Article provided by Discovery Business Insurance
Anton Ossip, Discovery Insure CEO, shares his insights into how to harness the right technology to give your business the competitive edge, and to change society for the better.
Discovery is a start-up. We’ve been around for less than 30 years as a company… the Insure business for nine years. Being a relatively new company in this African landscape, we had to have a vision to do things differently in the short-term insurance world.
We were up against companies that been around for more than a hundred years. They are good competitors, whom we really respect. The South African short-term insurance marketplace is a hugely competitive space.
But, we had a vision.
- We wanted to make people safer on the roads.
- We wanted to be proactive about risk, rather than reactive and
- We wanted to create an insurance journey that our customers would enjoy and take away the frustrations that are quite synonymous with short-term insurance.
In Insure, the core vision hasn’t changed one bit. The vision was creating a nation of great drivers which feeds into the Discovery purpose of making people healthier and enhancing and protecting their lives. But the technology has changed.
So firstly technology must be for the sake of making things better, not technology for the sake of technology. We installed telematics devices in every one of our client’s vehicles. Then, we were able to develop smartphone apps that effectively did the same thing in a much more cost-effective, easier way.
The telematics story
We came across a start-up that came out of Massachusetts Institute of Technology (MIT). A small group of really smart guys who thought there was a way to accurately measure how cars were being driven using a smartphone application.
A lot of people though that that was a pipe dream. It was never going to be accurate, the phone is moving all over the place, and someone may be talking on it. How does it know what’s happening in the car, outside the car etc? It wasn’t at the point ready to be used in the consumer market or the insurance market. But our strong R&D engineering team worked together with theirs. We developed the technology in conjunction with them and, jointly patented the tech which today has become the most used telematics technology in this particular field. We gave them their seed capital, and both businesses have been a great success story. A combination of a South African start-up business with a US start-up business coming together, bringing the best of our skills and creating a global success story.
The importance for SMMEs
With the driving app, technology can measure how someone drives using a smartphone app as opposed to a heavy installation process. In the SMME world in particular, this is critical. We have implemented this successfully in the fleet space where customers can monitor how their fleets are performing, driver behaviour, giving them rewards, giving the company rewards for a better-performing fleet.
The technology allows owners to track their vehicles without spending thousands of Rands a month per vehicle on sophisticated tracking software. We have offered that using a smartphone app and quite inexpensive technology effectively to achieve that.
We try to make the journey better with tech. For many years we’ve been allowing clients to interact with us on our mobile app, transactional issues, logging a claim, making changes to a policy etc. Then, checking their Vitality Drive status, “gamifying” driving by allowing them to get their weekly rewards on a game board, if they drive well.
Long goals for sustenance
I think that resilience has helped us move along the J-curve. We also have quite a unique culture of innovation that has really been the reason for Discovery’s success, in terms of fostering new businesses from health to banking, to insurance to investments etc.
Our difference is shared-value insurance. Effectively, it is our way of incentivising and encouraging behaviour change. When behaviour changes, it ultimately reduces the frequency and severity of claims, or the number of claims and the cost of those claims that an insurance business will experience. Then we take that saving and invest it in the incentives. So, you create this virtuous circle where everyone gains.
The client gains from better behaviour — no one wants to have accidents. Through lower claims the insurance company gains and by taking those savings and giving it back to the clients, the clients are encouraged to further improve their behaviour. The other party that gains is society because society benefits by lower accidents, and lower road fatalities. South Africa so desperately needs a lower fatality rate. Indirectly it costs us 8% of GDP. It is a huge amount of money spent on road accidents plus the psychological cost of accidents.
Making shared-value and innovation work in business
There are think tanks and there are brainstorming sessions, R&D and steer committees where a lot of ideas come about. But if I actually look back, some of our greatest ideas were from a comment from a customer, a suggestion from a staff member: “What happens if we tried this?”
Every business has to have a breakthrough, that makes that industry better for the consumer, for all stakeholders that are involved. It is not static. You need to stay ahead of the curve. This is why innovation is a core discipline within the business. Innovation isn’t just a small tweak to a product. And it isn’t the job of a product development head or actuary to come up with new ideas. It is everyone’s job.
It’s from small things – how to do we make a process better, how do we communicate better to a customer, how do we develop a new product. It permeates through the business. At Discovery Insure, we are over 800 people, and a large proportion of them are thinking about innovation all the time, really.
The 15-episode The Healthy Business Show is brought to you by Discovery Business Insurance. Listen to the full podcast episode, ‘Insights: Innovation and technology’ with Anton Ossip.