Why insurance sales agents will not be exiting the stage soon

Insure Afrika Founder and CEO Gagan Hayer and Resolution Insurance managing director Alice Mwai during the signing of a partnership between Insure Afrika and Resolution Insurance, for the product Next Taxi Insurance. FILE PHOTO | NMG 

By JAMES NGUNJIRI

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Summary

• Underwriters through their umbrella body, Association of Kenya Insurers (AKI) have said the team is a critical element in the business as they contribute towards an estimated 40 per cent of premiums.
• And in as much as technology will be an enabler of convenient service, not all insurance products can be sold from end to end including claims processing online.
• Some products such as medical insurance still require human contact. Given this, the role of the insurance sales agent will still be necessary.

Insurance companies are set to increase the number of sales agents and equip them with the right skills to navigate the ever-changing market.

Underwriters through their umbrella body, Association of Kenya Insurers (AKI) have said the team is a critical element in the business as they contribute towards an estimated 40 per cent of premiums.

And in as much as technology will be an enabler of convenient service, not all insurance products can be sold from end to end including claims processing online.

Some products such as medical insurance still require human contact. Given this, the role of the insurance sales agent will still be necessary.

“They are the interface between the insurance companies and the general public to whom they offer “last mile” service especially where personalised service is necessary,” said AKI board chairman Patrick Tumbo last week in Nairobi.

Official data shows that insurance penetration in Kenya is currently below three per cent, and industry players’ goal is to grow this to six per cent in line with the global average.

“This we shall achieve by maximising on the opportunities that the changing environment is providing us with,” said Mr Tumbo during AKI Agents of the Year Awards.

There are about 6,500 insurance reps in Kenyan, and these numbers are negligible compared to over 40,000 banking agents and over 135,000 mobile money outlets which have increased penetration levels to over 70 per cent.

“There is, therefore, need to increase our insurance agents to ensure that we reach and serve as many Kenyans as possible,” said Mr Tumbo.

Already, a number of insurance companies have started retraining and coming up with digital products that will assist both agents and customers to conduct their businesses.

Last month, Jubilee Insurance launched two apps for their agents: JubiAgent Medical and JubiAgent Motor Apps to enable their agents to self-serve clients on their mobile phones. The apps will eliminate the need to customers to walk into the offices or make a phone call to access services, but can complete their requests, renewals and transactions through the app.

Agent apps will enable them to access the premium calculator, agent account management, pre-insurance inspection and renewal on the go, making them more effective and efficient when interacting with clients and potential clients.

“Customers are now looking for services that can be initiated and completed on their mobile phones. They want services that take less time to process and insurance providers who tap into this efficiency and meet this expectation will retain and attract new customers,” said Jubilee Insurance Regional Chief Executive Julius Kipng’etich.

CIC Insurance Chief Executive Tom Gitogo said technology for now will remain a channel of distribution, not a replacement.

“We still need foot soldiers (sales agents),” said Mr Gitogo.

He said sales agents need to be digitally savvy adding they are already training theirs. “We have already started, but a lot of it is depending on environment we are working in. We have to move in tandem with the customer,” said Mr Gitogo.

CIC Insurance has about 600 sales agents and the number is expected to increase to about 1,000 by end of the year.

Bima Intermediaries Association of Kenya (BIAK), a body that represents the interests of insurance sales agents in the industry said despite digital adoption, agents are still needed.

Association chairman Washington Ndegea in a recent comment said as all sorts of ways to improve insurance penetration are being sort, with digital products now entering the market, insurance agents must be taken care.

“But even as they endeavour to do so, let’s not forget, not taking care of the insurance agents in the industry means most of these attempts will fall flat on their faces because every would-be consumer of an insurance product will need some explaining to be done to them before they can buy it. That’s where the agents come in. In Africa, insurance is not bought but sold,” said Mr Ndegea.