First Quarter 2018

Our Products:

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Training on Reinsurance related and general insurance practices

EDITOR IN CHIEF

ESTHER MUHINDI

CONTRIBUTING WRITERS

ESTHER MUHINDI

JANE OTIENO

HARRY MUGO

NICHOLAS MUSAO

LEVITES RE-NEWS IS PUBLISHED

BY :

Levites International Reinsurance Brokers

Ltd. Chiromo Court, Chiromo Road,

Westlands, P. O. Box 694 - 00517, Nairobi,

Kenya

DESIGN AND LAYOUT

BY:

Levites International

Reinsurance Brokers

Welcome to our First 2018

We wish you a happy reading!

The Law of the Lid and OrganizationalGrowth

EDITORIAL

Esther Ngunyi - Muhindi

How Artificial Intelligence will affect Insurance

The 42nd FANAF General Assembly

Why Insurance Sales Agents Will Not BeExiting The Stage Soon.

Inside this issue

In February 2018 the FANAF conference was held in Kigali, Rwanda where more than 800 delegates met and discussed the vast growth opportunities in the African insurance markets.

The East African insurance industry is under pressure to embrace Artificial Intelligence so as to be in tandem with the other financial market players in the region. This will have tremendous effect on the operations of insurance companies and may lead to loss of jobs but will enhance customer service

Indeed some underwriters have installed interactive applications to enhance marketing activities using Chatbots

Leadership affects growth and profitability of

good leaders and what it takes to move organizations to the next level.

Our dear Readers,

Newsletter-Edition. We would wish to thank

you our readers for your feedback and contributions.

organizations. In this edition we look at the qualities of

Artificial Intelligence and Insurance

In the first quarter of 2018 Jubilee Insurance

launched JubiCare and JubiAgent, the apps

that allow self-service using smartphones.

Chatbots

Artificial Intelligence (AI) has enabled computer software to exhibit human-like

behaviors that include planning, learning

and solving problems for example the case

of chatbots

Chatbots work through messaging apps many customers already have on their

phones, which makes them a natural next

step in customer interaction. In order to truly

be effective, chatbots must have natural

language processing and sentiment analysis

so they can understand what customers are

really asking. Effective chatbots can process

concerns that are either typed or spoken from customers and provide personalized service.

T he insurance industry is one of the

least innovative areas for customer

However, things are definitely changing, and artificial intelligence is playing a large

role. The fast-growing technology has the

potential to disrupt the entire industry and

greatly improve the insurance customer

experience.

The industry is definitely ripe for AI disruption. Customers expect to be able to

interact with companies through modern

technology

In the insurance space, chatbots can be used to answer basic questions and resolve

claims, as well as sell products, address

leads, or make sure customers are properly

covered by their insurance In Kenya a big percent of the consumers are tech savvy and are pushing for computer-

generated insurance transactions Jubilee Insurance has integrated Artificial Intelligence into their Facebook Page

through the use of a Chabot called Julie, its

Live Intelligent Expert who answers queries.

This means faster and efficient service

delivery

Indeed in the East African insurance industry some underwriters are already

using artificial intelligence to some degree,

and the number of companies following in

their footsteps is sure to increase

dramatically over the coming years.

Artificial Intelligence has never been less

expensive or more accessible, which means

most companies don’t have a reason not to

adopt it in at least some form

Marketing

Insurance is a competitive market, so a strong marketing strategy is vital. Traditionally, insurance companies used

blanket methods like cold calling customers,

but today’s customers expect personalized

sales tactics.

However this is bound to change because AI can be applied to improve the claims

process. Claims currently are touched by

multiple employees. However, a new

process of “touchless” claims doesn’t

require any human intervention. This

process uses artificial intelligence and other

technology to report the claim, capture

damage, audit the system, and communicate

with the customer

Chatbots can pull customers’ geographic

and social data for personalized interactions

A number of underwriters have recently launched interactive applications Jubilee

JubiAgent that allows self-service using

smartphones. For example Jubilee is selling

personal line insurances through JubiAgent AI- makes the claim process faster and customized through online interfaces and

reduces fraudulent claims. It is estimated

that in 2017 medical insurance underwriters

lost more than Kshs. 1.1b to fraudulent

claims in Kenya making medical insurance

unprofitable.

