Total pension assets rise to N9.8tn
by Nike Popoola
The total assets under the Contributory Pension Scheme rose to N9.81tn as of the end of October, the National Pension Commission has stated.
According to the commission, a total of N6.91tn or 70.43 per cent of the funds has been invested by the Pension Fund Administrators in the Federal Government of Nigeria’s securities, including FGN bonds, treasury bills, agency bonds, Sukuk bonds and green bonds.
The acting Director-General, PenCom, Mrs Aisha Dahir-Umar, said the CPS had, in the last 15 years, made appreciable progress in addressing most of the shortfalls of the erstwhile pension system.
As of September 30, 2019, she revealed that the pension industry membership had grown to 8.85 million participants while the pension fund assets under management were deployed in critical sectors of the economy.
She said, “The number of retirees under the CPS as of September 30, 2019 amounted to 298,614. Out of that number, 227,400 retirees are on programmed withdrawal and 71,214 opted for annuity.
“In the same vein, death benefits have been paid to 59,057 beneficiaries. These statistics are clear evidence that the CPS has greatly improved access to retirement benefits for employees in both the public (Federal and State Governments) and private sectors.”
Are You Covered? Surge on Fake Insurance Bandwagon
The insurance industry has long been perceived to be steeped in tradition and driven by conservative business values. Consumers have always viewed the process of engaging with insurance companies as bureaucratic, time-consuming, and tedious. However, insurance is a pervasive part of our lives, almost on a daily basis.
Today, customers have wholeheartedly adopted digitally-driven business channels and the insurance industry finds itself in the midst of this digital storm. New products are being built and distributed, purely on the basis of data and analytics. The new players in the insurance space are using digital-only business models, making it easier and quicker for their customers to consume insurance products and services.
Traditional insurance providers need to understand that the use of digital technologies does not lead to the complete overhaul of their business operations. Instead, such technologies focus on the enhancement of the insurance value chain. Even though large insurance companies have understood the need for digital transformation and would like to initiate such change, they still find it challenging to identify the apt areas within their business that are ripe for transformation.
Trends That Drive RIFAN
More than 90% of insurance CEOs emphasize the importance of data in understanding customer needs and making enterprise-risk related decisions, yet only 10% believe that the data they receive is comprehensive. This is a clear indicator of how the harnessing of data through technology is crucial to the future of the insurance industry.
Data is at the heart of innovation in any industry, especially in insurance, as the amount of customer data being generated is huge. Also, it is a balancing act for insurers, as insurtech-led transformation is not just about changes in technology, but also altering their existing business models.
The trends mentioned below focus on customer satisfaction and retention, leveraging of customer data to obtain precise market insights, application of AI and machine learning across the insurance value chain, automation of insurance platforms, and much more.
- Business Process Transformation: Traditional insurance companies must prepare for the future right away by innovating digitally. Else, they might find their business being eroded by early adopters of digital technologies and insurtech startups. The digital transformation of insurance processes is holistic in nature, as the complete business model has to be changed, instead of piece by piece. Insurers must have a digitally driven, customer-centric business strategy in place.In terms of technology, the focus will be on API or microservices architecture, which will enable insurers to find a way to work with transactional legacy systems such as RIFAN, as well as permit interconnectivity with other systems. RPA can also be deployed to enhance customer interaction and data harvesting.To achieve the goal of complete business process transformation, insurers must first clearly define their business processes, identify the issues that have to be resolved, and determine the opportunities that can be exploited. This will then establish what needs to be removed, automated, outsourced, and the technology solutions that provide the best possible ROI.
- User-driven Ecosystems: Customers today are looking for an integrated user experience that provides access to a set of interconnected products and services. Placing the customer at the crux of digital initiatives can help insurers rapidly scale adoption of their products and services and acquire previously unheard value.Ecosystems can help users manage and access different products and services, without having to switch between different portals, handle different login credentials, or waste time maintaining various applications. Insurers have the potential to engage and partner with players within and outside of their domain to effectively connect and engage across a much broader user base.For example, Progressive corporation has partnered with Zubie, a GPS fleet tracking system for businesses, to provide customers with insights into how their driving habits might impact their insurance premiums. Insurance companies that have adaptability as an integral part of their product design and business strategy will be able to fully exploit the benefits of a digital ecosystem.
