F
The employment landscape, encompassing the war on talent, attracting and retaining top talent shifts in working and employment patterns following the pandemic, brings an interesting focus to employee benefits as the one point of leverage and offering that the employer has to bargain with in future. Given that this category scored lower on the benchmark this year, it points to a rethink of how the intermediary and the insurer can work closer together to fill the gap in the market.
This year saw the introduction of a fully digital and online research data gathering.
“As always, this year s winners set the benchmark for the level of product and service excellence that our members deem necessary to extend valued financial and risk advice to their clients, said Van der Merwe.Suggesting that clients should ask their financial advisory or broker if they are a member of the FIA, she says advisory businesses that are members of the FIA belong to an elite business community that protects and promotes the role of financial advice.
Her call for a renewed sense of patriotism acknowledges SA must move to align with the rest of the world to address climate change by doing its fair share, albeit with a understandingclearofits priorities.
industryTheexpectations of customers in the more complex categories, including corporate insurance and employee benefits, are reflected in the lower scores achieved in these categories as compared to the rest, albeit only by single-digit margins, she says.
Members of the FIA gain valuable insights into the market and if advisory businesses are not members, their business may be at a disadvantage.
s inflation rate of about 7% is not the worst. In fact, we fare much better than most developed and developing countries, said Tladi.
Members experiences are considered and ranked in importance across eight standards of excellence: the intermediary’s overall satisfaction with the product provider; their perception of service, product and relationship quality with the intermediary; how well the product provider aligns with regulations in treating customers fairly; the trust in the provider; effective complaint resolution; andthe degree to which the product supplier enables the intermediary to be successful through their value offering to the market and clients.
Eight of the nine category winners scored an index mark above 80%, which is considered an exceptional performance on any benchmarking standard, says Ineke Prinsloo of Dail Consulting, who conducted the survey with InSites, on behalf of the FIA. In four of the categories the winner and two runner-up brands all achieved a score above the 80% mark. The inaugural penetrated.particularandregardedserviceslifefollowedandwereachievedbenchmarkalsomanagementunderwritingagenciescategoryopeneditsscorecardwithaof80%.Thehighestoverallscoresacrossthebenchmarkintheinvestmentsavingslumpsumcategories,bythemedicalandnon-commerciallinescategories.PrinsloosaysthefinancialmarketinSAisasamaturemarket,insuranceproductsinarefairlywellThedistributionofproductstotheendconsumerprimarilyfollowsfourpaths:intermediarydistribution,direct,banksandalternativeorpartnerships,sheexplains.Amongthetrendsnotedinthisyear
desire to be included in all industry engagements relevant to the sustainability of the intermediated model.
its various stakeholders. The brand refresh, explains FIA president Butsi Tladi, takes the association a step forward in affirming its position as a trusted source and preferred voice for the advisors and intermediaries in SA.
’s survey are the strength of the partnership
This year’ s survey was conducted by InSites and Dail Consulting in partnership with the FIA. Ineke Prinsloo of Dail Consulting says the baseline or benchmark is a reference point or a point of comparison from which organisations can draw inferences on what best practice looks like and what the delta is in performance to the best rated in the category or industry.Atrustworthy and sustainable benchmark such as
feedback from members on the data collection method to reflect an improved user experience.
the FIA Intermediary Awards has a foundation in a credible set of standards, with sufficient flexibility to adapt and be relevant as the operating landscape, intermediary and customer expectations evolve, says fromexcellence.celebratesThePrinsloo.FIAbenchmarkandrecognisesHowever,itsfarastaticconcept.Themethodologyfortheseawardsperiodicallyneedstobereviewedandrecalibratedtoensureitisfitforpurposeandyieldsarelevantandcomprehensiverepresentationoftheattributesthatintermediariesmostvalueinfinancialservicespartnerstheydobusinesswith.TheFIAbenchmarkstudyusesrigorousscientificprocessestoensuretheresearchisconductedproperlyandhaslimitederrororbias.Sinceitsinception,theintermediatedindustryhasundergonesubstantialchanges;newdirectanddigitalplayershaveentered,productsandsolutionshaveevolved,digitaltransformationhasacceleratedandfinancialcustomersneedshaveevolved.Allthesefactorsplayaroleinre-evaluatingthe
between the insurer and the financial intermediary and the fact the insurance industry has been slower to adopt digital solutions than the banking
Reducing unemployment, poverty and inequality are nonnegotiables and go beyond the need to ensure social stability as preconditions for investment and economic growth. There is no question the sustainability of our country relies on our ability to address social issues.”
