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Discovery is one of the largest, most recognised insurance companies in SA. CompareGuru caught up with them for a little chat.
Discovery's Ambition 2018 goals see the company aiming to be the ‘best insurer in the world.’ The group’s performance over the second half of 2017 exceeded all expectations. In the six-month period, ending 31 December 2017, Discovery saw an impressive increase in profitability.
They’re well on track to achieving their goals. Not only that, but the company has invested R1.2 billion in preparation to launch its own bank this year.
We caught up with one of South Africa’s leading insurance companies to chat about what they do, how they do it and their plans for the future.
Discovery Insure was formed in 2011 as part of the Discovery Group (Discovery Ltd). The company is a global, integrated financial services organisation operating in the healthcare, life assurance, short-term insurance, savings and investment products and wellness markets.
Discovery pioneered the Vitality shared-value insurance model which is used across all our businesses and is the reason behind our phenomenal growth. The shared-value insurance model was founded on Discovery’s core purpose of making people healthier and enhancing and protecting their lives. It is based on Vitality, a scientifically-validated wellness programme. Vitality draws on behavioural economics to support, guide and incentivise individuals to improve their health. When integrated into insurance products, it allows for dynamic pricing of risk over time, based on people’s engagement in their health.
We realised that these learnings could be applied to the short-term insurance industry, which led to the founding of Discovery Insure. South Africa has one of highest road fatality rates in the world, yet people typically think they are better drivers then they really are. But, by encouraging people to drive well, we can have a positive impact on society while also deriving economic value. Discovery Insure has experienced phenomenal growth in the past 6 years. We currently insure over 195000 vehicles and over R208 billion in insured assets.
Give us a bit of background into what brought about the beginning of Discovery and what has motivated your growth over the years?
Discovery Insure was formed in 2011 as part of the Discovery Group (Discovery Ltd). The company is a global, integrated financial services organisation operating in the healthcare, life assurance, short-term insurance, savings and investment products and wellness markets.
Discovery pioneered the Vitality shared-value insurance model which is used across all our businesses and is the reason behind our phenomenal growth. The shared-value insurance model was founded on Discovery’s core purpose of making people healthier and enhancing and protecting their lives. It is based on Vitality, a scientifically-validated wellness programme. Vitality draws on behavioural economics to support, guide and incentivise individuals to improve their health. When integrated into insurance products, it allows for dynamic pricing of risk over time, based on people’s engagement in their health.
We realised that these learnings could be applied to the short-term insurance industry, which led to the founding of Discovery Insure. South Africa has one of highest road fatality rates in the world, yet people typically think they are better drivers then they really are. But, by encouraging people to drive well, we can have a positive impact on society while also deriving economic value. Discovery Insure has experienced phenomenal growth in the past 6 years. We currently insure over 195000 vehicles and over R208 billion in insured assets.
What sets Discovery apart from the rest? Is there anything you offer that no other opposition could?
The Discovery Insure business applies the behavioural mechanisms first used in our health business to our clients’ driving behaviour. The Vitality drive programme uses powerful incentives, such as up to 50% back in monthly fuel spend and other great rewards, to encourage better driving behaviour. This directly reduces the cost of insurance since better drivers have fewer and less severe accidents. These savings are passed back to our clients through Vitality drive rewards. Society, as a whole, benefits as South African roads become safer. We call it Shared-Value Insurance, because value is created and shared between the insurer, clients and society. Our technology that measures driving behaviour, called the smartphone enabled DQ-Track, received two Gartner Financial Services Cool Business Awards in 2015. These were for the Most Innovative New Digital Product and the overall EMEA Digital Champion categories.Do you need to DROP your insurance premium? Compare here today and start SAVING
Who is your typical customer?
Generally, anybody who needs innovative, comprehensive and flexible car and household insurance. We typically attract good drivers, as well as anybody who wants to improve their driving and become a good driver, since these people naturally resonate with our value proposition.What will continue to set you apart in the next decade?
Innovation. Since the inception of Discovery Insure in 2011, we have introduced over 40 unique benefits to the South African insurance market.How many people are currently employed by Discovery? And if you could communicate to them right now in a single paragraph, what would your message be?
Discovery Insure has just under 700 people employed, while the broader Discovery Group has about 12 000 employees. At Discovery Insure, our core purpose is to create a nation of great drivers.How can your clients achieve the best results and gain the most satisfaction from your brand?
The first step to getting the most out of our offerings would be to join the Vitality drive programme. The programme offers unparalleled value for clients in the form of rewards for driving well, as well as state-of-the-art safety features which keep them and their family safe on the road. These safety features include ImpactAlert, which allows us to send emergency services to clients if we detect a severe impact to their car, even if we cannot get hold of them. With Vitality drive, clients can earn to up to 50% back on monthly fuel spend as well as earn a coffee, smoothie, popcorn or a discounted car wash each week for simply driving well. We also offer up to 25% discount on Uber trips. We also have other cover benefits, such as no excess on theft or weather related claims.How are you using technology to adapt and create the best experience for clients?
We use exceptional InsurTech throughout the client journey, from onboarding straight through to servicing and claims. Clients can complete a vehicle pre-inspection easily and within minutes through the app. We also use superior technology to measure and reward them for good driving. Clients can log their claims online and track them in real time. On top of this, our latest feature, InstantCover, enables clients to instantly cover their household contents and portable possessions using their smartphone, anytime and anywhere.How, specifically, does Discovery determine success? Do you measure it through growth, stability, profitability or something else?
We use all the normal financial metrics such as growth, loss ratio and lapses. In fact, Discovery Insure is the fastest growing insurer in South Africa. In addition, because better drivers have fewer and less severe accidents, we see a positive trend in terms of loss ratio (claims/premiums) We also measure ourselves against our core purpose of creating a nation of great drivers. We have seen that clients who use the smartphone-enabled DQ-Track improve their driving behaviour by 15% within the first 30 days of joining Discovery Insure and this improvement is sustained over time.
Over the last couple of years, the world has changed quite drastically. Has the insurance industry changed? If so, how, and have you managed to keep up with the pace?
We have definitely felt the impact of these changes on the insurance industry and, more specifically, the impact of technology. We see the application of InsurTech (insurance technology) which is "a set of innovative business models and platforms that bring in new customer experiences by applying innovative technologies in the insurance industry” being more relevant in our business model. The disruption caused by InsurTech is because of the constant connectivity and huge volumes of data generated by many telematics devices, wearables and the Internet of Things. Using this data, InsurTech has enhanced the risk assessment, pricing, service solutions and product development for many insurers that have adopted big data analytics. Discovery Insure is in a unique position to use technology to add value to clients, and we currently use the vast amount of structured and unstructured data collected from driving data, data captured at underwriting and from interactions with our clients. This information is used to make sure we price accurately, give clients the ability to control their premiums through fuel rewards, and create new products and benefits.What changes have you made, no matter how small, to achieve the biggest possible impact?
Encouraging our clients to be better drivers by rewarding them for it, and being able to reduce accident frequency, which has a positive impact on society.If Discovery could be associated with one single word in the minds and thoughts of customers and employees alike, which word would that be?
Innovation.