If the pandemic has done one thing, it has forced insurers and reinsurers in the Middle East to think about what their business will look like in two years or five years – and what they need to do today to make themselves ‘future-ready’.
This is true for those operating in the life and non-life sectors alike. Having been caught napping by the coronavirus – and having been forced to take emergency remedial measures involving work-from-home and mental health counselling – insurers are now most keen to be ahead of the curve on all emerging developments that might affect their business for good and bad.
While no one knows precisely what the future holds in store, where better to get a sneak peek of what life will be like in the near future than the annual Consumer Electronics Show – where manufacturers show off the latest gadgets and gizmos? Typically held in Las Vegas, it was held virtually this year and was no less ‘sci fi’ for that.
The overarching theme this year was personal health – both physical and mental – that offered the promise of an antibacterial, antimicrobial future filled with meaningful but virtual social interaction to keep people both sane and safe.
For the life and health insurance sectors, these prospective developments may turn out to be a boon – from needleless blood glucose monitors to remote heartrate monitors. The market for connected health monitoring devices has already nudged into the multi-billion dollar category and looks set for more explosive growth in the next few years.
The key for insurers in the region will be to persuade their customers to spend their accrued savings on personal covers – which could be a big ask, considering that many, if not all, consumers still think that insurance cover is ‘sold not bought’.
It might be useful if serious players in the Middle East region successfully tapped into the ‘revenge spending’ trend that is fast becoming the new fashion for 2021 – where consumers go all out to pamper themselves for a change after putting up with the privations and restrictions of the past year.
It seems that consumers are only too happy to spend the money they have saved by not eating out, not going to the theatre, not going to the cinema and not going on holiday. But they want to spend the money on themselves in such a way that it brings a bit of happiness and joy back into their lives. In short, they want to buy luxuries not essentials.
We can see how it might be easy to get a revenge-spending consumer to splash out finally on upgrading to the new iPhone – but how to get them to spend the money on insurance? By pitching insurance as a luxury not an essential?
That is where technology and first-party data comes in – allowing insurers to get closer to consumers, understanding them better, refining insurance products to enrich the fit of the product with the experience the consumer is looking for.
Reinventing the consumer experience with game-changing innovation is only part of the equation. It is also about gaining perspectives on new technology markets and shifts in consumer behaviour and expectations. In short – designing products to suit consumers rather than insurers.
Paul McNamara
Editorial director
Middle East Insurance Review