perspective, we participate in global forums and are recognised as conducivemanythesignificantlyGeopoliticalonthethetosocialthroughoutandrepresentativetheofintermediariesfinancialadvisersthecontinent.Addingthatitseconomicandchallengesarenotuniquethiscountry,shestressedthatindustrymustappreciategrassisnotalwaysgreenertheotherside.Theworldisinturmoil.riskhasincreasedinrecentyearsandeconomicfundamentalsincountriesarenottogrowth.SA
The association recently unveiled a brand refresh which better reflects who it is, why it exists and how it adds value to
SA is not the only country facing challenges and we need to factor that narrative into our advice framework to clients,” she says. “It takes skill and professionalism to be able to understand and provide appropriate advice.
The FIA s strategy relies on three pillars. The first pillar focuses on professional and organisational development.
The primary purpose of the FIA is to guard, develop, promote and represent professional advisory and intermediary businesses in the financial services industry.
The FIA is unapologetic about its
The third pillar is centred on the financial sector and market information. “The FIA is rapidly becoming the point of reference and source of relevant and material financial sector and market information that can assist in making informed contributions to the sustainability and growth of FSPs and of the financial services industry, says Tladi.
The increasing complexity of our industry, products and solutions requires us to continuously improve our skills and knowledge, says Tladi. At the same time, we need to strive to influence our members to adopt sustainable, responsible transformation plans.
“what” and the “how” of the data collected for the benchmark. The 2022 process included an evaluation of the survey questionnaire, the method of analysis and the
Awards honour leaders in financial services sector
The second pillar focuses on advocacy and representation.
The advisers, brokers and consultants who make up the FIA s intermediary membership are an indispensable part of the financial services distribution landscape.TheFIA serves as the de facto face’ of the product provider to the end-consumer, and it is imperative the product and service we receive from product providers empowers us to offer fit-for-purpose, valued financial solutions that deliver as promised, explains CEO Lizelle van der Merwe.
• Annual event returns Lynetteandpandemicpostbiggerbetter,writesDicey
efficiently, but also measures other elements such as the overall service received from product providers.
FIA CEO Lizelle van der Merwe explains that for the FIA, service is about the quality of the relationship and the willingness to engage and support FIA members to underwrite risks fairly and to provide the best value for clients in the event of a loss.
This year, the awards were once again fiercely contested, says Van der Merwe, adding that the winners are recognised as companies that go the extra mile for the FIA intermediary and theirInclients.theNon-Life: Personal Lines category, the winner was Santam, with Hollard Insurance as the first runner-up and Renasa Insurance as the second runner-up.Western National Insurance won the Non-Life: Commercial category, with Lombard Insurance and Hollard Insurance as first and second runners-up respectively.
The FIA ExperienceIntermediarysurveysets a baseline or standard that financial services partners to intermediaries can use to find where they perform well, need to improve, set goals and measure their performance, as rated by the intermediary partner, over time.
or more than 20 years, the Financial SouthernAssociationIntermediariesofAfrica (FIA), together with industry stakeholders, has undertaken a survey to evaluate the FIA intermediary experience of product provider brands and serviceThe survey and the awards resulting from the survey serve as a reminder of the complex relationships that exist between intermediaries also known as brokers and financial advisers and product providers as they join forces to deliver the best possible financial outcomes for clients.
INSIGHTS 6 BusinessDay www.businessday.co.za Thursday 15 September 2022 FIA INTERMEDIARY EXPERIENCE AWARDS 2022 Sponsored content
” she says.
In the Non-Life: Corporate category, Hollard Insurance took pole position, with Santam and Bryte Insurance the first and second runners-up.
In the Underwriting Manager (UMA) category, the winner was iTOO Special Risks, while CIA
Commercial & Industrial Acceptances was the second runner-upSanlam Life Insurance won the Long-Term Insurer: Risk category, with Professional Provident Society Insurance and Brightrock as first and second runners-up.AllanGray won both the Investment Product Lump Sum category as well as the Investment Product Savings category. Ninety One was the first runner-up while Sanlam Glacier was the second runnerup in the Investment Product Lump Sum category, while Sanlam Glacier and Momentum Wealth were runners-up in the investment Product Savings category.Momentum Metropolitan Holdings took top honours in the Employee Benefits Product category. The first runner-up in this category was Sanlam Insurance, while Liberty Holdings was the second runner-upBestmed won rHealthMedicalcategory,Healthcare/MedicaltheSchemeswithMomentumSchemeandDiscoverythefirstandsecondunners-up.
