Over time, the role of Brokers and Agents within the insurance industry is proving to be an increasing necessity as part of the insurance value chain. The need for sound financial advisory is indispensable in helping Batswana secure their financial future; in addition to the insurance provider itself, Brokers and Agents are a key part of this ecosystem.
Life insurance distribution continues to change, and with this comes a growing need to educate and empower customers by unpacking this particular field in the insurance sector. With the changing times comes fresh faces, bringing in welcomed developments into the industry.
New Brokers and Agents continue to enter the market and are involved facilitating continuous change within the industry. Therefore, what can we expect from the future generations of financial advisors in this space? What does this mean for the industry as a whole, and more importantly, what does this mean for clients investing in life insurance products?
Life insurance distribution is a go-to market function and is the discipline responsible for delivering financial and insurance solutions to the public. Within this function, Brokers and Agents are responsible for fulfilling the role as financial advisors to the public. The role not only seeks to close the life insurance needs gap, but also extends into to providing invaluable access to resources such as financial literacy, financial inclusion, and fiduciary services through the financial needs analysis exercise. This exercise is an imperative component in planning for one’s financial journey. It is a comprehensive assessment done by a qualified and trained advisor in holistically assessing one’s financial standing in order to map out a way forward. Financial advisory is a much-needed service to ensure comprehensive planning, from an objective and well-trained third party
. This is an expanding and ever-evolving industry in Botswana and the rest of Africa. The efforts currently being made in professionalising the discipline is allowing for more relevant qualified financial advisory to be established as well allowing for the growth of individuals who choose to participate in this industry. The number of life insurance qualifications with local tertiary institutions is experiencing an increase in uptake, and we can therefore expect to see an industry that will soon be dominated by a diverse array of qualified life insurance distribution professionals.
For the oncoming fleet of financial advisors, there exists huge opportunities for a total disruption in the way business is being done, thus contributing to greater progress in the field. There are numerous opportunities to change and evolve insurance-based advisory for business in Botswana, such as finding innovative and sustainable ways to ensure financial inclusion and grow financial literacy throughout all demographics in Botswana. Many have had to streamline their business practice, offering the opportunity for them to re-evaluate their financial positioning with their partnered advisors.
The services offered in the life insurance distribution space are about offering a promise and with that comes a huge responsibility of continually delivering and being accountable. This requires an industry that is united and cognisant of the need to ensure trust in the market. A number of factors like transparency, life insurance literacy, and solution accessibility play a very important role in the uptake. These speak to a need for a more collaborative effort to have these addressed. Partnering with institutions such as the Association of Life Underwriters Botswana (ALUB) and the Insurance Institute of Botswana (IIB) is another way the insurance industry is shifting to ensure the highest needs of professionalisation are met because these offer support and alignment between life insurance providers across the market.
These are exciting times for the industry in Botswana, Africa and the rest of the world. The arrival of different players has re-energised the whole industry for the benefit of the client and the market at large, breeding competition that encourages best practice, innovation, and competitive pricing. Regulation changes have also been on observed and one must admit there was a need for these changes to accommodate industry developments.
The COVID-19 impact on this industry cannot be ignored. The pandemic has caused the industry to re-strategise its business practices and think of contemporary ways of being clientcentric while adhering to health and safety protocols. Therefore, there has been a huge leap in the last few months with regard to the digitisation of some of our traditionally manual processes and this is definitely going to continue beyond this period of time.
The pandemic has also, coincidentally, created a closer relationship between the client and advisor. Clients are more inclined to reach out to their advisors in appreciation of the need to learn more about what they had cover for and the implications of both COVID-19 on their finances and how their insurance provider can help.
We will definitely see more leaner and responsive models like the move towards digitation of certain services. The market should brace itself for huge changes as it is clear the client’s voice needs to be prioritised when planning how we model our distribution channels. Our traditional business models that have proven to be of great value to the client will continue to exist, albeit with the added benefit of professionalised Brokers and Agents.
The insurance industry is going through a huge transformation to accommodate a modern-day customer with more knowledge and higher expectations. The customer has been speaking for a while and it is good to note that the service providers have started listening to this voice. This transformation will definitely lead to some casualties for those who are not up to the task. Financial advisors are quickly adapting to the industry with the foundation and values of clientcentricity behind everything that is done. Truly, it is an exciting time to witness the new faces of Brokers and Agents develop an industry that is on par with the growing financial literacy and expectations of its clients.