What’s disrupting the insurance industry in South Africa? How are companies responding, and what are they looking for in their consultants?
Senele Mbatha is no stranger to disruptive changes. He joined EY in 2005 at a time when significant regulatory changes were underway in South Africa. Most companies had already started to transition from local generally accepted accounting principles (GAAP) to International Financial Reporting Standards (IFRS); new standards kept on being issued; and Senele himself had to learn to work in new domains and with new regulations.
Now, as the CFO of AIG Africa, he’s witness to bigger industry-wide disruption. “The biggest challenge we face in the insurance sector in Africa is the change in our regulatory framework,” he says. “In South Africa, we are introducing Solvency II. In Kenya, we are introducing RPC. And other jurisdictions are also really changing their regulatory environment.”
The fury of nature has made things even more disrupted. “We had floods in Cape Town, fire in Knysna and storms here in Johannesburg. And that really is starting to create a dent.”
In spite of the stress these external factors have exerted on insurance companies, they are under pressure to reduce cost, and decrease and eliminate manual work in their processes. Therefore, “everyone is asking, ‘How can we innovate? How can we automate? And how can we get to our policyholders quickly?’”
For Senele, EY is still his home. He continues to reach out to EY people for advice. “If I come across a challenge, I know who at EY can solve it for me. I have been reaching out to EY for their support, to challenge the assumptions that we’re making, and also to get a perspective of what the market is doing and where the market is going.”
He says he also works with EY “to see how they can assist me with having a few bots in our organization that can help us eliminate the manual processes and concentrate on doing the work that adds value to our policyholders.”
What makes an advisor?
So, what do companies that want to navigate disrupted landscapes look for in their consultants? According to Senele, it is confidence and resolve as much as it is knowledge and experience. “If they advise me on something, that’s because they know it and they’ve got experience on it. And they will stand by it and defend it. That’s really what I want.”