Prinsloo says the 2022 survey yielded the best participation to date: 2,964 FIA members participated with 6,875 ratings of product suppliers across the different categories provided.
Speaking at the FIA s most recent AGM, Tladi said many people make the mistake of being too internally focused, in the process losing perspective around the opportunities available in SA in comparison to otherGivencountries.aworld in turmoil we need to spend time introspecting before making value judgments on crucial issues in conversation or on social media. We need to be reminded about what makes SA the incredible country it is and our ability to pull ourselves from the edge and correct our course.
Our strategy aligns to the strategic priorities of our country and our sector. It acknowledges the progress we have made while at the same time appreciating we are on a journey that requires our commitment she says.
Acknowledging the country s challenges including load shedding, high levels of unemployment, crime and corruption, she pointed out that there are encouraging moves and commitments to addressing these thorny issues.
We used state-of-the-art digital platform capabilities that served a dual purpose: first to improve the experience, including recognising the time taken to complete the survey and, second, to safeguard the protection of information by assigning a unique identification number to the respondent to complete the link.
In 2020 and 2021 the FIA decided to defer the FIA Intermediary Experience Awards and its accompanying survey over economic concerns linked to the global Covid-19 pandemic. This year the awards were back, arguably bigger and better than before. Awards were given in a total of nine categories, ranked according to a comprehensive whole of FIA membership intermediary satisfaction benchmark survey.
FIA CEO Lizelle van der Merwe explains that the value of advice intermediariesthroughcame into the spotlight in the aftermath of the Covid-19 phowadequatebetterintermediariesfromexpertfinancialstartedtheduringConsumerpandemic.benchmarksandpost-CovidrevealedSouthAfricanconsumerhasre-evaluatingtheirprioritiesandreliedonguidanceandsupportprofessionaltonavigateandunderstandwhatexactlyriskprovisionisandtostructureafinancialortfolio,
Lizelle van der Merwe valued
’
On the upside, we have a developed insurance industry and financial systems which make our markets accessible and allow us to attract foreign investment. From an FIA
Association aims to offer products that ‘deliver as promised’
FIA benchmark recognises and celebrates excellence
The association is made up of a community of professional businesses that firmly believes clients benefit from independent financial advice and intermediary services. It also maintains that professional intermediaries play an important role in the South African economy given they are instrumental to significant economic activity and much needed job creation. Consider their role, for example, in advising clients impacted in KwaZulu-Natal by the riots in 2021 or the floods which occurred in Professionalism2022. and transformation are imperatives for the sustainability of the intermediary model.
The intention behind the survey is to influence market behaviours that lead to better outcomes for clients. It not only measures the ability of product providers to pay claims
Empowering generations to live confidently.
Sanlam Individual Life is honoured by the recognition from the Financial Intermediaries Association of South Africa (FIA) as the 2022 Intermediary Experience Award Winner in the category: Long Term Insurer Life/Risk. The last two years of the pandemic demonstrated the benefits of risk cover and we are deeply grateful to our intermediaries for their role in advising clients. Your commitment to empowering your clients to live with financial confidence has helped us make a meaningful difference to the lives of many South Africans.
We thank you for this acknowledgement and will continue to work alongside intermediaries, to ensure that our clients are supported with valuable financial advice and solutions that give them the peace of mind to live with confidence.
Sanlam Life is a Licensed Life Insurer, Financial Services and Registered Credit Provider (NCRCP43). 57251KINGJAMES
BusinessDay www.businessday.co.za Thursday 15 September 2022
One of the biggest benefits of using an investment platform, and even a discretionary fund manager, is that intermediaries are freed up to spend time with
Jaco Coetzee, CEO of SanlamConnect, Sanlam s Distribution business, adds that the intermediary s role is shifting from solely being an investment specialist to a trusted adviser who establishes long-term relationships with clients. Sanlam was named the Product Supplier of the Year in the Life Risk category.
focus on something technology can t facilitate relationships.
By doing so we create and secure better futures for more people. Insurance therefore becomes more than simply taking on a customer’s risk for a premium. Rather, we consciously think about how insurance can take our customers forward, especially in difficult times.
Given a world that is in flux and nervous investors, there is a need now for intermediaries with the right skills to step in and act as coaches, he says.
doesn t believe that will remove the need for objective advice and a strategy for formulating a long-term financial plan.
