Rehan Writes – Instaful

What insurance can learn from milkshakes?

I am a fan of Clayton Christensen’s work and it’s no secret that I take inspiration from his and his coauthors’ books in my effort of making insurance easy, affordable, available and accessible for non-consumers.
While rereading his work “Competing Against Luck” and the brilliantly explained Jobs Theory, I could not resist drawing parallels between the insurance in emerging markets and why it is not sought after as much as other consumer products.

Less than 3% Vehicles are Insured in Pakistan

A recent report from the SECP revealed that under 3 percent of the total vehicles registered in Pakistan are insured. Low hashtag#insurancepenetration is often cited as an outcome of some insurers using tricks to delay or deny claims but this is part truth. Other processes even paying premium are at times so “friction-ful” that they turn off potential buyers and drive them to the competition i.e. no-insurance.

Claim is the ‘moment of truth’

“Customers with insurance do not claim all the time, but when they do, their insurance must respond; otherwise, they will stop buying.”
Claim is the ‘moment of truth’ in insurance, and this cannot be articulated better than how Ammara Batool has described above during our recent conversation.

Using Behavioral Science in Marketing

Global Shield was launched in Nov 2022 with an objective to increase the resilience of vulnerable populations in the Global South against climate risks and consequently help to avert, minimize and address losses and damages of climate change. Last week marked a significant milestone as Pakistan became the first Asian…

Future of digital insurance

A few months ago, a friend and senior insurance industry professional remarked that hashtag#digitalinsurance in markets like hashtag#Pakistan is a futile exercise and nothing more than a buzzword. He insisted that insurance here would continue to be conducted in the same manner it has been for decades. I couldn’t disagree more, obviously! 🙂

Processes drive fair selling

So the story goes like this: A poor person who had diligently saved money over a long period visited their bank to deposit the sum and came out having bought an annual premium hashtag#insurance policy. After realizing the situation, the client approached different quarters and with an effort spanning over several years, was refunded the money with mark-up. We know that this is not an isolated incident and there will be more cases with similar details.

A case for inclusive insurance

With changing dynamics around the world marked with the rise of FinTechs, payment and lending platforms and Covid-driven fast-tracked growth in awareness and usage of financial products and digital processes, the stage is set for insurance to be offered to the previously excluded segments of society. Taking Pakistan for example, although financial products have registered meaningful growth over the past few years, insurance, commonly regarded as the ugly duckling of financial products, still remains at the nascent stage with insurance premiums only 0.8 per cent of GDP. There is a solid case for players to invest in inclusive insurance and reach out to tens of millions of ‘financially included’ Pakistanis and not only provide them with a safety net but also create a viable insurance business worth billions of rupees of gross written premium.

The conundrum of reaching first-time buyers

Insurtech and digital insurance have become buzzwords these days and that is all for good reasons. But in the context of emerging and frontier markets, digital insurance has more to do with market-creating innovation than disruption which is normally the case with Western or developed markets with deeper insurance penetration.

Busting insurance myths

A lot has been said about low insurance penetration in Pakistan and many professionals fear that it may further deteriorate in the face of rising inflation and ongoing economic challenges.Average Pakistanis, whose earnings are roughly $4 to $30 per day, are mostly excluded from insurance, even though they are often the primary target, especially of digital insurance. While struggling to put food on that table amidst historically high inflation rates, these people find it hard to spare money to purchase insurance products.

The ‘if’ nature of insurance

Several years ago, a colleague said that ‘no one wakes up in the morning to buy insurance’ in an attempt to explain the reasons for an ever-anaemic demand for insurance products. Over the years, this phrase has become popular among neo-insurers and those trying to change how insurance is traditionally viewed.