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Digital Insurers – The Role We Play Beyond Protection

Eddy Wong, Co-Founder, CEO and Managing Director of VSure.life

The financial industry has always been regarded as a key cornerstone for economies, facilitating stability and growth through its services for government, businesses, and the public. Now that we are in 2022, financial services in a digitalised form are set to become the norm, driven by a new generation where digital channels and infrastructures are the preferred mode for transactions.

As one of the core financial services sector, insurance have always provided the vital service of protection, safeguarding organisations and individuals against unforeseen accidents or circumstances. While the role of insurance is understandably critical, this is not exactly reflected in today’s reality as Malaysia’s underinsured population have consistently hovered around the 50% mark in the past few years.

This problem has served as a rally cry, that have seen to both public and private sectors continuously finding ways to bridge the underinsured gap, something we have witnessed in the Perlindungan Tenang programme. This has also led to the emergence of the relatively new digital insurance market segment with its presence accelerated due to pandemic-driven (fear) economy, continuous escalation of medical costs, unaffordable protection, and a lack of financial inclusion.

A rising star in the digital insurance market are the digital insurers, a new generation of players comprised mostly of startups that wants to revolutionise insurance offerings and impact through tech-driven innovation. While digital insurers are still relatively small compared to the giants of the insurance industry, with the right innovation and go to market strategy, they could massively contribute to reducing the number of underinsured. VSure is one such player that offers bite-sized insurance adapted to suit the modern lifestyles of Malaysians.

Beyond closing the underinsured gap, digital insurers also play a critical role in driving Malaysia forward in more ways than one. Here are the three key roles digital insurers play, beyond offering protection.

Impactful Innovation

Like other industries, we have observed many insurance players undergo accelerated digital transformation processes in the past few years. Similarly, digital insurers who are digital by nature, operates on a redesigned model that prioritises a completely end-to-end digital experience, with a distinction on innovative product offerings that sets it apart from competition.

The race to close the underinsured gap have pushed digital insurers to continuously develop new insurance and protection solutions that are more affordable, beneficial, and meaningful for the people and socioeconomical benefits of Malaysia. We are glad to be taking part in this race and contribute to Malaysia with new, innovative, and impactful protection that can help the nation as a whole move forward.

Digital Economy

This is a key focus point for Malaysia as detailed in the latest MyDigital blueprint, the digital economy is expected to contribute 22.6% of the nation’s gross domestic product by 2025. As digital insurers fit under the digital economy umbrella, we too contribute to its growth in many ways.

Firstly, digital insurers have a key role to play in educating the masses on new digital-based offerings. With majority of the underinsured hailing from the B40 bracket, digital insurers must also bear the responsibility to help Malaysians adapt to its new solutions, helping the rakyat go digital. Digital insurers also contribute to the creation of a digital workforce, with the constant need for tech talents to support its existing business and future plans to innovate with the incorporation of Internet of Things, Artificial Intelligence, Big Data, and more technologies into its offerings.

Digital insurers also protect digital economy workers. The gig economy workforce is a massive subset of the digital economy and many digital insurers have introduced cost-effective insurance solutions that protects gig economy workers who have continuously worked tirelessly throughout the pandemic period.

Financial Literacy

This is perhaps the most crucial role in my opinion. While the importance of financial literacy cannot be understated, unfortunately there is still a lot more to be done in this space, as private equity firm Creador’s 2020 survey indicated that almost 70% of Malaysians need financial literacy support.

As a key sector in digital financial services, digital insurers must also lead the charge in this battle to continuously educate Malaysians on the importance of staying protected. This is a key mandate given to VSure as participant of Bank Negara Malaysia’s FinTech Sandbox programme, in which we have been implementing through hosting lifestyle activities that comes with protection equipped. An example is our Charity Virtual Runs, where participants paying a minimal fee will get to the take part in the run, financially contribute to partnering non-profits, and receive VSure’s Flexi-Fit personal accident protection.

This battle to educate masses on the importance of financial literacy needs to be fought by all parties at an ongoing basis and I am glad that digital insurers have a role to play in this fight and remain hopeful that our contributions will be able to help move the needle.

Source: Creador: 70% of Malaysians in need of financial literacy support – The Edge Markets

Eddy Wong is Co-Founder, CEO and Managing Director of VSure.life

The views expressed are those of the writer and do not necessarily reflect those of Bank Negara Malaysia, the organiser of MyFintech Week 2022.

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