Product supplier of the year: Underwriting Management Agencies. Justin Naylor, MD of iTOO, holds the award, with FIA president Butsi Tladi on his left, and Barry Taylor, FIA chair: Non-Life Exco on his right.
Corporate customers face a wide range of business risks, from economic uncertainty to unpredictable issues such as load shedding, natural catastrophes and civil unrest all of which have increased the cost of insurance.
detriment of the performance of their portfolios and their ability to meet their savings and investing goals over time, says Tamryn Lamb, head of retail at Allan Gray, the winner of the Savings Investment Product and the Lump Sum Investment Product at the 2022 FIA Intermediary Experience Awards.
He says there are several ways insurers can achieve this. One is risk management: by surveying premises and making recommendations to customers to reduce their risk, cover is made more affordable and the likelihood of disruption to business is reduced.
Intermediaries are increasingly embracing the accuracy and technical expertise of technology to allow them to
Lamb agrees that financial advisers play an important role in helping investors make decisions that are right for their circumstances. Intermediaries have the objectivity and experience to help investors address the challenges they may face over the course of their investing journey. This includes ensuring investors have a well-crafted financial plan that sets clear actions and steps to help them achieve their goals. This will include assistance in investing in the right product, ensuring that return objectives and retirement savings goals take inflation into account, and ensuring their portfolios are sufficiently, but not overtly, Advisersdiversified.alsohelpto ensure investors remain committed to their investment plan, adjusting only as circumstances suggest is appropriate. Importantly, they help investors to manage
All of this is in the process of being replaced by technology.
Creating insurancesmartersolutions
With interest rates and inflation on the rise, investors are understandably concerned about how they can achieve real returns and protect their savings and investments from losing value over time. One of the biggest challenges facing financial advisers, says Lamb, is helping their clients to position their portfolios appropriately to account for an uncertain environment and not to disinvest at inappropriate times.
Product supplier of the year: Long-term Life/Risk. (L-R) Butsi Tladi, FIA president; Deon Theunis and Heinrich Punt from Sanlam; and Greg Setzkorn, FIA chair: Healthcare Exco and Financial Planning.
Duties of intermediaries in the savings and investment space
Most clients don t have an in-depth understanding of investments and tend to feel quite overwhelmed when it
In the past, he says, advisers spent a significant amount of time and research on different asset classes, packaged these assets to meet the client s risk profile and had to regularly rebalance these packaged solutions to ensure compliance to relevant regulations while still matching a client s risk profile.
“
At the same time most organisations are still feeling the effects of the Covid-19 pandemic, which has put huge risk on their sustainability.
Khanyi Nzukuma, CEO of Glacier by Sanlam, agrees with this assessment, adding that understanding the investor includes knowing their strengths and weaknesses when it comes to finances, coaching them and keeping them on track through challenging market periods.
Intermediaries play a vital role in presenting and advising on innovative options such as these to our collective customers, says Omar.
by
their clients, he says Glacier by Sanlam was the first runner-up in the Savings Investment Product category and the second runner-up in the Lump Sum Investment Product category at the awards.
insurance cover.
And due to environmental concerns, coal mining will in future no longer be supported by reinsurers, leaving the entire value chain underinsured or, even worse, sustainabilitydifficultandtransferdemandWecorporategrowingassetsoperationimport,thereHowever,uninsured.saysDeBruin,isasilverlining.Theconstructionandofrenewableenergyprovidesanever-opportunitywithinthemarketsegment.realsoseeinganincreaseinforalternativerisksolutions,asbrokersclientsfinditincreasinglytofindlong-termpriceintraditional
A good adviser can improvesignificantlyaclient’ s
Similarly, advice and expertise around tax and estate planning remainConcedingimportant.there are no guarantees and nobody can predict for certain what the role of a financial intermediary will be in a decade or two, Nzukuma says all businesses can do is stay current and ensure that continuous learning is a way of life. We see our financial intermediaries as business partners and making it easier for them to do business is core to everything we do.
“Uncertainty tends to produce opportunities for those who are alert to them. There is no question that digital transformation is changing every aspect of how we do business. However, it will be the intermediaries and product providers who seek out the opportunities rather than shy away from them who will be the ones who survive.”
Smart product design is another way, offering insurance cover that suits individual customers needs or alternatives to conventional insurance. Hollard Alternative Risk Transfer, for example, offers two options: risk finance, in which customers retain their predictable risk and derive cost savings, and cell captives, in which they effectively become their own insurer for those risks not insured, or are difficult or uneconomical to insure.
