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Putting your insurance needs first

Putting your insurance needs first

21 Jun 2018

Riaan van Dyk, Group CEO of Assupol, a proudly South African insurance company, discusses insurance in the digital age, how to choose the right policy and their customer-centric approach

Please could you tell us about yourself?

I studied Actuarial Science at Stellenbosch University. I started my career at Metropolitan Life in 1988 and qualified as an actuary in 1990. Whilst at Metropolitan Life, I fulfilled various roles, primarily as a Product Development Actuary and later as a Marketing Actuary, where I spent a lot of time supporting the distribution channels with appropriate products and actuarial support. I left Metropolitan in 1996 to establish a new multi-management asset management business for Momentum, prior to taking the role as the CEO of Momentum Wealth. Over the period since 2009, I was the Managing Director of Natsure, a specialist short term insurance business. Additionally, I was a Non-Executive Director and also chaired the Risk Committee and Remuneration Committee of the Assupol group between September of 2013 and March of 2017 before becoming the Group CEO from 1 July 2017.

How does the ever-changing regulatory environment affect your business?

Effectively comprehending and implementing changes in adherence to both new and impending regulation is a critical component of Assupol’s operating strategy, especially in regard to the South African financial services sector in 2018. Under the Twin Peaks model (which incorporates solvency assessment management and treating customers fairly), the establishment of two authorities in alignment with the Financial Sector Regulation (FSR) Act is among the most significant developments. The Prudential Authority and the Financial Sector Conduct Authority (previously known as the Financial Services Board) are important stakeholders for Assupol. Furthermore, the Insurance Act—which has been signed into law but is not yet effective—is aimed at driving financial inclusion, something Assupol feels strongly about as it arguably impacts our customer segments more than any others. Impending regulation from the RDR proposals, the Cybercrime and Cybersecurity Bill, and POPIA are all aimed at the protection of customer data and financial integrity to ensure the customer is not disadvantaged in any way. Our reputation is sacrosanct and so is maintaining a good relationship with the regulator, the changing environment is part of the game and we do not consider ourselves victims, we adapt and we look for opportunities.

How has technology changed the way you operate and how the customer approaches insurance?

Technology has shifted everything in most industries. For us, the proliferation of available customer data allows us, on the most basic level, to streamline and optimise the actuarial process. What’s more, it allows the backroom operations to streamline and share important information across business areas in an efficient manner. All these benefits are passed on to the customer in cost savings. From a customer perspective, technology and the digital world have completely transformed how they approach insurance. We must remember that insurance isn’t an isolated thing in the customer’s world, and so every customer experience they have in the world—which is more and more a digital experience, or a digital/ real-world crossover experience—influences what they expect of every other business too. What this means is that, essentially, customers now expect some degree of digital access to their own information, as well as digital means of signing up and managing their insurance as well. At Assupol we fundamentally believe in the power of face to face advice and we also see technology advancing the delivery of advice.

 

How has the current global macroenvironment affected your business?

Global, social and political instability (ongoing protest action, Brexit, rising unemployment, and etc.), an overall climate of low-economic growth, challenges of food security and severe weather events were among the tribulations that characterised the global macro-environment in this past year.

There is a revival of interest in South Africa and promises of increased FDI flows—the R858 million funding deal for the next four years secured from the UK coupled with India’s promised R1 billion and the IMF’s upgrade of South Africa’s growth outlook are certainly all positive economic indicators.

However, we must keep in mind that despite a sense of optimism, our country’s ability to truly deliver on more substantial reforms remain constrained by our operating realities, which, in turn, have an impact on South Africa’s people.

This means that more than ever, they require the certainty and peace-of-mind that comes from investing early in retirement, savings, life insurance and funeral policies such as ours. We are witnessing fundamental changes in the political environment, we are hopeful that this change will strengthen growth opportunities in the country.

Assupol is committed to playing a consistent role in the development of the economy.

What are some of the do’s and don’ts when choosing life and funeral cover?

Choose insurance that fits your need, not because it’s the cheapest you can find. Even though the price or premiums must be one of your considerations, your main objective should be to get the best possible value in covering you and your loved ones.

Also, you need to remember that the questions you ask before taking up a policy go a long way in helping you get the cover you want. Life or funeral insurance is about securing yourself and your family from financial hardship in the event of losing a family member, take the necessary time to make every decision right. Insurance is offered in different forms. You can, for example, select cover with constant premiums or ones, which increase annually. Whichever one you choose, you need to know how much your pay-out will be.

Most funeral insurance providers promise to pay-out within 48 hours but it is essential to understand the requirements for your claim to be successful. An insurance claim that takes longer than it should, could lead to financial difficulties. Make sure that the person or provider selling you the policy is licensed by the Financial Sector Conduct Authority (FSCA) as a financial services provider (FSP) or is a representative of an FSP accredited to market the products of a registered company.

Also, ensure that the company whose policy you are being offered is a registered long-term insurer. You can check this with the FSB either on their website or if you call them.

