By Steve Piper, Chief Distribution Officer at Bidvest Life
For many South African independent financial advisers (IFAs), Covid-19 disruptions saw them having to interact digitally with their clients for the first time. Now, virtual interactions with customers have become a standard expectation from many policyholders – and it might just be exactly the incentive the adviser community needs to embrace a more digital way of working, with massive benefits for everyone in the value chain.
Technology has the potential to bring significant innovation to the insurance industry. For advisers, the opportunity is to develop the ability to deliver personalised, high-quality advice digitally, building a profitable core of customers in the process.
The rapid advance of digital technology is allowing advisers to be remote and face-to-face at the same time. Fact is, most consumers prefer a hybrid model of digital-human services, so advisers that get this mix right will be better positioned to service their current customers and acquire new ones.
According to Stats SA, around 65% of South Africans belong to the Millennial, Gen Y, Gen Z or younger generations. The youth (18-34) make up a third of the population. They’re the industry’s future customers, and giving them the ability to get advice, and buy insurance digitally, isn’t a nice to have – it’s table stakes for any insurer that wants to stay relevant.
But customer preferences aren’t the only driver for the move to digital servicing. It’s cheaper and more efficient, eliminates unnecessary travel, reduces the need for extensive office space, and saves time spent getting to and from in-person meetings. This allows advisers to spend more time finding and connecting with prospects and giving proactive advice to existing customers.
It’s not just advisers who are turning digital, though. Insurers are moving rapidly to reshape their product offerings based on new customer insights and relevance. They’re also taking the entire insurance process online, from electronic signatures and telephonic recorded acceptances of policies to digital communications and claims processing.
While it becomes easier for consumers to interact with insurers through a variety of digital channels, the role of the adviser has become more critical than ever.
The new generation of customers is looking for holistic advice that talks to their specific needs – and they don’t always want to get it from a call centre agent or an online bot.
Clients are looking for relationships; they want to trust that an adviser understands their financial needs and has their best interests at heart. That’s always been the cornerstone of the life insurance industry. And just because we’re delivering that advice, together with simpler products, over a video call rather than face to face, doesn’t make it any less valuable or necessary.