“
While investors today are more educated and have access to more information than ever before via online channels, he
WE DIFFICULTESPECIALLYFORWARDCUSTOMTAKEINSURANCETHINKCONSCIOUSLYABOUTHOWCANOURERS,INTIMES
Nash Omar, CEO of Hollard Insure, explains that Hollard’ s business purpose Better Futures requires the business to derive a social dividend as well as a financial profit in everything it does.
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comes to navigating their financial affairs, he says. This is particularly true post retirement when many people realise they will no longer be able to earn an income to increase their retirement provision, and their accumulated savings would need to meet their needs for the rest of their lives. A relationship with a trusted intermediary who really understands the client is therefore critical.”
Advisers also face the challenge of running sustainable practices in an environment mired with changing regulation, complexity and technological advances. Allan Gray has designed its platform to provide high-quality service and administration, technology and tools to support the advice process and reporting.
M tofinancialimportanceunderplayinvestorstheofadvicethe
any
The significant risk around power supply means that insurers and reinsurers have had to take a conservative approach to systemic risks such as grid failure given the significant risk in the electricity value chain, says Coenraad de Bruin, head of specialist insurance at Hollard Insure.
A good financial adviser can significantly improve a client s financial outlook by guiding their financial planning and ensuring that they remain committed to their goals.”
themselves with discipline, identifying and understanding how their emotions can lead them astray in the investing process ” says Lamb.
The solution, he says, is to be smarter about how the company creates insurance solutions, including long-term self-insurance structures for individual customers which can accommodate large limits.
• financial outlook theirmanagingplanning
“
Coetzee agrees technology is not a threat for the specialist investment advisers but rather makes it possible for them to spend time focusing on the client s needs, fears and expectations, ensuring he or she understands the client s risk profile and then selects wrap funds, fund of funds or other packaged solutions to meet the client s needs.
BusinessDay www.businessday.co.za Thursday 15 September 2022
As we move into an increasingly uncertain future, intermediaries will be differentiated not just by these factors, but also by their risk and advice tools and early detection mechanisms that enable risk prevention. Intermediaries who are able to help their clients understand and avoid risk will significantly reduce the cost of insurance for their clients and provide peace of mind.
The days of intermediaries simply selling generic products are limited. The escalation of risk exposure, combined with affordability issues and cheaper alternative channel solutions, means that product push-only business models are ageing.”
Future clients, she points out, have grown up with the internet and are comfortable engaging digitally. This opens the door to globalFirmsopportunities.needtobe focusing on their future clients as well as their existing clients, given the transfers in intergenerational wealth that will be taking place in years ahead. Those who don’t have a relationship with the next generation will be losing business, says Van der Merwe.
here is simply no substitute for Nashtointermediarieswhatbringthetable,saysOmar,CEOof
“
Karin Muller, retail head at Sanlam Individual Life, the winner of the Long Term Insurer in the Life or Risk space, reveals that the business has long been based on mutually beneficial relationships and engagement intermediaries.withThey are
The risk landscape has seen fundamental changes in the past few years. The World Economic Forum Global Risk Report for 2022 says the biggest concern is around societal and environmental risks.
focus of providing a product to satisfy a need. That won t work in the future. Intermediaries can no longer rely on one engagement a year to discuss a client s changing needs, desires and expectations.”
However, there are many other risks that have not had the same publicity, but that have the ability to impact clients significantly, he adds.
What will ensure the future success of advisory businesses in SA, she says, is to reshape the way advisers interact with their clients to stay ahead and relevant. “For intermediariesdecades,havedone things more or less the same way. In the case of financial advice, an adviser may check in once or twice a year with the primary
We need technology to increase transparency with client, to empower them to increase their knowledge regarding their investments and understand when to seek advice. This will also drastically improve trust levels with the industry she says.
10 BusinessDay www.businessday.co.za Thursday 15 September 2022 The experts in Specialty Risks, as voted by our brokers. iTOO Special Risks (Pty) Ltd (Reg No: 2016/281463/07) is an authorised Financial Services Provider (FSP No. 47230). Underwritten by The Hollard Insurance Company Limited (Reg. No. 1952/003004/06), a Licensed Non-Life Insurer and an authorised Financial Services Provider. www.itoo.co.za INSIGHTS: FIA INTERMEDIARY EXPERIENCE AWARDS 2022
PEACE OF MIND
It’s not only paying claims that matters; clients need to know that they have sufficient and appropriate cover for their unique and individual needs and this is only possible through the partnership of the people who advise them our intermediaries, says Muller.