The intermediary must be able to produce marketing material from the registered life or assistance business company underwriting the policy, providing more information about the policy you are about to buy. Once the policy has been issued, you must be given a summary of the conditions and requirements relating to the policy. You then have 30 days to change your mind. Make sure you receive a policy certificate with information about who is covered in terms of the policy, the amount of cover, the premium, as well as a clear breakdown of costs.

Ensure that you receive a receipt for every cash payment you make each month to cover the policy premium. The receipt must display the information of the insurance company that has underwritten your policy.

Can one be over-insured?

Absolutely, yes! We need to remember that as much as we need insurance for death, we also need investments for life! Statistics show that although funeral insurance tends to be the most prevalent insurance in South Africa, the fact of the matter is that most of us are statistically at a far greater risk of job loss.

And very few of us are insured for that or have sufficient savings and investments to cover us in the event of a job loss.

What’s more, South Africans are chronically under-covered when it comes to retirement as well. The very best way to manage this is to find a financial advisor who can sort through your financial situation and advise you on how to spread your insurance and investments and manage your risks while taking care of the present and the future.

What advice can you give to people who may fall prey to fly-by-night type insurance companies that are here today and gone when you need them?

For starters, whenever you purchase any kind of financial service product, make absolutely certain your provider is a reputable insurance provider licenced by the FSCA.

Check this on their website, or by calling them directly. When looking into taking out a new policy, check not only to see if your provider is verified but investigate their financial soundness, their claims settlement ratio and their customer service stories. This will help you decide if the company you want to take a policy with is, in fact, legitimate and can, in fact, back up their claims. If you have already fallen prey, contact the long-term insurance Ombudsman to see if they can help resolve your query.

How sensitive is Assupol to its environment and climate change?

Assupol remains conscious of its strong interdependence with and strives to make a meaningful contribution to, the communities and natural environments in the regions in which it operates.

The company subscribes to the principles of sustainable development and through its business strategies, aims to ensure that sound, sustainable practices are developed and maintained across its operations. Our underlying environmental philosophy is to continually investigate means to reduce the environmental impact of our operations and we invest in new technologies and infrastructure. Assupol strives to comply with all the applicable in-country environmental regulations and environmental management at our operations.

What is your view on increasing new competition entrants in the insurance industry?

Assupol welcomes competition as it brings attention to a sector in which our heritage stands tall. We are a pioneer in the insurance industry in South Africa with a heritage of innovation and informed risk analysis that has helped our industry evolve. We benefit from a huge amount of experience in deeply understanding the needs of customers and creating insurance products and risk solutions that address their challenges.

Assupol achieved a number of firsts in the insurance sector, including being the first insurer in South Africa to commit to a 48-hour turnaround on claims payments, the first to make cash claims payments via the post office to beneficiaries without bank accounts and the first to utilise the government’s Persal system as an efficient payment method for policy benefits.

What role does local leadership in your region play in the company?

Assupol is a diverse organisation that believes in the development of employees as well as intra-regional capacity building, no matter if they are KwaZulu-Natal people working in the Western Cape or North-West Province’s working in the Free State—or any other combination. We are a South African company with many employees, some working in their home markets and some benefiting from exposure to other regional markets.

While we prioritise the appointment of local community and local leadership, experience has taught us that fostering the development of employees who can work across a range of geographies sharing knowledge, expertise and best practice is to the long-term benefit of our organisation as we pursue sustainable growth.

How important is employee wellbeing?

Our people are key to achieving the company’s capacity to create and sustain value. Attracting, developing and retaining our people is central to our business strategy and we administer an array of training, managerial, organisational, leadership, executive and self-development programmes across the organisation. We continue to invest in the development of our employees, understanding clearly that their skills, experience and diversity enable us to provide competitive and reliable products and services to our clients. We invested in employee training and development. Evidence of this is our Capital Finance International (CFI.co) Best Life Assurer Southern Africa Award we received for 2018 as well as the 2018 platinum seal of approval awarded by Deloitte in the 2018 Deloitte Best Company to Work For survey.

What’s your view on diversity?

We leverage on our diversity in order to maximise performance by actively supporting transformation initiatives. Because we value innovation, creativity and inclusion, we respect each other’s opinions and perspectives, treat people with dignity and respect and build culturally diverse teams. Research shows that companies that invest in diversity initiatives not only perform better commercially but are also more cohesive internally and benefit from more business-focused innovation outcomes.

Is education still critical?

Assupol believes that education is fundamental to the empowerment of a South African citizenry capacitated to build sustainable economies that safeguard their future.

We believe that early childhood development (ECD) initiatives are particularly important as it is in this critical stage of a person’s development that their future potential can be positively or negatively impacted. Factors such as inadequate access to proper nutrition, human interaction or appropriate intellectual stimulation are all serious risks to a child’s ability to maximise academic opportunities in the formal schooling environment. Assupol believes that our nation cannot be built on poorly capacitated ‘grey matter infrastructure ‘—our children are the future and proactive risk mitigation requires that we invest in their wellbeing ahead of the curve, so they can move our country forward towards its potential.

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