It's no secret that few people trust their insurer. Stories of unpaid claims, unfair premium increases, and difficulties cancelling are commonplace around the braai or at drinks after work. A new breed of insurance providers believes they can address these concerns, offering a slick customer experience and reversing the cycle of distrust between insurers and their customers. This new breed is known as insurtech startups, and 2018 will be the year they make their mark in South Africa - but how are they different to current insurers?

Putting you in control and saving you money too

Insurtech startups will give you full control of your insurance via digital platforms. Customer empowerment won’t just include adding an item or requesting emergency assistance like some insurance apps currently offer, but rather will encompass everything you might want to do as a customer.

This includes getting a quote as a new customer, starting cover instantly, making a change to your policy, even cancelling all your cover, all to be done in your own time, on your own device. Customers will benefit from quick and easy processes, compared to the frustration of dealing through a call centre or broker.

Of course, cutting out the call centre has the added advantage of significantly reducing the insurer’s customer servicing costs, so you will pay less for the same cover too.

Increased transparency

Looking deeper, technological empowerment will also increase transparency and customers will be able to cancel instantly, without interacting with a call centre, which means there will be no second chances to lower the premium which the customer had been paying all along in a last-ditch effort to retain them.  This will put the onus on insurers to provide value for money all the time, not just when you first sign up or try to cancel.

Greater confidence in the claims process

Along with transparency will come a far greater pressure for insurers to do what customers expect - particularly when they claim. Many of the current client frustrations in the claims process (like uncertainty on the progress of your claim) are expected to be improved through insurtechs’ overhaul of the claims process. Automated AI-driven processes that remove the need for human approval (in most cases) will not just reduce the overhead cost of processing claims (and ultimately the premiums), but will also remove the subjectivity of human judgement.

Better relationships

“Insurtech startups have the potential to repair the trust relationship between the insurer and the customer, dramatically improving customer experience,” says Alex Thomson, co-founder of insurtech Naked, which is expected to launch in South Africa shortly. “After spending many years inside the industry, we realised the only way to get this right was to start from scratch, without a link to any legacy systems and processes, or corporate thinking.”

Some of the simplest ways of telling whether you are dealing with a true insurtech is to find out whether you can start a new policy without speaking to a call centre (which should mean, on average, lower premiums), or whether you can cancel instantly without talking to someone. If not, it may be worth considering why you want to miss out.