Underwriting & Risk Assessment

AI can analyze data better than humans to more accurately predict each customer’s

risk, thereby providing customers with the

right amount of insurance and companies

with protection from risky customers. Research indicates that by 2020, there will be more than 20 billion devices connected to

the Internet. Insurance companies that will

strategically position themselves for this

transformation will reap big in the home,

health and car insurance sectors.

AI allows insurance carriers to price risks based on real events, in real time, using

data linked to individuals rather than

samples of data linked to groups.

AI can pull in customer data to create a full profile that can be used to offer only

relevant insurance products.

AI has also enabled these computers to solve problems and make decisions after

analyzing information. This technology

offers more advanced characteristics such as

image recognition, voice recognition and so

much more.

Artificial Intelligence in the Claims

Process

A big percentage of insurance consumers dread the process of filing a claim because the industry isn’t consistently leveraging

new technologies that are available to them.

The 42nd FANAF General Assembly, Kigali

n the first day of the 42nd

FANAF Federation of African National Insurance Companies

FANAF

General Assembly, held from 12 to 15

February 2018, speakers emphasized the

strong growth potential of the African

insurance market.

The FANAF pursues the following

objectives:

The promotion of the insurance and

reinsurance in Africa;

the establishment of the structures of

reflections and cooperation in matters

relating to insurance and reinsurance;

continuing training of staff in the

insurance sector;

According to them, the continent has

several assets, such as the high

demographic weight, the emergence of a

middle class and the low penetration

rate. To better take advantage of these

benefits, local insurers need to design

innovative products that are more

responsive to the new needs of

policyholders.

"The deployment of new information

technologies is an important growth

driver for the insurance industry," says

Adama Ndiaye, president of FANAF.

Another highlight is the agreement of the

Continental Free Trade Area, which has

been in preparation for almost 40 years,

and will be signed in March 2018 in

Kigali. This convention will open up new

Opportunities for insurers wishing to

expand their business beyond national

borders.

The Federation of African National

Insurance companies more known

under the acronym "FANAF" was

created on 17 March 1976 at

Yamoussoukro (Republic of Côte

d'Ivoire). Professional association whose

headquarters is in Dakar in Senegal, the

FANAF brings together (at the date of 15

February 2018) 214 member companies

including:

53 life companies; 137 companies Non-

life; 19 companies of reinsurance, 4

Guarantee Fund Automotive (FGA) and

1 Company Credit / guarantor operating

in the country (29):

South Africa, Algeria, Bahrain, Benin,

Burkina Faso, Burundi, Cameroon,

Central African Republic, Congo

Brazzaville, Côte d'Ivoire, Gabon,

Ghana, Guinea Conakry, Equatorial

Guinea, Kenya, Madagascar, Mali,

Mauritania, Morocco, Niger, Nigeria, the

Democratic Republic of the Congo,

Rwanda, Senegal, Sierra Leone, Tanzania, Togo, Tunisia

O

he insurance industry has recorded

minimal growth as far as penetration

and performance go. The growth has

been slower in the developing markets

where penetration has seen a sluggish

appetite.

The most sensible reason for this has been

lack of trust between the customers and the

insurance companies for starters and lack of

adequate disposable income among the

populace in many of these markets.

The last decade has, however, seen a surge

in insurance trends, thanks to the

advancement in technology. Industry experts

say that in years to come, growth of the

industry will primarily be fuelled more by

technology than by any other factor.

While the changes and growth are not

expected to be instantaneous, the winds of

change are already sweeping through the

industry, propelled by technology and

innovation.

It is expected that future insurance

companies will be driven by technology 100

per cent and all processes are expected to be

automated.

Companies that respond and adapt to this

inevitable change stand to reap big while

those that adopt a wait-and-see approach

will cheer on the first movers.

There are some technological innovations

that are expected to disrupt the industry and

how this technology can be leveraged by

insurance companies to make meaningful

impact.

Artificial intelligence (AI): AI is an

umbrella term used to refer to four different

classes of Artificial Intelligence namely

Cognitive, Data Science, Computing and

Machine Learning.

AI is expected to play a fundamental role in

helping underwriters to unlock their

potential in terms of value addition to their

back and front office operations.

