On 9 November started in Opatija, Croatia, the 2017 edition of the Croatian Insurance Days Conference, the traditional meeting of the Croatian insurance top professionals with their European peers. XPRIMM Publications are supporting the event as Media Partners.Organized by the Croatian Insurance Bureau, with the support of the Ministry of Finance of the Republic of Croatia, the conference has a rich and very informative program, also providing for extended networking opportunities.
Damir ZORIC, President of the Board, HUO - Croatian Insurance Bureau
- The insurance world is changing, as well as the way we are doing business, the risks and the risk perception etc. We need to understand how things are changing and at the same time to accept change and go with it, be innovative.
- Recently we have prepared a draft of law, to amend the current insurance law by incorporating the IDD and we hope the law will be adopted and published soon, so that 2018 finds us prepared, even if the IDD implementation will be delayed or not
Mario Radakovic, Vicepresident, HANFA - Croatian Financial Services Supervisory Agency
- Are we not over regulating? This is a question which might be valid for every regulating authority after the 2009 crisis.
- Croatia fell on the penultimate place in CEE in GDP/capita terms; for people to be able to spend and also save more, that must change and the growth patterns need to be improved. Only an increasing purchasing power will really enable insurance spending growth.
- We need to improve the population's financial literacy, but we also need better qualified people in the insurance industry. Providing better professionals to the industry is a task that HANFA has taken upon itself.
- In GWP terms, we can talk about stagnation in the Croatian market, but given the way things have evolved after the motor insurance liberalization, we can say that stagnation is, in fact, a successful result: we have managed to maintain the market volume despite the high competitiveness on the MTPL market
Damir VANDELIC, President of the Management Board, CROATIA osiguranje d.d.
- New technologies are bringing important opportunities, the middle class's assets growth being one of them; better awareness of risks is an opportunity that insurers need to help become effective; higher costs of medical service may also encourage health insurance development;
- InsurTechs are a challenge to the clasic insurance providers, but also a stimulus for modernization;
- Insurers need to modernize and keep up the pace with the overall technological revolution. because, otherwise, they will be less and less able to find and retain talents in their own workforce;
- The Croatian market needs to move faster in modernization and digitalization terms in order to become more cost effective, to be in a closer relation with clients, to become more attractive for the workforce.
Gregor PILGRAM, CFO, GENERALI CEE Holding
- What we expect is to see an increased focus on improving capital management;
- In 2018 - IDD, GDPR,MiFID II; 2021 - first IFRS 17; it may seem that there is a long time until 2021, but it is not quite so; in addition, all these changes are coming in a world which is very fast changing because of technology ...so there is a double challenge;
- InsurTech startups, with over 1.7 billion USD, are also a challenge and maybe traditional insurers should, at least in part, adopt some of the automation systems used by the tech "newcomers";
- The generational change and decrease of unemployment will accelerate the need of automation - by 2020, up to 50% of the workforce will be the Millennials -on a scale from 0 to 100, the insurance industry's attractiveness for them is "-1"; so maybe insurers will have automatize as many processes as possible;
Gordana LETICA, Member of the Management Council, Croatian Financial Services Supervisory Agency
- Under the wave of changes, supervision, market players and customers are all practically embarked on the same boat, with different but similarly important tasks which aim to give the boat the strength to resist storms;
- The market has stagnated in GWP terms, but market indicators are improving. For example, the' combined ratio for MTPL was 88% in 1H2017; on the CASCO segment, the same indicator was of 104%, but in 2013 was of over 120%, so there is an improvement;
[Panel]
Marijan KRALJ, Member of the Management Board, CROATIA osiguranje d.d.
Sasa KRBAVAC, President of the Management Board, UNIQA osiguranje d.d.
Marin MATIJACA, President of the Management Board, TRIGLAV osiguranje d.d.
- Insurers are the third most criticized financial institutions by the press in Croatia, after banks and saving institutions for real estate purchase financing.
- Customers' opinion on their insurer is mostly formed in a moment when the client has already experienced a loss, so he is most sensible. Given this reality, it is very important to find a way to build his confidence in us before the loss occurs, so at the claim settlement moment to find ourselves -client and insurer -, as a team.
