The future insurer: A catalyst for change, not just a safety net
Insurers can become trusted stewards, making a positive impact on individuals, society and the planet
THE insurance industry stands at a pivotal juncture, where current opportunities are also profound responsibilities. This unique situation offers a chance to redefine product development, distribution and the sector’s societal impact.
The choices made today will shape the industry’s future role, emphasising the deep connection between seizing opportunities and fulfilling our duties.
The industry must evolve from being a mere safety net to becoming trusted partners, meeting the growing and changing needs of consumers.
The AXA 2023 Future Risks report revealed that 93 per cent of experts and 74 per cent of the public globally view insurers as crucial in mitigating future risks such as financial instability and climate change.
This underscores the necessity for insurers to move beyond simply reacting to risks, to proactively preventing losses and offering comprehensive solutions.
Personalised solutions: Beyond the basics
The era of one-size-fits-all financial products is over. Today’s consumers demand highly personalised solutions that integrate seamlessly into their lives.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Imagine an insurance policy that not only provides financial payouts but also anticipates and responds to your needs.
Upon a dementia or cancer diagnosis, for instance, your insurer might connect you with a network of specialists, care providers, and social services, tailored to enhance the quality of life for both you and your caregivers.
Technology plays a pivotal role in enabling these hyper-personalised solutions. Innovative insurers leverage open architecture systems, separating product manufacturing from distribution.
This flexibility allows for product adaptations based on consumer needs and fosters collaboration with external organisations, including healthcare providers, investment firms, and social services.
Such a collaborative approach, facilitated by an open architecture model, creates a comprehensive ecosystem offering a broad range of customised products and services across insurance and wealth management.
Addressing an ageing population
The global population is ageing rapidly. The number of people aged 65 and older will double by 2050, with Asia leading this trend.
In Singapore, nearly a quarter of citizens will be over 65 by 2030. This demographic shift presents both challenges and opportunities for the insurance industry. As people live longer, they will require more medical care – leading to higher claims.
Insurers have a crucial role in helping people age well. Increased age brings risks such as cognitive decline. In a city with rising living costs, insurers can offer products tailored to seniors’ needs – focusing on mental and physical well-being and caregiving support.
Insurers can also incentivise early detection and prevention of chronic diseases, promoting the well-being of both those affected and their caregivers.
Commitment to ESG: Walking the talk on sustainability
The insurance industry faces growing pressure to prioritise environmental, social and governance (ESG) factors.
Consumers demand greater accountability and transparency regarding ESG issues.
According to PwC, the “insurer of the future” integrates ESG throughout its core operations, educates employees on ESG principles, embeds social responsibility into its core purpose, and ensures transparency in all actions and results.
For insurers, sustainability is not just a buzzword. It influences product development, investment decisions, customer interactions, and partnerships.
Evaluating whether products, services and investments benefit both people and the planet is crucial.
Supporting initiatives such as the United Nations Principles for Sustainable Insurance and aligning investment strategies with the UN-supported Principles for Responsible Investment are steps in the right direction. Financial commitments to sustainable causes further solidify an insurer’s role in addressing ESG issues and building a more sustainable future.
By transcending the transactional role of a safety net, insurers can become trusted stewards – driving positive change for individuals, society and the planet.
It is essential that we do not merely discuss the future but actively shape it. The time to act is now.
The writer is the group head of distribution at Singlife, a financial services company
Copyright SPH Media. All rights reserved.