Data science and machine learning, for

instance, is expected to take Centre stage in

implementing these processes because they

are the most understood and the most used

forms of AI.

The advancement in AI and machine

learning are already making it possible to

leverage unstructured datasets and

companies are already making use of this

development.

Companies are implementing AI in all their

processes ranging from product pricing to

consumer trends prediction.

They are expected to make use of

information such as credit histories and

online usage trends of clients to come up

with algorithms that would customize

products for customers.

T

tone Tech marvels that will set insurance

Block chain and Chabot’s: Block chain

technology is closely related to AI and

machine learning. Insurance distribution

channels, especially those directly related to

micro-insurance products are expected to be

modified and re-engineered to adapt to the

changing and emerging trends in

technology.

More and more companies have already

adopted the USSD approach which is

considered a low-touch approach in terms of

consumer connectivity.

While it has worked very well for most

firms, the jury is still out on the viability of

this channel as an ideal distribution channel

especially in a market where trust in the

industry is still an issue to be discussed.

Peer-To-Peer: P2P insurance describes

products such as rotating savings and credit

associations that normally group people into

pools and then offer insurance.

While this is not necessarily a new concept,

we expect to see companies leveraging on

technologies such as social media and taking

advantage of smartphone penetration to

create new group structures.

On-Demand Insurance (ODI): The current

crop of consumers has varying consumer

needs that insurers will have to adapt to.

For instance, the new generation of

consumers would prefer to buy items several

times in small quantities as opposed to bulk

buying. This trend is mostly informed by the

irregular income streams that intertwine

with competing needs.

The solution? “Sachet marketing”. Insurers

will be compelled to come up with short-

term products that require periodic or

regular payment either weekly, daily or

monthly.

This means that insures will sell their

products on-demand and will either turn a

policy on or off depending on the consumer

needs.

As the smartphone penetration index

continues to rise, we expect that more and

more firms will get innovative and introduce

diverse micro insurance products for low-

income consumers.

The future of insurance growth and

penetration will be anchored in technology

and its usefulness will depend on how well

the players leverage this tool to suit their

needs.

The first movers in each and every step of

the way will be the bakers of the cake while

the rest will only benefit from their

generosity.

Why insurance sales agents will exiting the stage soon

companies and the general

public to whom they offer

“last mile” service

especially where

personalised service is

necessary,” said AKI board

chairman Patrick Tumbo

not be

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 week in Nairobi.

Inumber of sales agents

nsurance companies

are set to increase the 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.

and equip them with the right skills to navigate the

ever-changing market.

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.

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.

“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. 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.

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.

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.

Some products such as medical insurance still

require human contact.

Given this, the role of the

insurance sales agent will

still be necessary. “There is, therefore, need to increase our insurance

agents to ensure that we

reach and serve as many

“Customers are now

looking for services that “They are the interface

between the insurance

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.

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.

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.

CIC Insurance has about 600 sales agents and the

number is expected to

increase to about 1,000 by

end of the year. CIC Insurance Chief Executive Tom Gitogo

said technology for now

will remain a channel of

distribution, not a

replacement.

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.

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

Gitogo.

He said sales agents need

to be digitally savvy

Association chairman

Washington Ndegea in a

Jim Collins in his book how the mighty fall talks about the characteristics of level 5

leaders

Leaders evolve Being a leader takes

courage, discipline, and determination

The best corporate leaders have an insatiable hunger for learning and are lifelong learners.

Leaders evolve

Level 5 Leadership is a concept developed by Jim Collins. After several years of

research, Collins discovered that all of the

great organizations that he studied were

headed by what he called "Level 5 Leaders. Wenterprises while others never even

hy do some companies grow to global

have a nationwide presence? How to Become a Level 5 Leader

While leaders bring great success, it also comes at a cost being a leader takes courage,

discipline, and determination

It takes time and effort to become a Level 5

Leader. But the good news is that it can be

done, especially if you have the passion to

try.

Leadership is always the lid on personal and

organizational effectiveness. The lower an

individual’s ability to lead, the lower the lid

on his potential.

Your leadership ability–for better or for

worse–always determines your effectiveness

and the potential impact of your

organization.

Take Responsibility

A top attribute of Level 5 Leaders is that

they take responsibility for their team's

mistakes or failings.

