Press Release: Pacis Insurance Acquires Core Insurance Platform from Turnkey Africa

Local Insurer Transforming Business in Line with Growth Plans 
 
Nairobi, Kenya / August 2016  - Pacis Insurance this month announced its acquisition of the TurnQuest Insurance management platform as part of its strategic growth plans. This purchase is a key pillar in unlocking their ability to leverage technology and position themselves as a major competitor in the Kenyan insurance market.


Changing market and customer dynamics are affecting the way people buy and experience insurance demanding a shift in the way insurers do business. In recognition of this Pacis Insurance developed a strategy that will allow them to profitably grow their business in the face of the business challenges posed by technological advances, the advent and growth of social networks, omnipresent regulatory oversight and the opportunity presented by regional economies. Rt. Rev. James Maria Wainaina of the Member of the Board of Directors, Pacis Insurance stated that, “Implementing the TurnQuest solution will go a long way in helping Pacis achieve its business imperatives of growth and sustainability as well as enhance its customer service and product innovation”.

Speaking during the signing, Turnkey Africa’s CEO Kizito Makatiani said “We are honoured that Pacis Insurance chose the TurnQuest Insurance Suite as its primary insurance software and we look forward to a mutually beneficial partnership as we embark on this transformative journey”
He further added that, “The selection of the TurnQuest platform is an endorsement of the depth and breadth of the solution we provide and our expertise in delivering proven, complete and innovative solutions to our customers”.

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ABOUT PACIS INSURANCE
PACIS Insurance Company Limited was incorporated in Kenya in October 2004 and is an initiative of the Catholic Church, with a vision to be the icon of reliability and trustworthiness. Pacis strives to bring peace and comfort to society by ensuring that all clients have peace of mind because they know that in the event of a loss, we will be there for them.

Pacis Insurance underwrites General Insurance risks such as Pacis Motor cover, Clergy covers, Medical Corporate cover, Institutional covers, House Protect, Pacis Golfers, Group Personal Accident cover and Pacis Travel cover.

ABOUT TURNKEY AFRICA LIMITED
Turnkey Africa Limited is a leading Pan-African insurance technology and services provider with a proven record of over 18 years and a footprint of 32 clients across 5 countries in Africa. Turnkey develops, supply’s and manages end-to-end insurance business software solutions and services for the insurance industry.
Turnkey provides, through its core insurance product, TurnQuest Insurance Suite, a comprehensive and integrated set of applications built on a common platform that covers the entire insurance lifecycle, and is augmented by data and analytics capability that gives the insurer a 360-degree view of the business.

Insurers implementing TurnQuest are positioned to reap the benefits of accelerated speed to market for their products and services, respond quickly to regulatory changes, have visibility into the financial processes all leading to an overall increase in operational efficiency to achieving their business imperatives of sustainable growth and profitability.

CONTACT:
For more information, please contact:
Brian Abajah
Business Development Manager
Turnkey Africa Ltd
E: brian@turnkeyafrica.com

Technology is How We Win the Battle against Insurance Fraud

 
By Kizito Makatiani
Last year, the local media highlighted an insurance fraud case where a husband and wife combo decided to fake the husband’s death and the death certificate, then have the wife claim compensation from their insurer. Prior to this story, there had been a case involving 11 individuals who were arrested and arraigned in court, suspected to be part of a fraud ring conspiring to defraud a local insurer of Kshs.15 million by forging the insurer’s medical cards and hospital prescriptions and using them to acquire medical drugs from various health institutions. And then there was the case of an insurance investigator who was arrested and prosecuted in September 2015, accused of pretending to be in a position to influence motor insurance claim payment. Fake deaths, fake accidents, inflated damages, staged accidents, on and on the scams go.

Insurance fraud has been a consistently growing concern for insurers in Kenya with an increasing share of the claims payments done being attributed to the vice. According to the Insurance Regulatory Authority (IRA) Quarter 4 report for 2015, the Insurance Fraud Investigation Unit (IFIU) recorded a total number of 106 cases reported in 2015 which was an increase from the 87 cases reported in 2014. The amount lost increased from Kshs.102.76 million reported in 2014 to Kshs.366.90 million. Of the 106 cases reported, motor underwriting led the list with 42 cases, followed by agent/broker fraud at 25 and medical in third place with 17 cases.

Insurance fraud is prevalent across the entire insurance value chain with the most affected areas being claims and underwriting but as technology evolves and fraudster tactics become more sophisticated, insurers are now increasingly having to deal with other forms of fraud including internal fraud and money laundering as well as the emerging issue of cyber fraud. The KPMG East Africa Insurance Fraud Risk Survey 2015 highlights better assessment of risk at proposal stage and improvement of internal controls as some areas of focus that the region, and Kenya in particular need to concentrate on if the threat of fraud risk is to be curtailed. Also mentioned in the survey report is data analytics.

In the past, insurance companies have relied heavily on fraud investigators to look into suspicious cases and determine whether fraud has occurred. But as our world and technology evolves, we are witnessing a new breed of fraudsters (and fraud rings) using more advanced techniques. This new challenge demands that the insurance industry shifts to improved fraud detection initiatives. Insurers now need to be thinking about new data solutions, workflow streamlining and improved risk management.

To combat fraud more effectively, the ability to collect and analyze huge volumes and varieties of data is essential. Insurers already collect large amounts of data but what many lack is the ability to quickly and systematically evaluate that data in order to identify activities and patterns indicative of potential fraud. There are new technology tools and techniques in the market that can help insurers uncover complex or organized fraud activities using both structured and unstructured data. These include data analytics, predictive modelling, link analysis, automated red flags/business rules, and geographic data mapping.