Santam expects to rely on its intermediary partners more than ever in the future, particularly as they go beyond being brokers to becoming risk advisers. This means, he says,
Brokers ‘play pivotal role’
T
The incrementally successful intermediaries, adds Coutts, are likely to be those who still provide leading advice and tailored customer solutions, while also leveraging the marketing reach, service efficiency and client flexibility that digital solutions enable.
Naylor says the changing risk landscape means conventional insurance covers alone are no longer relevant.
Product supplier of the year: Non-Life Personal Lines. (L-R) Barry Taylor, FIA chair: Non-Life Exco; Quinten Matthew from Santam; and Butsi Tladi, FIA president.
exceptionally valued in our business and we recognise that without them, we would not be where we are today.
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Advice, she adds, is a cornerstone of enabling clients to be properly covered.
Senior faculty member and strategist at the Gordon Institute of Business Science (GIBS) Abdullah Verachia says: The fuel of the future is in the superpowers of skills that can t be digitised.” Routine functions and repetitive actions, he says, can be digitised, but not those skills that are uniquely human such as curiosity, innovation and relationshipmaintainingwhileclientscommunicatebetweenhavebusinessesSuccessfulexperimentation.intermediarywillbethosewhichfoundthebalanceusingtechnologytoandengagewithtoimproveefficiency,atthesametimeapersonalwithclients.
As the needs of client’ s changes, the expert advice of an experienced intermediary is essential to advise them about which risk to insure.
ofsuitableneedsmatchidentifyIntermediariesandthenclientwithproductferings
Hollard Insure, the Corporate Insurer of the Year, first runnerup in the Personal Lines category and second runner-up in the Commercial Insurer of the Year category at the 2022 FIA Intermediary Experience AwardsToday, more than ever, the intermediary plays a pivotal role in the insurance equation, he says. “The current insurance environment is characterised by rises in reinsurance rates and lower risk appetite for certain classes of insurancematchthebringBrokersinsurance.orintermediariesexpertadvicetoidentifyneedsoftheclientandthesewithasuitableproduct.Notonlyaretheyrequiredtonavigatelargepremiumincreasesbutalsomorepolicyexclusionsthaneverbeforeinbringingsolutionstocustomers,headds.Asrisksforbothindividualsandbusinessesincreaseexponentially,clientsneedtoproactivelypreventriskasmuchastheyneedsolutionstotransferit,saysAndrewCoutts,executiveheadofIntermediatedBusinessatSantam,thePersonalLinesInsureroftheYearatthisyearsawards.
Around the world there is a ransomware attack every 11 seconds. SA has the thirdhighest rate of cyberattacks in the world. The number of kidnappings in this country per year has doubled since 2010.
Businesses prepare for a changing risk landscape
She technologyrecommendsenablerssuch as robo-advice to do the easy lifting Advisers need to automate as much as possible but without losing the personal singleservicerelevantRobo-advisersrelationship.becomemorewhenprovidingabasictoclientswhohaveaneedandcan ’t afford a financial planner.
The key to managing an intermediary practice in the future, she adds, is to offer these types of platforms internally, while allowing the adviser to
maintain a relationship with the client while they build a portfolio and leaving the door open for future engagements.
According to the SA crime statistics released last month, commercial crime is at its worst level in five years. In the corporate space there are about 120 different pieces of legislation directors of a South African company have to face. A failure to comply with these could lead to legal action against directors in their personal capacity. All of these risks need to be covered.
Going forward, advisers need to transition their business from product selling to lifecentred financial planning. They will need to add value to the point where they are not competing against an online tool or a calculator. Ultimately, clients need advisers to assist with the complexities and details of financial planning beyond what can be found online.”
In this environment, foresight and a future-oriented awareness will allow businesses to quickly respond to future market threats and opportunities, maintains FIA CEO Lizelle van der Merwe.
FUTURE CLIENTS HAVE GROWN UP WITH THE INTERNET AND ARE OPTOTHISENGAGINGCOMFORTABLEDIGITALLY.OPENSTHEDOORGLOBALPORTUNITIES
Embracing technology in financial planning will help to bring down the cost to make financial advice more accessible to the lower income market.
ensuring insurance becomes a holistic solution to manage risk.
CHANGING LANDSCAPE
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Intermediaries are perfectly positioned to become risk advisers and help make the cost of insurance sustainable, while also creating true peace of mind for clients, adds Coutts.