So make sure that you take responsibility for

your (and your team's) actions. Our Book

Insight into No Excuses! The power of self-

discipline has more on this.

To reach the highest level of effectiveness, you have to raise the lid–one way or

another.

Develop Discipline

Level 5 Leaders are incredibly disciplined in

their work. When they commit to a course of

action, no matter how difficult it is, they

stick to their resolve.

You can also do it through personal growth and development. Leadership can be

learned

The Law of the Lid and Organizational growth

then don't let naysayers dissuade you from a

course of action. It's always important to

listen to differing opinions, of course, but

don't let fear be your driving motivator when

you make, or change, a decision.

you can develop the qualities of a Level 5

Leader:

Develop Humility

Level 5 Leaders are humble people. So,

learn why humility is important, and make

sure that you understand – at a deep,

emotional level – why arrogance is so

destructive. Then ensure that you behave in

a humble way – for example, whenever your

team has success, make sure that credit goes

to them for their hard work.

Find the Right People

Level 5 Leaders depend on the people

around them. They spend time finding the

right people, and helping them reach their

full potential.

If you're a leader or manager already, then

you probably know without thinking who

your best people are. However, you

sometimes have to challenge these

assumptions – our article on The Leader-

Member Exchange Theory shows you how

to do this, so that you can get the best from

everyone on your team.

Lead With Passion

Level 5 Leaders are passionate about what

they do, and they're not afraid to show it.

When you demonstrate to your team

members that you love and believe in what

you're doing, they will too. If you're having

a hard time finding passion in your work,

then you need to search for the human

benefit in what you're doing

Again, it's important to realize that you don't

have to progress through each level in turn

in order to get to Level 5. But you do need

the capabilities found in each level in order

to achieve Level 5 status.

Here are some strategies that will help you

grow emotionally and professionally, so that

Conversely, as a leader, you need to take

responsibility for your team's efforts, even

when things go wrong.

If you know in your heart that you're right,

Story is told about

a young Thomas

Edison who came

home one day with a

paper for his mother. He

told her, “My teacher told

me to give this paper only

to my mother.”

Thomas’ mother read the

note and her eyes filled

with tears. Thomas asked

his mother what the note

said, and she read aloud,

“Your son is a genius. This

school is too small for him

and doesn’t have enough

good teachers for training

him. Please teach him

yourself.”

And that’s exactly what

Thomas’ mother did; she

home-schooled her child

with devotion and

dedication. As the story

goes, many years later

after Thomas Edison’s

mother passed on, and he

was now one of the

world’s greatest inventors,

he found a folded paper

among other family items.

He opened the very same

paper that had been

handed to him to give to

his mother and read the

following message:

“Your son is mentally ill.

We won’t let him come to

school anymore.”

At that moment, Edison

realized what his mother

had done for him so many

years ago. He wrote in his

diary: “Thomas Alva

Edison was an addled child

that, by a hero mother,

became the genius of the

century.”

In the book of Proverbs we

learn: “The words of the

reckless pierce like swords,

but the tongue of the wise

brings healing.”

Can you imagine what

might have happened to

Thomas Edison if his

mother had read to him

the reckless and hurtful

words written by his

teacher? He might never

have invented the light

bulb or made his many

other contributions to

society.

Thank God for the wisdom

and wise words of his

mother! She created the

context in which her son

could grow to his full

potential.

Let’s take this message to

heart and resolve to use

our words for healing

today. You might be a

parent, what do you say to

your children.... You might

be a teacher, what do you

say to your student...

especially the ones that

are not really performing

well presently.... What do

you say about your

parents, family, boss,

subordinate, leader,

colleague, follower....?

Just as hurtful words can

cause uncontrolled

damage for life, so can

wise words positively

affect a person for life?

May the words you use

today change a life for the

better?

A

IT Department

profession and his calling with integrity and deligence.Harold is passionate with ICTrelated stuffs like repair and

others.

Harold Mtsonga is an IT graduate who handles his

,web maintenance and among maintenance, web application

Congratulations to Harold Mtsonga for being our First Quarter employee of the year.

Our Employee of the First Quarter 2018

9

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LEVITES INTERNATIONAL REINSURANCE BROKERS LIMITED

REINSURANCE BROKERS LIMITED

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