4th Asian Microinsurance Completed in Vietnam
The 4th Asian Microinsurance Conference was held in Vietnam 22nd/23rd of July and resulted in some solid recommendations for microinsurance moving forward and very strong networking presence of over 100 delegates from 20 countries. The lead sponsor Unirisx Asia Pacific Chairman, David Piesse, who founded the conference with AIR four years ago said “We have come a long way since the first gathering in Manila four years ago. The industry is learning as it moves forward in this sector and we look forward to the 5th conference in Cambodia in 2011″.
The main themes for the conference were education of insurance (financial literacy) and claims, both of equal importance. Without education there is misunderstandings of claims situations and without prompt payment of claims there is no trust – a key element in microinsurance at village level. These recurring themes of the conference were embellished by games, comic strips, viral video clips and even a full length Bollywood movie based on microinsurance. Within the topics of education and claims, innovation was the key word.
Country insurance regulators who have not yet put together microinsurance programs were urged to do so and when doing so asked to think out of the box. It was also essential for reinsurers to get on board for microinsurance capacity cover and in return should expect strong claims control. The need to protect against natural disasters on the increase was paramount the conference speakers outlined.
Technology was identified as the business enabler to make microinsurance cost effective by reducing the cost of transaction. Mobile phone and voice technology along with a pay as you go insurance platform were identified as the key game changers for this sector and reaching customers through the last mile.
The Chairman of the conference, David Piesse of Unirisx, introduced the concept of embedded intangibles for the microinsurance sector where value can be added to microinsurance projects early on and get that value recognised on the balance sheet.
Innovative distribution was discussed and debates were held on broker models versus the community model and distribution beyond the traditional MFI agent model. The conference touched on the principles and advantages of microtakaful for the Muslim affinity groups globally. What was key is that the claims settlement process is done locally and by people who live in the community, otherwise trust is lost.
The conference showed the various state of the nation for the countries in Asia. India remained the poster child for most delegates due to the early regulation in this area. Philippines announced their new microinsurance regulation and the fast progress being made for Filipinos in getting financial inclusion. The host country, Vietnam, gave a glimpse of the future regulation there and delegates learned of the substantial work being done by the Women’s Union of Vietnam.
Delegates look forward as the microinsurance flag is passed to Cambodia for 2011.
Unirisx is Key Sponsor of 4th Asian Conference on Microinsurance
Unirisx in conjunction with the Asia Insurance Review is pleased to be lead sponsor of the 4th Asian Microinsurance Summit in Vietnam’s Ho Chi Minh City on July 22-23rd July. There is an expected audience of over 120 people from 22 countries.
David Piesse, the Chairman of Unirisx Asia Pacific, who founded this conference four years ago with AIR, says that in the four years since we have been doing this conference we have seen huge changes in commercial commitment, technology changes, new processes, products and many new entrants into the sector. These changes will be discussed at the two day conference where the theme is about financial literacy and education of microinsurance recipients in emerging markets.
Among the great questions of our time in the insurance industry are -
- global warming and natural disaster mitigation
- alleviation of the poor by microfinance and microinsurance
- leverage innovative use of technology such as the INTERNET and mobile phones
- reduction of moral hazard in insurance to all more capacity and cover to happen
- strive for healthcare cover for all and immediate claims payments
- regulation of insurance across borders
All of these topics will be addressed with practical case studies at this key conference for Asia.
Summer is here!
It’s summer here in North America and vacation season is in full swing. In fact, even around here, people who are normally tied to their email are starting to disappear for a day here and there to seek out some natural surroundings or merely a bit of peace and quiet, escaping from the usual business pace. That said, we’re in insurance and as anyone who’s worked in this business knows, there never really is a “time off”.
Vacation season also brings the need for different coverages (motorcycle insurance, marine watercraft, etc.), additional claims activity due to increased traffic and people on the roads and increased operational activity as businesses prepare new product offerings for the fall.
You see, here at Unirisx, we believe in recharging the batteries now and then. It’s important to take time out to rest and refresh yourself to be ready for the competitive fray. But, it’s equally important to know that your business will be okay without you for a few days – with solid, stable systems that support you as you grow. That’s our goal – letting you focus on the business and occasionally on fun – knowing all the while that you’ll have what you need to be successful.
So go ahead and enjoy your vacation. If you’re a Unirisx customer, you can rest easy knowing we’ve got you covered with systems that are available to some of the highest standards in the industry and technical staff working around the clock to make sure they keep running like they should.
It’s not about reaction, but anticipation
The article below captured my attention. Written about the state of insurance technology in India, it describes many of the same forces of change as other markets, whether the US, Europe or Asia. We all know that the insurance industry is dynamic and fast growing, but it certainly seems to have sped up as of late. The challenge for IT is to keep up with this pace of change, and also to anticipate where the growth will take us. At UNIRISX, we take this challenge to heart, and have designed our systems to be integrated, scalable, flexible, configurable and architecturally robust.
Link to Economic Times Article: http://economictimes.indiatimes.com/articleshow/6025954.cms
Bancassurance- The Price of Persistence is Partnership!