- AI and Machine Learning: Insurers need to collaborate with insurtech service providers to take advantage of the benefits that AI and Machine Learning can bring to their business. These technologies can simplify customer onboarding and greatly improve customer service. For example, insurance used to depend on statistical sampling to build risk pools. Now, IoT sensors allow insurers to base their coverage price on real events through data obtained from individuals, rather than group data samples.AI can also be leveraged to completely transform critical insurance functions, such as fraud detection, underwriting, insurance premium pricing, and much more. AI generates a huge amount of data, which can be used to obtain more customer insights and subsequently insurers can convert these insights into actions.Insurers can identify and bridge gaps in data, processes, product, and customer interaction through the application of AI/MI and other allied technologies.
Insurtech is bravely moving forward, with or without you
Insurtech is no longer an afterthought, but the central driving force of digital transformation in the insurance industry. However, such a transformation and adoption of new technologies will not be successful without a paradigm shift in how the insurance industry works. Long-term business sustainability will be in question, if insurers fail to adopt a digital-first approach. It is important for insurers to think beyond the constrictions of their legacy systems to provide a customer-centric architecture. The path to digital transformation is not without its risks or bottlenecks, but the ultimate prize is worth the effort and time.FacebookTwitterLinkedInPinterestBack to blog
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Technology and Innovation in the Insurance Sector
Technology and Innovation in the Insurance Sector
The technology will enable insurers across the country to efficiently enable predictive analysisNEXT »
Image credit: shutterstockRahul AgarwalChief Technology Officer of Policybazaar.comSeptember 2, 2019
As the insurance industry is evolving, so are the customers. Insurers are constantly receiving ideas from all the corners, and thanks to technology. And this is impacting our consumer behaviour. The state of the insurance sector in our country is entirely different from that in other countries. Despite constant liberalization of the current insurance industry, a major part of the population still does not believe in any insurance. This is majorly because the many challenges associated with the sector including a split ecosystem, regulatory uncertainty, and disjointed data continue to remain specific.
Innovations Help
With the constant advancements and better use of digital tools in the last few years; most of these challenges seem to be addressed efficiently. While technologies such as Robotic Process Automation (RPA), Artificial Intelligence (AI), Blockchain, and Advanced Analytics are working as promoters to enhance the importance of insurance, the insurers are working hard to create a more streamlined and integrated insurance system.
Analytics is expected to play a great part in driving the insurance industry in the coming few months. The technology will enable insurers across the country to efficiently enable predictive analysis. Insurers can leverage analytics to make predictions about a person’s probability of getting an ailment and therefore, timely suggest him to take necessary precautions. This can be done by implementing intelligent health analytics to a patient’s medical history in order to predict the future health approach. The technology can even prove positive results for deciding the best course of action, in terms of identification of most effective treatments and drugs resulting in cost-efficient treatments.
Customers Have Changed
Today’s tech-savvy customers look for digital tools and experience from their insurer at par with what they receive from any e-commerce or any other retail industry. While talking about the insurance industry, the consumers these days’ demand digitally-oriented applications or websites that provide complete customer support. Many insurers have already started adapting digital tools to make it easier for their customers and their family members to navigate the healthcare ecosystem. Some of the powerful features of the tools include digital on-boarding, ease of selecting plans based on cost and preferences, and personalized content for better understanding of the claims.
Yet another impressive trend that the insurance industry is witnessing is the introduction of ChatBots and Voice Assistant for enhanced and meaningful customer engagement. Both these technologies are gaining quick popularity amongst the insurers as well as the consumers. The technology specifically leverages Artificial Intelligence (AI) to simulate productive conversation with its users while delivering powerful customer engagement. One of the important reasons for the introduction of ChatBots and Voice Assistant in the insurance sector is the increasing aged population that demands continued care.
Fortunately, insurance service providers in India have now started moving towards a system of the preventive model of care. The model specifically aims at providing proactive wellness initiatives to the consumers while using IOT powered devices. Moreover, there is a high demand for personalized offerings in the market as customers are quite willing to adopt proactive, customized devices from their insurance providers. The initiative would involve real-time monitoring of a customer’s parameters for timely care interventions while promoting healthier lifestyles through wellness initiatives.
