Interview: Robert Trestrail
How do you expect the insurance sector to be impacted by the current recession?
ROBERT TRESTRAIL: The insurance sector is fairly resilient to crises, and insurance products are usually maintained notwithstanding clients experiencing challenging times. Customers who maintain policies do not necessarily want to give them up, they understand that qualifying for the same type of policy will be affected by their age and health, along with other key factors.
To assist customers who may be squeezed by the current economic downturn, there are a wide range of options which insurers may use to ensure customers are appropriately informed about their alternatives. As an industry we can do more to fully engage each of our customers and increase their awareness of the different types of coverage. The true challenge now lies in our ability to ensure customers are receiving the best possible advice and that they are making wise financial decisions. Trinbagonians must do a better job in planning their financial health and understanding that the earlier they begin to plan their future, the better off they will be in the long term. Too often household financial management is limited to buying real assets, while the importance of planning for death, disability or retirement is ignored. Trinbagonians often lose sight that we live in a region that is subject to tropical storms and earthquakes, and that there is a need to ensure that their businesses and homes are adequately insured and prepared in the event of a natural disaster.
What innovations could be introduced?
TRESTRAIL: Insurance is a financial service offering that is usually associated with life events, and individuals tend to start understanding the need for insurance products in their thirties. The industry needs to find a way to engage those future customers who are not inclined to buy from agents, and make sure that we interact with them via their preferred channel – their smartphones. For life policies in Trinidad and Tobago, there are currently no opportunities for online sales and I expect the same holds true for the property and casualty lines. The introduction of online sales that is characterising some markets could be beneficial on the property and casualty side, as those products are more easily promoted through mass communication. Things are a bit more complicated when trying to engage a customer on the importance of life insurance, retirement planning or disability coverage. Insurance companies that offer these products must appreciate that new consumers are less inclined to engage an advisor and are increasingly educating themselves on what they intend to purchase. In many developing countries, micro-insurance is growing, with simple insurance products being available at your local supermarket or via your mobile phone. This shift will come to our market and all stakeholders must be prepared to respond. The customer of the future will demand it and those not positioned to respond will be impacted.
Is the portfolio of the now-defunct CL Financial Group relevant from an industry perspective?
TRESTRAIL: The CL Financial Group had two insurance companies, Colonial Life Insurance Company and British American Insurance Company. Together, it is estimated that those companies would have had approximately 150,000 policyholders. From an industry perspective, those policyholders understood the importance of insurance and the importance of planning for life’s eventualities – retirement, critical illness, health-related issues or the death of a loved one. As an industry we owe it to those policyholders to ensure that the confidence that they have placed in us is not lost. We have expressed our willingness to assist with the resolution of the CL Financial Group, which will allow those affected customers and policyholders to benefit from wise financial thinking for life.
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