Predictive modelling enables insurers to review historical fraudulent claims and identify factors and elements that can help prevent future fraud with the main goal being to detect the fraud early enough in the claims process. Link analysis examines relationships among claims, people and transactions thus helping link different players and identify the extent of the relationships between the parties, then giving off data that can be used to define indicators that point to possible fraudulent activity. Automated red flags/business rules can be inbuilt into an insurer’s core IT systems and are instrumental in helping anticipate certain types of suspicious claim activity based on past fraud through the identification of anomalies or irregularities during processing of claims. Geo-mapping can help the insurers evaluate risk and exposure during underwriting and during claims processing. For example, the insurer can now confirm that an incident actually occurred where the customer claims it did.

There are many other tools available in the market, but it is important to note that in order to take full advantage of any or even all of these technological capabilities, insurers must first address legacy technology issues and inefficient processes that have proven to be a great hindrance in the war against fraud. Adapting to modern technology significantly improves the insurer’s operational workflow and also helps manage claims investigations faster and more effectively.

With automated workflow solutions, insurers can be able to track daily activities and expenses and get at-a-glance reports to help flag any suspicious activities. With modern systems, underwriters are also able to confirm information by comparing the applicant reports with information available from other databases and public records online and thus confirm prior coverage, discover undisclosed information and eliminate policy application fraud before it occurs.

Turnkey Africa through its flagship product, TurnQuestTM Insurance Suite provides an integrated set of applications to support the entire insurance lifecycle with inbuilt data and analytics capabilities. TurnQuest’s integrated analytics solution enables insurers to aggregate and easily visualize data to be able to identify suspicious activity that point towards fraud. While fraud identification was handled in a reactive manner in the past, our modern technology combines the power of analytics to detect unknown fraud, both new and unique, along with business rules management to block fraud earlier in the process before it happens or the claim payment is done.

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Kizito Makatiani is the Founder and CEO of Turnkey Africa Ltd.
Twitter: @KizitoMakatiani / LinkedIn: Kizito Makatiani

Bancassurance Not the End of Insurance Agencies

By Brian Abajah
It’s been 10 years since bancassurance made its debut in Kenya with the awarding of the very first insurance agency licence to CBA Bank back in 2004. By definition, bancassurance is simply the offering of insurance products by banks, and as per banking regulations, banks can only act as agents of insurance companies and not underwriters or providers of insurance.

Initially, traditional brokers and agents were not comfortable with the idea of having to share their space with banks. However, brokers seemed to be more for the idea than agents believing that the entry of banks into the insurance sector will increase retail outlets and raise the penetration of insurance products countrywide. The agents on the other hand were not for it, as to them bancassurance represented a loss in placements and commissions.

It does seem these initial fears were justified as current statistics reveal a disruptive shift in the insurance landscape since the entry of bancassurance. According to the Insurance Regulatory Authority, the insurance sector in Kenya has, in the last 5 years, witnessed an increase in dropout of agents and a considerable reduction in new agent registrations. In 2013, there were 593 new registered agents down from 1,085 new agents registered in 2012. Over 1,900 agents dropped out of the industry in 2013 up from 758 agents who dropped out in 2012.

While other factors including financial constraints, pressure to meet targets and low commissions, might have also contributed to the declining numbers, the main threat being alluded to by many agents is bancassurance. Agents also see bancassurance as the main reason why insurers are reviewing commissions and customers are getting a raw deal, with the banks not giving them a choice on which policy to buy and where to do it.
The Insurance Regulatory Authority (IRA) has had to step in following numerous complaints from agents and are coming up with guidelines to help regulate bancassurance business. The draft guidelines, though still in the pipeline, come with stricter rules for the banks with such clauses as: “The bancassurance agent shall not induce or compel a prospect to buy an insurance product of its principal. All prospects shall be allowed to decide out of their own volition, which insurance product they wish to buy and from which insurer.”
But let’s consider the statistics — as per recent estimates, insurance penetration in Kenya stands at 3.4% — the 4th highest in Africa after Mauritius (6%), Namibia (7.2%) and South Africa (14.1%). If one considers this low penetration, then it is prudent to say that there is still a lot of ground to be covered and development of alternative distribution channels such as bancassurance catering to the untapped market segments must be encouraged rather than vilified. Agents, instead of looking at banks as the enemy, should seek ways to work with or alongside them as well as devise ingenious ways to reach the over 96% of the population still untapped. In many countries around the world, India being a great example, the distribution of insurance by banks using their branch network has proven to be a very effective channel of increasing insurance penetration.

Kenya’s insurance market is potentially worth over 2 billion dollars, but only a fraction of this is realized, largely due to lack of awareness as well as other cultural and technological reasons. While bancassurance might initially have been seen to be taking away business from traditional intermediaries, in the long term it has actually expanded the market and created enough business for resilient intermediaries. And even if bancassurance ends up with a commanding market share, the portion for the traditional intermediaries will still be considerably larger compared to the cumulative business they previously managed.

Moreover, traditional intermediaries still have a pivotal role to play especially when it comes to servicing complex insurance products. Banks have limited insurance business experience and are mainly able to handle straightforward products that are simple to explain and service. There is still considerable room in the market for the professional intermediary. Consequently, it makes more sense to put aside the current rivalry and focus on harnessing the collective experience, strategic creativity and innovation of insurers, banks, brokers and agents towards solving our persistent penetration challenge.


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The writer Brian Abajah is the Business Development Manager, Turnkey Africa Ltd