LAUNCHING A NEW INSURER IN A NEW MARKET: IMPLEMENTATION INSIGHTS Bruce Sahd 7 th Insurance Distribution & Insurtech Conference, 1 September 2017, Cape Town
CASEJOHNSON IS AN INNOVATION PARTNER How we help o Strategy & Implementation o 3P approach Plan, Pilot, Profit What we specialise in o 3D strategies - Data, Direct, Digital o Emerging markets - Africa & ME Where we have worked o SA, Ghana, Nigeria o UAE, Lebanon o India, Sri Lanka
text Setting the scene.. Are insurers good innovators?
INSURERS ARE USING PARTNERS TO INNOVATE KPMG s global survey* notes that almost seven-in-ten respondents say that they believe partnerships, not in-house efforts, will characterize the future of innovation for their organization. Fiftynine percent of respondents say they already work with external advisors and consultants to drive innovation. too many in the insurance world are focused on operational innovation rather than strategic growth-oriented innovation The potent combination of data and digital is driving increased innovation within the sector Respondents from the Property & Casualty (P&C) sector reported being more focused on innovation-led growth than their Life & Health peers * Source: www.kpmg.com/cn/en/issuesandinsights/articlespublications/documents/a-new-world-of-opportunity-insurance-innovation-o-201509.pdf
DIGITAL INSURANCE IS STILL IN EARLY DAYS EY in their digital insurance survey* notes that Insurers ambitions are high, but are constrained by digital capabilities and by traditional culture Insurers want more direct control and better customer experience, but are faced with channel conflict Data analytics is critical to future digital success * Source: EY "Insurance in a digital world: the time is now"
EXISTING TEAM IS OFTEN LEAST PREFERRED Source: The Digital Insurer, Poll 2015
text CASE STUDIES: 1- Launching a new STRATEGY which is very different from 2- Launching a new INSURER
text Case Study No. 1 Launching a new STRATEGY
C A S E S T U D Y 1 LAUNCHING A NEW STRATEGY First ever tele-bancassurance project in Ghana launched in early 2017 Responsible to plan strategy and steer implementation of the pilot campaign Selling a simple life product to bank customers over the phone Regulators approved electronic signature but with strict conditions Outsourced sales to a local contact centre
C A S E S T U D Y 1 LAUNCHING A NEW STRATEGY Local experience was lacking Learning curves were steep Tactical interventions were needed! Target was achieved!
W H Y SUCH INNOVAT ION PROJECTS OFTEN FAIL In my experience, failure is because of Vision: Not a clear enough vision nor commitment to see it though Strategy: Launched on the wrong strategy Structure: Run by existing team not by a separate accountable business unit Priority: Under-prioritised and derailed by core business priorities Skills: Unable to secure the right specialist skills who ve done it before Urgency: Lack of urgency without clear goals and deadlines Planning: Badly planned, poorly budgeted, unrealistic timelines Risk management: Faces risks that were never identified in planning Resources: No devoted resources, focus & leadership
text Case Study No. 2 Launching a new INSURER
C A S E S T U D Y 2 LAUNCHING A NEW INSURER Doozy Insurance created in May 2017 First direct insurance brand in Lebanon (possibly ME) Lebanon is a small market but a leader in the ME region Quest Global is the key driver & manages operations Arope Insurance is brand owner, underwriter and key partner
C A S E S T U D Y 2 LAUNCHING A NEW INSURER
C A S E S T U D Y 2 LAUNCHING A NEW INSURER o planned the strategy o built the technology o designs the products o provides the call centre o administers the policies o operates the venture A DIRECT INSURANCE BUSINESS BY AROPE, OPERATED BY QUEST o owns the brand o underwrites the products o pays the claims o funds the venture
C A S E S T U D Y 2 LAUNCHING A NEW INSURER Started with Motor lines of insurance Market has a big gap between upper end & lower end New products were designed to fill the affordability gap Distribution strategy is also to target the better risks Aims to grow the market & take a share TP Compulsory Only (bodily) TP Liability (bodily & material) TPGR Guaranteed Recovery COLAR Collision All Risk CMP50 Comprehensive 50% adv bonus Comprehensive All Risk $ 65 $ 120 $ 200 $ 350 $ 600 $ 800 300 k 600 k 300k 10% 5% 2% 5% 60k 30k 12k 15k = 117k sales = 1.2m total
C A S E S T U D Y 2 LAUNCHING A NEW INSURER LEAD SOURCING SALES CONVERSION data data data data data data data data data A 3-D strategy is underpinned by DATA, DIGITAL & DIRECT
C A S E S T U D Y 2 LAUNCHING A NEW INSURER Every insurer should have a data strategy first, and a digital strategy second, even if they don t necessarily have a direct strategy Over H. Eard
text Implementation Insights
Insight No. 1 Innovation is easy to talk about but difficult to do!
Insight No. 2 Data, Direct & Digital are implemented together we saw obvious synergies between the 3D s
Insight No. 3 Data is always at the core we launched with data-driven technology platforms
Insight No. 4 Direct delivers quickly we set up a small telesales team to bring in some early sales
Insight No. 5 Digital is a journey we started patiently using SEM & Facebook
Insight No. 6 Choose your partners carefully we sold the strategy to an insurer with vision & courage
Insight No. 7 Lean on an old brand to build a new one we leveraged our partners brand at every turn
Insight No. 8 Don t launch new ventures with old cultures we agreed on the need to operate separately from our partner
Insight No. 9 Navigate carefully around regulation we leaned heavily on our local insurance partner
Insight No. 10 Don t skimp on planning we involved the core team and wrote it all down
Insight No. 11 Manage every campaign as a project we used a strict project management approach to track & learn
Insight No. 12 The project manager rules we appointed one person to be the central driver
Insight No. 13 Be guided by specialist advisors we sourced a multinational panel of experts who d done it before
Insight No. 14 Embrace startup culture we hired a team that is comfortable with uncertainty
Insight No. 15 Piloting is about testing & learning only we kept reinforcing that making money is not the initial goal
Insight No. 16 Technology must remain a tool of strategy we didn't allow the techies to take over
Insight No. 17 Find a media agency that loves science we insisted on only buying media if ROI is measurable
Insight No. 18 Don t aggravate intermediaries we only point out that distribution economics will change
Insight No. 19 Make a splash with an innovative product we launched with a flagship product that had instant appeal
Insight No. 20 Reporting must be real-time we covered the walls with dashboard screens
text Thank You & Good Luck!