Culture and distribution are the primary challenges for successful insurance innovation in Latin America, according to a panel discussion held today.
Products themselves were less of a barriers to innovation, according to the innovation panel, part of Reactions’ 5th annual Latin American Insurance and Reinsurance Forum.
“There’s a new world of opportunity for the insurance business,” said Juana Llano, vice president, insurance, Suramericana.
“We need to move forward, but it’s not so much a question of technology, but more of understanding the customer,” she said.
Technology can act as an enabler, she suggested, but not as a substitute for sound strategy.
“We all recognise the importance of technology and digitisation, but knowledge of the customer - less so,” added Llano.
Citing Peru’s market, Jose Torres Llosa, executive vice president, IT and operations, RIMAC Seguros, noted a “lack of insurance culture” which still pervades the region.
Brokers have been unenthusiastic to serve personal lines, he noted, as costly and inefficient.
Antonio Cassio, Americas regional officer, Generali, noted that micro-insurance opportunities are not being exploited to the full.
“There are a lot of channels available to use, but insurers are not using them,” he said.
He suggested mobile technology and utilities billing as a means of payment represent “huge opportunities” to access a broader client base.
Llosa cited the traditional crowdfunding, within the family and neighbourhood, by which low-income households deal with crises such as sudden health insurance costs.
“The mechanism exists in the culture to do this,” he said.
Telematics is taking off, with RIMAC “close to launching a product”, he suggested.
“People may say you’re cannibalising your market. But that’s crazy, because if you don’t, somebody else is going to come in as a disruptor and do it anyway,” he added.