The decade ahead: Issues facing insurance CEOs in the 2020s
“A world class underwriter can be as valuable to an insurance company as Lionel Messi has been to Barcelona.“
In the 2020s, insurance chief executives will have a rare chance to demonstrate the value of insurance for economic development and social wellbeing. This opportunity should not go to waste!
For most of this year, policymakers throughout Africa – as in the rest of the world – have taken actions to mitigate the short-term risks from Covid-19. These have included lockdowns, quarantines, border closures and curfews. Sectors such as hospitality, sports, the arts and education were all told to cease trading for months. Whilst not being instructed to shut, insurance was indirectly affected by slower economic activity and an unexpected mix of claims.
As the year draws to a close, government attention is increasingly turning to revitalising economies from the shutdown. A year ago, Africa’s development curve pointed strongly upward. If businesses are to survive and thrive, and families are to look to the future with confidence, the continent’s optimistic spirit and energy must be reawakened. This is where insurance will play an invaluable role.
The pandemic is likely to have a lasting influence on strategies and behaviours. Businesses are likely to be more conscious of their environmental risks. Families are more likely to re-evaluate their life goals and financial resilience. The next generation will look increasingly for careers providing a balance of security and reward. In each of these situations, the insurance profession can prove itself a reliable friend during uncertain times.
If insurers rise to these challenges, they will prove, once and for all, the huge social value of a relevant, responsive, forward-looking insurance sector working in partnership with employers and individuals.
In many parts of Africa, insurance penetration remains modest by global standards. There is no reason for this legacy to persist. On the contrary, technology innovation provides unprecedented opportunity to widen insurance accessibility, supported by product innovations such as microinsurance and parametric insurance, and the potential of insurance apps to simplify products, improve choice, and speed the settlement of valid claims.
Leveraging this will depend, of course, on people: Talented people, highly knowledgeable about their discipline, working to unimpeachable standards of ethics and conduct.
During a period of rapid change, the workforce in any service business will always be a vital asset. Getting the right people in the right jobs is a never-ending challenge.
A world class underwriter can be as valuable to an insurance company as Lionel Messi has been to Barcelona. Brokers will only maintain their credibility with clients if they’re able to attract and retain people who have the knowledge and skills to build long term, trusted relationships with their clients.
There may be fewer professionals due to automation. But those remaining in the market will need greater levels of expertise to compete. Successful insurers will not simply be those with vast amounts of capital. It will be those with a workforce of trained professionals who can adapt, innovate and challenge.
That’s why advisory skills will rise to the fore and may eventually outweigh knowledge skills, especially when knowledge is freely available at the push of a button. With AI taking over routine jobs, it will not be long until over half the roles in our sector have a strong advisory element to the responsibility.
And this will give rise to what, at the CII, we call the complete professional. In the same way that medics need a soothing bedside manner, or lawyers need the skills of persuasion in front of a jury, the complete insurance professional in the 2020s and 2030s won’t simply be someone able to recite risk factors from memory.
It will be someone who can listen, interrogate, communicate and apply knowledge. Individuals holding a cupboard full of A star certificates, but who lack the behavioural or emotional intelligence to function in awkward or unpredictable circumstances, will be unable to fulfil their professional obligations.
That’s why we have been advocating the concept of the Chartered ethos. At its heart is courage – sticking with your convictions and speaking your mind. None of us has a monopoly of wisdom, and successful CEOs in the 2020s will increasingly need to foster a culture of collaboration, openness and participation. Only by blending the insights and experiences of every one of us can organisations survive and thrive during turbulent times.
The importance of sharing experiences and ‘best practices’ is one of the reasons that the CII has released its landmark publication ‘Africa: Continent Of Promise – building a trusted insurance and financial planning profession’. This report, freely available on the CII website,
The importance of sharing experiences and ‘best practices’ is one of the reasons that the CII has released its landmark publication ‘Africa: Continent Of Promise – building a trusted insurance and financial planning profession’. This report, freely available on the CII website,
During the research for this publication, I encountered many inspiring stories, and I encourage insurance CEOs everywhere to give them serious consideration for potential lessons to be learned. My discoveries included:
• The company using ISO certification, the Lloyd’s of London Inclusivity Pledge, and the CII Financial Flexible Working Pledge to raise standards
• The company accelerating promotion opportunities for all certificate, diploma and ACII qualified staff
• The company which lists professionalism as its most important core value
• The company that has established an Academy to equip staff with knowledge and competence
• The company that invited insurance practitioners throughout Zambia to participate in a virtual meeting about professional development
• The company using its leadership position to lead the social and economic development of an emerging nation
• The company blending technical insurance competence with business skills to drive innovation and transformation
• The company which has shared four inspirational stories where its people describe the impact of their learning on their careers
• The company which encourages staff to show solidarity with their communities • The company which uses succession planning to provide career paths and motive and retain its best people.
The speed of change is accelerating. Almost all the companies which were in the ‘global top ten’ in 2000 (WalMart, IBM, UPS, Genera; Electric, Bank of America) have now fallen from the list – to be replaced by the likes of Apple, amazon, Alphabet. Facebook and Alibaba. In 2000, nobody foresaw 9/11, the banking crisis, the rise of social media, or Covid.
I’m sure there will be similar surprises throughout the ‘20s. With a workforce of trained professionals, conscious of their role in providing a valued public service, insurers will be better placed to earn trust, serve customers and deliver robust financial returns throughout the decade ahead.
