Article Synopsis :
What is good for insurance isn’t usually good news for the individuals who are purchasing it. And so this is the case in emerging Asia, according to research by Dr. Schanz, Alms & Company.
Opportunities arise from a lack of cover
The effect of increasing pollution, changing lifestyles and ageing are leading to higher incidents of cancer, diabetes and cardiovascular diseases.
Most of these risks are uncovered as there is a sizeable life & health protection gap in the region. But this is also the reason for a buoyant outlook for risk protection products that will mitigate exposure to these critical diseases.
Digitalisation is the key to better admin…
The key to servicing this market is of course, digitalisation, says the paper. Not only does it make distribution and administration more effective, but it will allow tailored solutions to be launched that meet individual needs.
The research shows that there is a shift from savings oriented to protection products, which already represents a US$450 billion life insurance market place.
As in the MENA research (MENA Insurance Pulse 2018), the vast majority (86%) of executives interviewed, believe that growth of life and health insurance premiums will outstrip GDP growth.
…and premium growth
The fastest growing product lines are already fixed benefit health products against non-communicable and critical diseases.
Deploying digital technologies and advanced analytics will increase premium growth by improving the connection to segments of the population that are currently underserved, greatly enhancing the appeal of products and reducing transaction costs.
Growing awareness drives demand
Direct online sales will grow rapidly, though from a low base, as simpler term life and personal accident products are made available.
Term and whole life insurance are most profitable, while margins on health insurance products offering fixed benefits for critical illnesses, cancer, diabetes or in the form of hospital cash remain attractive.
Demand for these products has increased in recent years as awareness of the products and disposable incomes have both increased.
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Digital Insurer's CommentsDespite geopolitical shadows being cast across most of the world’s markets – or perhaps in spite of it – the future looks bright for life cover in emerging Asian markets.
There is clearly a need for protection against these growing risks – some of which are self-inflicted – others a product of the environment, or the blessing of longer life.
Awareness has grown and people are willing to commit their cash, particularly as this has become more plentiful in recent years.
The key to unlocking this market is, of course, digitalisation. The sooner it comes, the sooner insurers will be able to satisfy more policyholders with more tailored products while controlling costs.
It’s another win/win for insurtech, its clients and consumers.
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