Cargo claims remains a key opportunity which is continuously ignored by risk and transport carriers in the transport and marine insurance industries.
Our industry is undergoing significant changes, arguably more than any period in its history. From increased container ship fires, to ever increasing regulations, to disruptions from innovative startups. Customers are demanding better services from insurers and transporters the consequence of which is reduced margins.
In a short piece we wrote a while back on insurance penetration in Africa, we espoused why it was important for players on the African continent to rethink their approach of reaching their customers. According to IUMI‘s report from Canada last year, insurance penetration in Africa has not changed much. Accordingly, the sceptical approach of the target customer on the relevance of an insurance product is still very present.
While the industry faces challenges, if looked at closely, these challenges present significant opportunities for risk carriers to change the perception of their current customers thus reaching out to new ones through word of mouth recommendations.
Today, it is easier for marine insurers to detect fraud, carry out administrative tasks and then pay out cargo claims with as little inconvenience to the customer as possible. Also, because of the increase in regulations, cargo owners are also expected to spend more in terms of compliance. This too is an opportunity for insurers to design new products that speak to the newbie international trader. It is easier today that it was many years ago to find and locate traders across the continent. With one of the world’s highest mobile phone penetration levels, digital insurance products must be the norm.
For any technology fanatic, you must have heard about the likes of Lemonade. They handle a record 30% of their claims instantly with the shortest time being 3 seconds. That is a world record! Of course, you may not be able to tell of similar record times with cargo claims. But efforts must be made to make it easy for cargo owners and insurance beneficiaries to conveniently claims against an insurer. In the Lloyd’s market, we hear of parametric insurance. This simply means in the event of a particular event, an automatic payment is made out to the policy holder. Say you have a flood insurance cover for your home. Should significant rainfall occur in your area and the sensor on your walls read a water level up to that under your policy, then you get paid. Is this possible with cargo claims?
In a few days time, some of our colleagues will be hosting a seminar on cargo claims, specifically for perishables. The hope is to reach marine insurers with appetite for fruits and attendees of Fruit Logistic in Berlin. During this webinar, we will be addressing some of the concerns relating to cargo claims both from the policy holder’s perspective but also from the risk carrier’s perspective. It is therefore our recommendation that marine insurers attend this webinar let us together explore ways which you can leverage claims to reach new customers. As our CEO often say, cargo claims present an opportunity to demonstrate a promise kept. Don’t fear it, embrace it.