- 25% of our clients never experience a loss situation. For them, buying insurance and trusting their insurer is very much a matter of financial literacy.
- 63% of the discontent clients think that insurers are promising more than they are actually willing to offer. To correct such perception, the sales process has to be improved, so that the client will have realistic expectations from their insurer.
Andreja RADIC BLAZIN, Head of Insurance Sector, Croatian Financial Services Supervisory Agency
- Reporting has become increasingly complex and for each reporting period there are tens of thousand pieces of data entries to process and analyze;
- PRIIPS, the complex, packaged life insurance products are the object of a substantial transformation, challenging both for insurance providers and the supervisory agency. A particularly challenging issue is that of the costs both of implementation and operational. Providing a fair and relevant comparison of the products is also a difficult task;
- For the time being there are not very many complex products in our market's offer, which makes things somehow easier for the agency. Yet, for the distributors, IDD requirements are not easy to address;
Michael BRANDSTETTER, EU and International Affairs, Austrian Insurance Association
- Key challenges in the CEE markets with regard to the EU regulations implementation:
- IDD - implementation timetable almost impossible to follow
- PRIIPS - there still opened questions: scope, treatment of insurance tax, comprehension alert
- GDPR - there are critical question about the practical aspects of implementation
- In the future:
- PEPP - pan European pension Product - there are several unclear aspects, as for example the banks' access to this product etc.
- ESA Review - there is the risk that small markets may actually have no supervisory function left
- Review of motor insurance directive - scope, motor guarantee funds etc.
- Recovery & resolution - is more than important to understand that insurance is very different from banking and R&R solutions should fairly reflect the difference
Tereza KUNERTOVA, Senior Policy Advisor, EU Affairs, Czech Insurance Association
- Each piece of Level 1 regulation is accompanied by tens of second and third level pieces of technical regulation, which companies will have to deal with all
- Overall, there are tens of disclosure requirements and in many cases information duplicates; in addition, in some cases national bodies decided for a gold plating implementation which adds another burden
- The big risk is that consumers may get lost in so much info and in the end the main goal of consumer protection will be not touched despite the huge effort
- Most Czech consumers stated in a poll that "clearer insurance conditions" means for them, in essence, a easier to understand language, without misleading terms and conditions
Katalin LENCSES, Head of Committee: Life, Health, Accident, Hungarian Insurance Association MABISZ
- Investment products on the savings market
- 80% of investment decisions are made face to face - most clients are confused and need assistance; this gives to the sales person a very important role
- UCIT KID and PRIIPS KID are not comparable; both documents present complex information and several figures that need additional info in order to be correctly understand
Croatian Insurance Days - Day 2
Mladen GAVRANCIC, President of the Management Board, OTP Osiguranje d.d.
- Each of us, insurers, should answer at least this question before deciding to implement UBI products: Which type of usage based insurance is relevant for certain categories of clients and, in the end, how much business may usage based insurance bring ?
- Probably one of the main issues with Big Data is to understand what data are really useful and avoid a too high volume of less relevant data
- Millennials are a special category of clients: they are very fast, have very high expectations and usually are keen to use a limited volume of information, avoiding to get too much into details. Therefore we are now going through a transition period. While older generations are still forming the largest cohorts of clients, we need to prepare fast for the time when Gen Y members will form the majority, and this time is not very far ahead
Filip SKUNCA, Head of Risk Management Department, TRIGLAV osiguranje d.d.
- Risk managers are today fulfilling at least 4 fundamental functions: compliance champion, modelling expert, strategic controller, strategic adviser
- A poll among risk managers of 15 top Croatian insurers showed that their main function is compliance champion, for 30% of them, and strategic adviser, for 29%
- In the past a key risk to corporations was the property damage from fire, nat perils etc. Today the availability of resources is overtaking the top place in the risks scale. Yet, it is largely uninsurable although some initiatives were taken in this regard and we can see a substantial growth in contingency BI coverage limits
- Among Non-physical BI risks, cyber is getting an increasingly important place and requires a great deal of accumulation control
- In Swiss Re's view, deals with parametric triggers and indexed or otherwise fixed sums are preferred transactions
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