INSURANCE IN THE PREVAILING ECONOMIC CONDITIONS

During any unfavorable economic and working conditions, insurers and generally other business entities will have to come up with innovative, cost effective and long term solutions to ensure that they not only survive such moments but also prosper, as they are bound to happen in the normal business cycle as it is currently as a result of the uncertain state of the country's political and economic climate.

The major challenge with the insurance industry is that the players normally react to a situation rather than anticipate on what might go wrong and plan for any eventuality this can be termed as "after an event has occurred" reflex reaction, this is best illustrated by cases where the regulator come up with rules and regulations to streamline the industry players normally rush to comply with the requirements without doing proper analysis and feasibility studies on how best to implement the changes. The end result being compliance but in a very haphazard manner as there is normally limited time to properly formulate individualize and incorporate the changes in their already existing organizational structures this approach of "one size fits all" is detrimental to all parties as no two organizations can have completely identical challenges despite their operating within the same market.

A complete culture change and overall overhaul of the current systems would ensure that the market moves to the next level in terms of penetration profitability and general adaptability a good place to start would be to ensure that there is a level playing field for all players by eliminating factors such as extreme undercutting which in most cases forces most of the smaller players to take on very risky classes of insurance at very low rates which they always end up paying dearly for as they mostly lack other investments and ventures that their stronger competitors have this can have serious liquidity problems when the claims start pouring in forcing them to pay out of pocket. With undercutting eliminated players would be left to compete on areas such as turnaround times, customer service and overall service delivery which would ensure that there is a general improvement in the product being offered by all as one will be able to comfortably deal with their claims as the business in their books would be manageable and not overly risky.

An area with great potential for growth is the micro insurance segment of the market although this has been targeted by several players, the only challenge has been the approach taken by all who have ventured into this area. A case in point would be insurance for electronic devices such as telephones (mobile phones) the notion that just issuing brochures to the public and television advertisements although good will not have the desired impact since even if the advertisements have all the required steps for you to get the product/service the personalized touch is still very vital. Customer service is also very important in the insurance industry this is especially in the front office of any organization, as a front office member of staff you have a very important role as the face of the company in that how you treat that walk in client has a direct impact on whether you will get that business or not. With most organization the front office is normally assigned to the least qualified and least motivated person as most of the other staff view it as a "lowly job" this proves very detrimental as such roles always inevitably end up with the least professional staff who will already have formed a mentality that the duty has been assigned to them due to their limited qualifications with the end result being that the clients will be out-rightly mistreated and most of the prospective business being lost and the company name being tarnished. To avoid such situations companies should ensure that their front offices have the most qualified and professional personnel as the face of the company so as to ensure that the best possible service is offered from the onset. This is a very rudimentary approach to solving the challenge of improving an organizations public image but which may may have a very positive impact to an organizations growth and development.

Charles Tanu Githinji

November 2017