From: RegTech Analyst
INSTANDA’s CEO has welcomed the Financial Conduct Authority’s (FCA) measures to protect insurance customers, but argued that the COVID-19 crisis has highlighted the need for the industry to evolve.
The coronavirus pandemic has caused many regulators around the world to snap into action in multiple efforts to protect people and ensure stability through the crisis.
One of the initiatives the FCA has made was to introduce a number of guidelines for insurers in order to keep their customers’ interests at the front of mind as COVID-19 continues to wreak havoc on the world economy.
The package was introduced earlier in May. It included instructions to insurers to make sure their policy holders are not financially harmed because of the pandemic, to reassess the risk profile of customers, consider what products they have that better fit the customers needs and to wave cancellation fees.
Now, Tim Hardcastle, CEO and founder of INSTANDA, the InsurTech company, welcomed the initiative and called it “a hugely positive step for the insurance industry and regulators to co-ordinate support to the many families and small companies that even after extensive government support may still be struggling financially as a result of this pandemic.”
“The primary challenge for insurers will be in how they can quickly adapt their systems and processes in order to meet the demands of these new measures in the most seamless and cost-effective way possible,” he continued.
“The positive news is that there are a number of flexible digital solutions out there for insurers to enable them to bypass their outdated legacy systems and adapt at speed, whilst keeping operational costs to a minimum. This in turn will deliver real benefits to the end customer.
“The COVID-19 pandemic has brought to light the desperate need for digital transformation of the insurance sector and the FCA’s ruling is yet another example of this. Insurers must embrace technology and digitise their business as they seek to adapt to changing customer demands not just now, but also in the future.”
Hardcastle is hardly alone in having made the link between the pandemic and the need for the insurance industry to innovate.
A few weeks ago, FinTech Global spoke with several stakeholders in the industry who noted that the InsurTech industry could come out as the big winner of the crisis as the coronavirus has highlighted the shortcomings of insurers’ legacy systems.
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