Climate change, poor uptake of insurance and savings products, lack of tax incentives, low incomes and low literacy. There are many concerns in the insurance industry right now, but there are also solutions and a desire to find them. This was one of the conclusions of the Insurance Forum that the PwC consultancy organized this morning at Gulbenkian, in Lisbon, and which included
António Correia, president of PwC; Margarida Corrêa de Aguiar, president of the Insurance and Pension Funds Supervisory Authority (ASF); José Galamba de Oliveira, president of the Portuguese Insurance Association (APS);
André Rodrigues, partner at PwC; Rogério Campos Henriques, CEO of Fidelidade; Pedro Carvalho, CEO of Generali Tranquilidade and Luís Menezes, CEO of the Ageas Portugal group. These are the main conclusions.
1. “Tremendous Protection Gap”
- The first question from Ricardo Costa, who moderated the debate with the CEOs of three of the country’s main insurance companies, had to do with the riots that devastated Lisbon over the last two nights and which led to the destruction of four buses and several cars.
- Goods that are either not insured or that are insured but do not cover situations of this type. Either because they are hard to believe could happen or because the Portuguese tend not to take out insurance or choose policies with a low premium.
- The same goes for climate catastrophes, like a strong storm that rips off a roof or causes a flood. Or when talking about a fire that destroys hectares of land and homes.
- “Everything ends up in insurance, but we would like it to end up more in insurance, for people to be properly protected. There is a tremendous protection gap”, says Rogério Campos Henriques, adding that, in Portugal, coverage of climate events – which are increasingly frequent and extreme – “is very low”: 5%.
Margarida Corrêa de Aguiar, president of the Insurance and Pension Funds Supervisory Authority
Matilde Fieschi
2. Little savings
- This protection “gap” exists in multi-risk insurance, those that can best protect against these climate events, but also in savings products.
- “There are persistent gaps in retirement planning”, says Margarida Corrêa de Aguiar, who adds that this is due to “very low” financial literacy, but also to the fact that we are a low-income country and, therefore, unlikely to take out insurance.
- José Galamba de Oliveira suggests that “innovative products should be created such as the deaccumulation of savings in real estate assets”. Because, he says, “we have families’ savings stored in the walls of their homes.” Most of these houses do not have any insurance other than fire insurance, which is mandatory.
José Galamba de Oliveira, president of the Portuguese Insurance Association
Matilde Fieschi
3. The importance of data
- André Rodrigues believes that the fact that we live in a time when there is increasingly more data available makes insurance management easier, helping to define the risks and premiums to be paid.
- However, you need to understand what data you have because there is still a lot of data worked on in Excel, “which can lead to human errors” and “the more inaccurate the data, the more difficult it is to manage”.
- Furthermore, there also needs to be even more data than there already is and hence the opportunity for Artificial Intelligence. “Data management is not just a technical and information technology issue, but a strategic issue in an insurance company.”
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