The past few years of growth have created an interesting market in Latin America – so what can we expect?
The last few years have seen something of a breakthrough in Latin American insurance market. The combination of deregulation and a favourable macroeconomic climate has created a positive environment for growth – and a good deal of opportunity for insurers. Life insurance premiums in Latin America grew by around 17% in 2012, becoming the fastest growing region worldwide. As for the Non-life insurance, the growth was between 8%-9% situating the region as the second fastest growing region.
With people actively seeking insurance, the key trend among companies is probably innovation. We’re seeing this in a number of ways. Customers are becoming more demanding as their satisfaction becomes a driver for which provider they choose. To cater for that and to make the most of the economic environment, companies need to be able to develop and roll-out products quickly. It’s important to note though, that to do this, companies also need to increase efficiency through the deployment of “state of the art” application platforms.
The other main driver is that companies are realizing that, now more than ever, dealing with customers is more of a personal service than it is a financial transaction. This changes the way they have to deal with their customers. It’s not enough to merely offer low premiums. And while a company’s aim should always be to pay as fast as possible, it still needs to protect itself from fraud. The middle line, the compromise, is key: any new framework still needs to be able to handle fraud detection in real time.
The growing importance of big data is beginning to make itself felt. One big challenge is for companies to understand customer behavior and use it to identify further needs and opportunities. Predictive analytics are a great help here. Also, many countries are facing natural catastrophes, they need to gather and manage data to see how these things will affect behavior too. So behind both those challenges is the simple act of gathering and managing large amounts of data.
It’s an exciting region that has millions of potential customers without insurance, without even computers. But one thing that everyone can have is a personal relationship. Companies – or their agents – can still approach people directly. This sales person needs to be empowered though through technology so that they can offer a real time quote. This means that there’s a need not so much for technology on policy-holder side, but on the sales force side, empowering its teams to make face-to-face relationships and convert them into sales. The simple requirement is mobility and accessibility; information on a tablet or smart phone that they can process right there and then, while they’re making their sale.
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