AIA on a mission to break the cycle of under-insurance

Step inside the boardroom at AIA and you will find it at the top of the Exco agenda.  Pop into the Operations hub and you will see evidence of it in the business decisions being made. Take a seat in the staffroom and you will hear it in passing conversations. A belief that the cycle of under-insurance can be broken appears to have taken hold.

By all accounts, this is a far cry from the AIA of old and fighting talk from a key player in the New Zealand life insurance industry. Can it be done? "Absolutely," says Besant "and we have a mandate to do it. At around 2% of GDP, our insurance penetration remains one of the lowest in the OECD. Not to mention that each year there is not a lot of new business, and premium increases are primarily CPI and age-related. With the diversity of the New Zealand population now beginning to outgrow the range of our collective solutions and access points, as an industry we clearly have much more to gain than we have to lose."

Known for his optimism, Besant goes on to describe the silver lining that is available to anyone who really wants it. "From where I stand the market is wide open, both for insurers and advisers. With the changing face of New Zealand, we have more communities to reach than ever before. New channels and products that provide entry points into the market will fuel rather than constrain traditional advice models. And with technology there is still so much more we can do for existing customers. It's exciting."

Nevertheless, the issue of under-insurance is not new and yet to be solved.  Besant is critical of the industry response to date which he says has largely focused on sizing the problem, pointing to existing product solutions and putting the ball back in the court of consumers.  What will AIA do that is different?