My travels this week took me back to the Middle East where I happily traded a UK Bank Holiday for a seat at a Bancassurance conference organised by the Middle East Insurance Review.
I have been involved in bancassurance projects for a dozen years now and have seen active service in UK, Southern Europe and the emerging markets of CEE. I have attended many Bancassurance conferences as a delegate or speaker and gave the keynote address at a conference in Vienna a couple of years ago. On Tuesday, one of the early speakers- Debo Ajayi of Milliman, asked for a show of hands to determine the representation of banks and insurance companies. The result was depressingly familiar: the insurers outnumbered the bankers by a factor of 10:1, re-inforcing a view I used to hold that bancassurance is more attractive to the insurer as a channel than it is to the banker as a revenue stream. Such analysis is superficial though, especially when you consider that in many bancassurance deals today, the banks are taking the lion’s share of the profit. In addition, in recent years the degree of “churn” has increased, most often caused by the banks as they seek to drive up commissions at renewal time.
In short, the bancassurance sector is littered with failure and there is often disappointment on both sides of the deal. The insurer’s goal of Persistence is simply not being realised in many cases, making it a hugely expensive exercise. The banks also are often experiencing disappointment however, even though they have rarely had a greater appetite to earn fee-based income.
While there are usually a number of factors causing such mutual disappointment and each bancassurance case needs to be evaluated on its own merits, I believe one reason is very often at the root of the problem: it is also a reason that rarely gets uncovered in the analysis. I am going to invent a title for it- lets call it the “Sweet Spot Syndrome”. My theory goes like this: banks have large customer bases; insurance products (designed on risk demographics) typically appeal to segments of the market- put the two together and you have a product which might appeal to 5-10% of the banks customers. To parody Mr Micawber, there you have a recipe for unhappiness. Banks are disappointed with lead conversion ratios and the whole relationship with the insurer becomes purely tactical, thus higher churn rates.
As a technologist, the solution is for insurers to offer the banks a range of products which extend the appeal to a greater audience within the banks customer base. A one decimal point rating tweak can make a motor product more appealing to lady drivers; another tweak and it is a product for Over 50s etc etc- in Unirisx we have such technology and could deliver these products in less than an hour! The problem for insurers though is that today, many are severely constrained by legacy technology. One of the presenters at the conference, Saurabh Saran of ADNIC, in a refreshingly candid assessment said that in his opinion insurers were about 5 years behind banks in their use of technology (a subject I will return to in a future blog). So there you have it: insurers are locked into sweet spots and their technology is preventing them from extending their coverage.
Innovative, low cost technology is available today which would unlock the insurer restrictions, allowing them to enter into partnerships with banks based on continuous innovation through rapid product development and launch. A partnership relationship becomes more strategic, enabling a tighter integration with banks systems and processes and so facilitating more sales and Persistency.
I think Mr Micawber would have described it as Happiness.
You know, sometimes it feels like I am holding a wand…
It’s the Business, Stupid
As I’ve noted before, the trade show season for insurance IT is in full swing. That means we are having lots of conversations with customers, new and old alike, on what is going on in the industry. In fact, this week, we had staff at three different conferences in different cities, all focused on different but important topics in our industry.
One thing has struck me as a common theme in all of the conversations I’ve had this week and I suspect my colleagues would agree. The people we are talking to are all looking for solutions to a business problem. They’re not looking for a flashy new IT toy, nor are they looking for a ‘system.’ They are looking for solid, proven solutions to the business challenges. Yes, that ‘solution’ may in fact be a system, but that’s not the main outcome they’re seeking.
In one meeting this week, something striking happened. The customer took a look at my business card and went, ‘wow, I don’t think that I’ve ever seen an IT person with a CPCU before.’ That started me thinking about how many of us here at Unirisx came from the business side of the industry. Sure, we have strong technology people, and we love them because they produce really cool stuff. But in the end, what we’re selling in the market and what we’re implementing for our customers is something different – it’s real, measurable business results. As a former underwriter myself, I could do nothing less and I suspect my colleagues would stand with me on that.
So, to paraphrase a now-distant election campaign, ‘it’s the business, stupid.’ Here at Unirisx, we get that – because we are business people too. A software company that understands your business? Just one more way we’re changing the nature of insurance IT here at Unirisx.
Separating the Wheat from the Chaff
A client recently asked us, when is the right time to move from management reports to a business intelligence system? It’s a good question, and a hard one to answer, as it really depends on many factors that are unique to that particular business and its competitive landscape. In fact, having good access to and understanding their data is one of the key things that keeps insurance execs up at night. Insurance companies are full of data, but good quality data and in particular, meaningful interpretations of that data, are often in very short supply.
It is useful, therefore, to make a distinction between management reports and a business intelligence system. While both are useful in managing data, they serve different purposes and can provide significantly different benefits to an organization.
A business intelligence system is software that aggregates the transactional data typically used for MIS reports, separates the important from the mundane, and transforms it into those important nuggets of information that can be analyzed and acted upon. It also allows you to view the data in new ways, resulting in those ‘aha!’ moments that can truly help you understand how your business is running.
