need a knowledgeable ‘guide’ to provide a holistic plan. Hence, a hybrid model is something intermediaries can explore going forward. Ultimately, being future-fit means marrying the best of tech with the best of human traits.
Andrew Coutts, Head of Intermediated Business at Santam, says intermediaries need to understand their clients’ expectations are changing. Digitally connected clients want to interact differently, through an omni-channel approach that traverses multiple devises. They want fast, effective solutions that are as effortless as they are personalised.
COVID-19 has forced many industries to integrate digital practices and this could prove to be the best training ground to help evolve the intermediary industry.
Going forward, many intermediaries will need to place more emphasis on adopting best-practice technologies that can automate the mundane so more time can go toward developing a stronger value proposition. Importantly, intermediaries need to appreciate the unique value they bring to the table – their ‘human’ expertise that robo-colleagues cannot emulate.
Coutts says, “Technology is limited in lots of ways. It can only react to preconceived scenarios which limits its ability to manage and respond to complexity. Technological solutions are also only as good as the quality of the inputs – that means that an ill-informed user will get a poor outcome. This is also where an intermediary can play a major role in ensuring the right questions are asked and inputs are given.”
The other big advantage intermediaries bring to the table? Emotion. Humans value engagement and interaction with other humans, even if this is facilitated through technology. Technology cannot provide anything other than a preprogrammed response. Intermediaries have a massive opportunity to amplify empathy, reassurance and engagement through face-to-face interaction and through the various communication platforms technology facilitates.
Going forward, Coutts foresees the cost of compliance driving a reduction in the number of product providers supported per intermediary and the availability of digital tools driving a decrease in administration costs through client self-service enablement and improved administration efficiency. Additionally, he believes the use of low-cost digital platforms will enable intermediaries to exponentially reach and access new markets. He also predicts the growth of standalone risk management offerings that facilitate risk transfer. To be at the forefront of these changes, he advises that brokers:
- Commit to new levels of professionalism, and technical risk- and insurance knowledge;
- Adopt technologies to provide reach, access new markets, drive lead sourcing, and integrate product and service solutions;
- Use technology to increase efficiencies;
- Empower clients to self-service to reduce administration costs and provide 24-hour engagement;
- Use technology to really understand the client and become even more client-centric;
- Employ tech to manage and use data, drive cross- and upsell offerings, anticipate and mitigate risk, and provide added value;
- Employ technology to ensure compliance through better structures and record-keeping around client engagements, plus good quality management information, and structures for sale and renewal management.
Coutts concludes that intermediaries are fundamental to the growth of the insurance industry, “Risk is increasing, and it is simply not sustainable to continuously increase policy premiums in response. New solutions need to prevent or mitigate risk; not simply transfer it through an insurance policy. The prevention of risk requires proactive risk management and advice solutions, which is where the broker plays an invaluable role and has the inherent advantage. Going forward, the future is bright for intermediaries who protect their relevance and longevity by ensuring they’re taking active measures to be future-fit.”