annual forum - insurance council · \爀屲ceos of 對nine major mining houses came together and...
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2017 ANNUAL FORUM
FRIDAY FEBRUARY 17, 2017 – HILTON SYDNEY
Mr Michael PascoeMaster of Ceremonies
Introduction
Rob Whelan
Executive Director & CEO
Insurance Council of Australia
Welcome address
The Hon. Kelly O’Dwyer MP
Minister for Revenue and Financial Services
Video address
Social licence and general insurance
Mr Richard Boele
Partner, KPMG Banarra
Plenary session 1
Why am I here?
What is social licence?
Mining, Sustainabilityand The Agents of Change
Daniel M. Franks
MOUNTAIN MOVERS
What did mining industry do?
MMSDMining, Minerals and Sustainable Development Project
MMSD20 countries
700 people in 23 global workshops
175 research projects commissioned
Companies participating went from 9 founders to 259
25
Where is general insurance?
The potential for erosion of trust is a threat that must be dealt with and the industry should
be more proactive in responding to this…
GEOFF SUMMERHAYES APRA Member
Where is general insurance?
Recent queries submitted to a major Australian insurer’s Facebook and Twitter assets historically from 7 February 2017.
84%(133 posts)
16%(25 posts)
Policy-relatedqueries (incl.customer service)
Other queries*
Where is general insurance?
88% of queries submitted to the insurer’s Facebook page were about policy matters
(incl. customer service).
58% of these posts were negative.
LISTEN, UNDERSTAND, RESPOND
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Morning tea break:Refreshments will be provided in the foyer
The next session will start at 10.30am
Morning tea break
Coming up
10.30am: Plenary Session 2 ─ Senator Katy GallagherShadow Minister for Small Business and Financial Services11am: Plenary Session 3 ─ Mr Geoff SummerhayesMember, APRA11.45am: Plenary Session 4 ─ Mr Greg MedcraftChairman, ASIC
Senator Katy Gallagher
Shadow Minister for Small Business and Financial Services
Plenary session 2
Australia’s new horizon: Climate change challenges and prudential risk
Mr Geoff Summerhayes
Member
Australian Prudential Regulatory Authority
Plenary session 3
Issues for the year ahead
Mr Greg Medcraft
Chairman
ASIC
Plenary session 4
Lunch break address by Mr Mark Textor:
Current domestic and international political trends
Please move to Level 4 for a sit-down lunch
Plenary Session 5 will commence at 2pm sharp in Ballroom A
Lunch break
2pm: Ballroom A: Plenary Session 5 – Effective Disclosure: Release of findings of the ICA Research Project 3pm: Ballroom A: Breakout session 1 – Self-regulation in action: The general insurance industry 2014 Code of Practice and its 2017 review3pm: Ballroom B: Breakout session 2 – How the ICA’s DataGlobe and resilience tools are improving community outcomes 4.05pm: Ballroom A: Breakout session 3 – General insurance and mental health: The need to improve outcomes4.05pm: Ballroom B: Breakout session 4 – Insurtech projectsAll sessions from 3pm will be closed to media
Coming up
Effective Disclosure: Release of findings of the ICA Research ProjectChair: Mr Michael Gill, Insurance Council Effective Disclosure TaskforceMr Richard Enthoven, CEO, The Hollard Australia GroupMs Karen Cox, Coordinator, Financial Rights Law CentreMr Matt Sandwell, The Lab
Plenary session 5
Effective Disclosure Taskforce• Independent Taskforce established by ICA Board in 2015 to review
the effectiveness of, and recommend initiatives to enhance, disclosure.
• Taskforce chaired by Michael Gill, and comprised of experts from industry, consumer movement, academia and behavioural sciences.
• Taskforce report, Too Long; Didn’t Read. Enhancing General Insurance Disclosure, submitted to the Board in October 2015.
• ICA Board endorsed all 16 recommendations by the Taskforce.
System 1Fast thinking/Automatic
intuitive, effortless
2x2
Taking your daily commute
System 2Slow thinking/Reflective
deliberate, analytic
24x17
Planning a trip overseas
“It turns out that the environmental effects on behavior are a lot stronger than most people expect”
Daniel Kahneman, Nobel Laureate
Dual-process theory of reasoning
Key research-related recommendations• The ICA should establish a disclosure performance benchmark by
commissioning research on current consumer knowledge and understanding of commonly purchased general insurance.
• The ICA should commission research to determine pre-purchase consumer behaviours and how disclosure can be used to nudge appropriate decision-making.
• The ICA should research consumer behaviours in relation to decision-making about the sum insured for home building insurance.
Role of foundational research
Consumer Research on General Insurance Product Disclosures
KEY FINDINGS
Who we spoke to…150 customers at key moments of truth
n=30 FACE TO FACE, POINT IN TIME ETHNOGRAPHY
n=120 DIGITAL, LONGITUDINAL
ETHNOGRAPHIES
EXPERIENCED AND HIGHER ENGAGEMENT
WITH THE DETAILS
EXPERIENCED AND LOWER ENGAGEMENT WITH THE
DETAILS
FIRST TIMERS WITH THIS PARTICULAR TYPE OF
INSURANCE
VULNERABLE GROUPS SUCH AS ESL, LOWER EDUCATION
LEVEL AND LOWER SES
HIGHER RISK CONSUMERS OR HAZARD PRONE
AREAS
6 x customers – at some point in their decision
6 x customers – at some point in their decision
6 x customers – at some point in their decision
6 x customers – at some point in their decision
6 x customers – at some point in their decision
24 x ‘full’ experiences 24 x ‘full’ experiences 24 x ‘full’ experiences 24 x ‘full’ experiences 24 x ‘full’ experiences
• Across a prioritsed range of the following: Home Building, Motor Vehicle, Travel, Home Contents, Personal Sickness and Accident, and Pet Insurance products
• Broadly representative sample across demographic (age, gender, lifestage) socioeconomic (education, income) and geographic (States, City vs. Regional)
• All to be the main or joint decision maker for insurance products, and to be currently in the process of making a decision re: insurance products
What we asked them…Understanding their journey in their words
SO WHAT DID WE FIND…
There is no single pathway to purchase and the use of information in decision-making is highly varied…
Although varied, there were common themes that helped to define this variance and ultimately help make sense of the market
While most consumers report they have evaluated the details of their policy, most do not access the PDS, or the KFS…
So what are they using…
And why…
While most consumers are confident in their understanding…
Comprehension appears to be poor
For some, it appears that the best ‘education’ is to have made a claim, those who have claimed are more likely to read and understand
The end result…
Many consumers simply do not consider the specific risks relevant to them, when purchasing cover, until its too late…
SO WHAT DOES IT MEAN FOR THE
PDS?
The PDS can be improved, although there are also broader opportunities for engagement…
The PDS…
• The depth and detail of the information contained in the PDS is a key positive
• However conversely, the PDS is seen as too detailed and inaccessible, reducing the likelihood that it will be used as a pre-purchase document.
• Tools that will enable the PDS to be searched and made more digestible are likely to be beneficial.
• And not just the detail but the inclusion of examples re: possible claims scenarios.
Beyond the PDS…
• The renewal letter is the most commonly used and highly rated source of information, and presents opportunities to provide targeted information.
• There are opportunities to target information provided through online quotes, which are commonly used by new to market consumers and who have the lowest understanding of general insurance concepts.
• Increased trust in sum insured calculators is important to encourage more informed decision-making.
Thank you…
2017 ANNUAL FORUM
FRIDAY FEBRUARY 17, 2017 – HILTON SYDNEY