Product supplier of the year: Non-Life Corporate. (L-R) Butsi Tladi, FIA president; Dianne White and Nash Omar from Hollard Insure; and Barry Taylor, FIA chair: Non-Life Exco.
What sets advisory businesses apart and what has sustained many businesses over the past decade are client and partner relationships.
What is clear, however, is that markets will continue to be volatile and businesses need to expect the unexpected.
Given that environmental risks are perceived as critical long-term threats globally, advisers need to incorporate environmental, social and governance (ESG) investment strategies into their advice process she says. At the same time they need to factor in the growing risk of cyber threats, particularly given the growing dependency on digital systems.
Justin Naylor, MD of iTOO Special Risks, the winner of the Underwriting Management Agency category, points out that the risks both individuals and businesses face today are changing. In SA, Covid-19, unprecedented riots and the floods that occurred in KwaZulu-Natal earlier this year are some public examples of a changing risk landscape where South Africans have faced a series of catastrophe events like never before.
He says for intermediaries to remain relevant they need to have a real understanding of risk and the ability to tailor suitable solutions for client needs. Client-centricity will be core. It s imperative that intermediaries are armed with the tools and knowledge to know what clients need both now and in the future.”
In the insurance industry in particular, claims advocacy remains key given that a high touch is required at the point when a client needs you most in the event of a claim.
Health insurance solutions are able to unlock access to quality affordable health care to segments of our population who otherwise would not be able to afford cover through traditional medical schemes,” he says.
McHugh says that having one of the youngest average member age profiles provides Momentum Medical Scheme with a stronger longer-term outlook when compared to many of its competitors, while also allowing for lower annual contribution increases.
FIA
Product supplier of the year: Medical Schemes. (L-R) Butsi Tladi, FIA president; Leo Dlamini from Bestmed; and Greg Setzkorn, FIA chair: Healthcare Exco and Financial Planning.
ntermediaries play a critically important role in the medical scheme industry, advising clients on the right medical aid provider and the most appropriate option for their needs and budget.
transparency and a better understanding of policy details.
YEAR
The benefits for advisersare significant, ensuring scalability, cost management and assisting with client acquisition.
Justin Naylor, MD of iTOO Special Risks, says to keep up with the pace of change, intermediaries need to be well versed in numerous new areas of specialty insurance.
Those who fail to innovate won t be able to scale up their businesses, compete with direct players or survive.
A wide choice of available medical aid options can make it difficult for advisers to decide on
All of these factors do mean advisers need to be ready to demonstrate to their clients how they deliver value, he says.
Digital platforms allow insurers to engage with and even sell directly to customers, potentially intermediariescuttingout of the loop. This begs the question of whether the risk disintermediationofis real.
Sean Hanlon, executive director for sales and distribution at Brightrock, agrees that there will continue to be a role for intermediaries in the digital era. Studies indicate that clients are more likely than ever to seek out face-to-face advice from a qualified financial adviser and that clients with an adviser have a greater sense of wellbeing. While people value the convenience of technology and accessing information digitally, it sclear people still trust people when it comes to understanding financial advice.
Industry experts say that going direct is not always the cheapest option either immediately or in the long term and that having a broker can, in fact, save a customer money. Consumers, more informed
Bestmed has dedicated business consultants to assist advisers. In addition to providing training, the business consultants are also responsible for onboarding employer groups and assisting with urgent administeredBestmedinquiries.isaself-scheme which means we handle all of our administration internally. This gives our business consultants access to the right people to take care of urgent authorisations or claims, says Dlamini.
WINNER: PRODUCT PROVIDER OF THE FOR EMPLOYEE BENEFITS
Costs and technology among challenges facing insurers
In the medical schemes category of the FIA Awards, Bestmed took top honours with Momentum Medical Scheme as first runner-up and Discovery as second runner-up.
“Although it s a personal choice as to whether or not members use an intermediary, we do encourage them to reach out to advisers, particularly as there is no additional charge for this service, says Dlamini.
Intermediaries have traditionally played a central role linking product suppliers to customers. But, despite playing a critically important role in the insurance value chain, they face a growing number of challenges including demonstrating their value, and remaining abreast of complex compliance and regulatory demands and rapid technological advancements.
This changing landscape requires intermediaries who have a good understanding of what is a highly complex and regulated industry, who understand the potential emerging risks facing their clients and who can translate the fine print to ensure more
Given the need for instant gratification, he believes frontend digitalisation will become more relevant. Clients want to transact in their own time on simple tasks which digitalisation allows them to do.
