While Robinson thinks that as the major life companies pull out of less-regulated markets, portable savings products will become harder to acquire. “It will also be harder for expats living in them to get ongoing servicing advice,” he says.
“There is a danger of ‘churning’ into other plans if there are a couple of providers that are still willing to take the chance and operate in the grey market.”
Digital drive
“There is also the likelihood that more providers will start to look at direct, web-based sales, especially in the protection arena, which tends to be a bit more commoditised,” Robinson adds.
ITA’s Story says clients are looking more and more online for services. “If you are providing insurance products and investment products you have to be online.
“You have to be doing things digitally nowadays and following all the way through with that from the front end, the processing of the applications, to the back end and the servicing. You can’t have huge teams of administrators anymore, it is just not efficient.”
Growing demand for life protection products, especially in underdeveloped markets like the Middle East, was a key trend identified by Walter Jopp, head of market management, Middle East and Africa at Zurich.
Jopp says Zurich is the only insurance provider in the market to publish claims statistics specific to the Middle East, which reveal that heart attacks, cancer and road traffic accidents account for 85% of all claims.
“The basics have not changed. Customers still need protection, they still need to save for their retirement and they still need to carry on protecting their loved ones.
“We are doing everything we can to make customers aware of those needs and the fact they should protect themselves,” he says.
Seeking solutions
The potential growth of the life Insurance segment in the UAE was a key driver behind French insurer Axa’s decision in March to launch Axa Green Crescent, which will provide life protection, health, property and casualty products along with savings solutions to the UAE, while also functioning as a regional hub of expertise for Axa in the Gulf.
“Axa Green Crescent will enable us to benefit from an untapped market segment in the UAE and to further diversify our exposure to the fast-growing Gulf insurance market,” says Mishal Kanoo, Axa Green Crescent’s vice-chairman.
Yet fierce competition in the UAE insurance sector has put pressure on many players in this market, pushing some of the listed insurers in the UAE into the red last year after most had posted profits in 2014.
ITA’s Story says clients often do not know what they need to do to prepare for their retirement, while at the same time market volatility is putting many people off from saving for retirement.
He says: “The market is changing and client’s needs are changing, too. You need to be able to adapt and evolve, and offer things that are different to what is out there today. Our solution is a guaranteed product that tracks the S&P 500 index, which everyone understands, and then we have outsourced the guarantee to the global banks.”