In general, the larger an organization, the more a business intelligence infrastructure is required because many more people are looking at the data for insights into the performance of the business, and to identify opportunities.
Having implemented many of these systems over the years, we know one thing for certain. Any report or business intelligence system is only as good as the underlying data. That’s one reason why we designed UNIRISX to allow us to capture any and all pieces of data that the system touches, and to report on that with a few clicks of the mouse. That’s also why we are actively working on adding an insurance-specific business intelligence (BI) solution into our offering, because we know that understanding your data is key to understanding your business.
Pretty neat, and just one more way that UNIRISX is breaking the mold of insurance IT!
By…Jonathan Kalman
Cloud Computing and ESCROW – luxury or requirement??
Software as a Service (SaaS), a form of cloud computing, is increasingly commonly used especially now in the insurance sector – Unirisx should know, we’ve now almost reached our tenth anniversary in running Unirisx as a Cloud service! However this is also the trend across the whole financial services sector according to NCC Group, the world’s largest software Escrow provider.
Whilst traditionally Unirisx clients have had individual arrangements for Escrow services when required, we are pleased to announce we have now formed a master agreement with NCC group where this process becomes automatic and seamless should clients wish to participate – so should they ??
One of the potential discussion points around the Cloud is the inevitable question – am I putting all my eggs in one basket with the service? – What happens if that breaks…am I just left with scrambled eggs! Escrow of course is one of the answers.
Software Escrow is the placing of the software’s source code with a trusted third party, such as NCC. The supplier and customer agree that the code will be released in identified circumstances, such as the supplier no longer being able to support the product.
So, should clients do so? According to NCC, “Companies need to think about Escrow in the Cloud environment as much as they would for traditional software”. Indeed increasing regulations such as the FSA or Global Audit requirements now mean that this may be a “tick in the box” for clients to meet their corporate Risk mitigation policies. Corporate risk and business continuity are of course things that have moved up the corporate agenda in most organizations especially in today’s market economy.
Ultimately, Escrow is designed to ensure that customers are not left with an unusable service if a company goes bust or fails in its promises to support and update a product. But would it really be useable? To answer that – This is not the only advantage – the usability of the source code is for many people completely irrelevant. In fact for many users of Escrow services its main benefit is not the retrieval of software code but the threat of forcing that retrieval. It is like a sophisticated form of insurance – Believe me – here at Unirisx we want of course to keep our “Crown Jewels” firmly in control and pristine and so being on the end of an Escrow agreement does indeed concentrate the mindset! So it goes without saying that this is not a problem that Unirisx clients will ever have.
Indeed, legislation aside, according to NCC’s Escrow director, Jon Leigh – “It is essential in any business relationship, especially during a recession, for a provider to instill confidence in its customers, and SaaS providers are becoming aware of this,” he said. “If they are unwilling to appease a company which is keen to secure access to a critical application should it become unavailable, it’s probably time for the business to look elsewhere.”
So the bottom line – we’re used to dealing with Insurance, just like our clients – so treat your service in exactly the same way, and get it covered!
Serving the Under-Served
At Unirisx, we believe in making technology available to the business people who need it most, not just the largest and most well-known (although some of those are our customers too!) While most people outside insurance are unaware of its existence, the General Agency (GA) market in the US plays a critical role in distribution of insurance products. In particular, General Agencies have built a tremendous capacity for serving under-served markets and working ‘niches’ where traditional carriers simply don’t play. That said, in many ways the General Agents themselves are under-served too.
Every GA has a need for good quality software platforms to run their business. In fact, most GA’s have the same challenges that carriers do and more – but all too often have been forced to look at buying systems built for carriers and then spend money modifying them to handle their needs. With complexities like supporting multiple carriers, managing the various fees that they must charge, and special reporting, technology is a big challenge and an expensive one too. Since carrier systems have historically been multi-million dollar purchases, many GA’s built their own or bought pieces of various technologies to cobble something together that works. With Unirisx, General Agencies no longer have to settle for systems designed to meet someone else’s needs. Our system delivers big carrier functionality that can be used á la carte by GAs to meet their unique needs, all at a very affordable price.
Systems that are reasonable in cost AND fit your business. What a great concept! Just another way we are breaking the mold of insurance IT.
Microsoft Joins The Cloud!
An interesting article caught our attention — Microsoft is joining the World of Cloud Computing. Steve Ballmer, CEO of Microsoft, said in an e-mail to all employees “…..Today, nearly every one of our products has, or is developing, features or services that support the Cloud.”
That’s a big announcement, given Microsoft’s market reach, marketing muscle and install base.
Microsoft joining the Cloud tells us something else: the Cloud is moving from the “bleeding edge” of technology to the mainstream.
And that is truly big news for insurance carriers and General Agents (GA) since Cloud Computing offers the opportunity to lower your total cost of computing (i.e. your Total Cost of Ownership, or TCO).
Unirisx saw the opportunity in the Cloud beginning in 2001, and we have developed the first and industry leading Cloud technology solution for insurance policy administration.
So, on behalf of Unirisx, we’d like to say to our friends at Microsoft, “Welcome to the Cloud.”
