Asia's insurance industry is still in the sweet spot in terms of growth markets with positive factors such as big populations, low insurance penetration and rising middle class - "all the macro factors that people have been talking about for the last two decades remain" - said Mr Chris Wei, Global Chairman, Aviva Digital and Executive Chairman, Aviva Asia, in an exclusive interview with Asia Insurance Review.
“Opportunities wise it is about being better, hopefully, than the competition, in spotting opportunities. What that means is doing a better job at responding to customers’ needs, simplifying what is a complex industry and making things easy, and by delivering the best service and value for customers,” he said.
The way Aviva goes about this is to be excellent in the markets it is focused on. “We are choosing to go deep, gain scale and be much more successful in terms of how we operate, compared to planting flags in more geographies,” said Mr Wei.
“The way we think about it is four populous countries: China, Indonesia, Vietnam, and India, and two wealth management centres: Hong Kong and Singapore.”
Non-traditional competition set to rise
In terms of challenges, he sees the regulatory environment getting more complex. Mr Wei, said: “Certainly privacy and data regulations need to be more robust and they will be. I think we are going to see increasing market conduct regulations to make sure customers’ interests are protected. That’s a good thing.”
“At the same time, we are going to see non-traditional competition rise. These would be everything from the ‘Alibabas’ and ‘Tencents’ of the world, to Amazon which is actively looking at insurance, Tesla with InsureMyTesla, and it’s just going to keep growing from there,” he added.
Which is why Mr Wei believes it is necessary to work with the right partners, whether from within or outside of the insurance industry. In 2017, Aviva, Tencent, Hillhouse Capital Group signed a deal aiming to develop an insurance company in Hong Kong focussing on digital insurance. It hopes to be the first insurtech-approved venture in Hong Kong, and aims to launch before the end of first quarter of 2018.
“This joint venture is interesting, it is the coming together of three partners, we have Tencent which everybody knows, not only WeChat but now they have an eWallet and looking to expand that functionality in Hong Kong. We’ve got Hillhouse that I think is a brilliant asset management company and then of course ourselves, we bring the insurance expertise. So it’s three partners coming together to look to disrupt what is a fairly traditional market, and hope to bring a different set of options for Hong Kong consumers,” he said.
On working with partners outside of the insurance industry, Mr Wei said: “I was asked the question before, ‘Are we inviting lions into the den?’. My response is ‘I think we can’t afford not to play with the best’.”
Digital by its very nature is open platform. There are massive ecosystems such as those of Tencent and Google that you have to plug into. The key is to embrace the different ways customers choose to engage and not about forcing insurance down customers’ throat.
“It is about finding opportunities that when they need something, we are there. And we are there ready to serve with simple and effective products,” he said, adding that “If we own enough of the value chain and make it very obvious to customers and partners why they should choose Aviva because of a better experience, then I think naturally they will come to us.”
What is the future of distribution? Mr Chris Wei shares his insight on Asia Advisers Network.