PensionsSep 2 2015

Providers looking to tech to bridge gaps

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Providers looking to tech to bridge gaps

A barrage of regulatory changes will force providers to diversify from traditional advisory distribution models towards direct-to-consumer, Vinay Nagwekar has said.

The principal consultant and director of product development for insurance software provider Majesco warned that life companies were desperately trying to ‘keep the lights on’ despite the regulatory changes.

He said: “We can see more providers looking at direct-to-consumer models, as regulation is continually coming in. We have Solvency II, driven by Europe, on top of the gender-neutral pricing directive.

“Add to this the pension freedoms and it is clear that regulation is bombarding the industry. With pension freedoms, especially, there is a big gap because so few people can afford advice. Where will they get help if they cannot afford to go to an independent adviser?”

With so many choices available to consumers, whether in the accumulation or decumulation phase. he said it was understandable that life and pension providers may be developing cheaper channels.

Paul Delbridge, partner in the insurance practice at PriceWaterhouseCoopers, said using technology and ‘big data’ could be “transformational” in the way that providers meet clients’ needs.

He said: “It would enable insurers to engage with customers on a new level, deliver the right outcomes and develop the lifecycle management that has eluded the industry for so long.”

ADVISER VIEW

Peter Le Beau, Managing Director of Kent-based Le Beau Visage, said: “There are a number of conflicting pressures which will shape future markets. I think the bigger issues in relation to technology will be consumer propensity to transact online and ease of dealing.

“Markets may be driven by regulation, but I prefer to think the biggest driver will be matching customer need with relevant propositions.”