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Medical schemes are having to factor in a potential increase in new viruses and possible future global pandemics. Also, global socioeconomic pressure related to the general cost of living has further highlighted the need for more affordable health care cover Intermediariessolutions.operating in the health care space are faced with the fact that medical aid is increasingly being seen as a grudge purchase. “The current economic climate is making it difficult to sell medical aid due to affordability. This is where an intermediary s experience and
Andrew Coutts, executive head of Intermediated Business at Santam, doesn t believe it is. The pandemic brought a flash of change and complexity that was not an anomaly but part of a larger global trend. Risks are on the rise: shifting weather patterns are catalysing extreme flooding or drought; there is deteriorating water and power infrastructure; and increasing instances of cybercrime, to name but a few.
Members of medical schemes want the peace of mind that they have cover when they need it, points out McHugh.
Experienced and knowledgeable advisers help guide members’ choices
Consumers place significant value on a medical scheme that can show a sound financial track record and good solvency levels. The second biggest consideration that is then applied is affordability of cover.
Intermediaries need to shift towards becoming proactive risk advisers, exploring likely future scenarios for clients and then advising them on relevant, nuanced insurance offerings accordingly, says Coutts.
That need for specialist knowledge is likely to result in advisers starting to specialise in particular industry segments, predicts Jurgen Hellweg, CEO of Western National, the Product Supplier of the Year in the NonLife Commercial category.
BusinessDay11 www.businessday.co.za Thursday 15 September 2022
A healthcare adviser with a wealth of experience, flexible solutions and up to date knowledge on the latest offerings from leading medical schemes can make all the difference in finding appropriate cover in terms of an individual or a family s needs and what they can afford, explains Damian McHugh, executive at Momentum Health Solutions.
He says Momentum Medical Scheme s entry level option, Ingwe, continues to grow.
expertise comes into play as they are able to do a needs analysis and, taking the client’ s budget into account, make a recommendation on a suitable plan, explains Dlamini.
than ever, are increasingly likely to question financial advisers more closely around product options and costs. In the current economic environment, where pockets are under pressure, clients are likely to shop around for the best value for money, says Hanlon, adding that with changes to the regulatory landscape over the past decade, there is increased consumer awareness of how intermediated models work and how remuneration is structured.
It s important that medical schemes continue to refine their benefit offerings to ensure they appeal to young, active individuals and families who contribute to the long-term sustainability of schemes.”
Appropriate cover for when it’s needed
Principal officer at Bestmed Leo Dlamini agrees, adding that a good intermediary is also able to advise members on how to maximise their benefits, provide additional information on chronic conditions and other diseases and can even assist with claims management and dispute resolution.
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a suitable option for their clients.
Momentum Health Solutions, says McHugh, is a leader in this segment, offering flexible cover appropriate to all employees.
Momentum is part of Momentum Metropolitan Life Limited, an authorised financial services and registered credit provider. BRAVE/8615/MOM/E We’re delighted to be the winner of the 2022 FIA Product Provider of the Year: Employee Benefits Category. Thank you to our clients and our intermediary partners. Let’s keep walking the journey to success. #SuccessForYourPeople INSIGHTS: FIA INTERMEDIARY EXPERIENCE AWARDS 2022
Deloitte s Africa Insurance Outlook 2022 points out that not only are customers demanding greater digitisation and process automation, but they are also wanting more flexibility in product offerings and terms, and more individual risk profiling and pricing.
There samisperception that intermediated insurance is more expensive and going direct saves clients money.
Product supplier of the year: Non-Life Commercial. (L-R) Butsi Tladi, FIA president; Estelle Smit from Western National; and Barry Taylor, FIA chair: Non-Life Exco.
Product supplier of the year: Employee Benefits. (L-R) Butsi Tladi, FIA president; Gaileen Eaton from Momentum Corporate; and Zahir Anter, FIA chair: Employee Benefits Exco.
A hybrid model is likely to emerge, believes Hanlon, where some interactions take place virtually, but where there is still contact between a client and a human financial adviser.
It s increasingly likely that clients will commissionquestionarrangements or request to pay a fee-for-service.
BrightRock, the second runner-up in the Long Term Life Insurer category, has created its needs-matched life insurance with exactly this co-creative model in mind. An online quoting platform has been designed with a client-friendly digital interface that enables a financial adviser to sit together with their client to capture their financial needs and create a proposed life insurance solution real-time, with direct input from theAnotherclient. challenge affecting financial advisers is the question of Consumers,affordability.morethanever, are concerned about how to stretch their hard-earned rands.