Technology has been at the heart of how we have adapted to the Covid pandemic and 2020 will go down as the year where globally we adopted new technology at a faster rate and in more far-reaching ways than ever before.
One of the key reasons for that has been consumers seeking reassurance, and technology acting as the facilitator for restoring peace of mind and helping us navigate the ‘new normal’. This is down to its ability to help us find products and services that we would normally access in person. While Covid has impacted many bricks and mortar businesses, the ability of technology to connect people with services has opened up many new opportunities and new customers to a whole range of businesses and organizations.
As an international products and services firm specializing in the insurance and financial sectors, which seeks to provide that security for millions of consumers, CPP has been privy to a birds-eye view of the evolving technology demands across Asia and Europe, and how it is being adopted.
Specifically, we have seen a particular shift in consumer behavior in healthcare, travel and digital payments, as well as a rise in cybersecurity incidents. Here is a snapshot of some of the emerging trends we’ve seen in different markets.
Asia Pacific: HealthTech
Coronavirus presented a unique challenge to healthcare providers across the world, as now more than ever, access to a reliable and trustworthy service has been vital. But like everything else, it presents a heightened risk to those involved if done face to face, therefore it has to be managed remotely as much as possible.
The global healthcare industry was already well on its way to digital transformation before coronavirus hit – more and more people were beginning to access services online, or through phones and mobile devices, and providers were beginning to take advantage of available technology. According to Bain & Co, nearly 50 percent of APAC consumers expected to use digital health tools in the next five years. However, coronavirus has undoubtedly sped this process up. APAC in particular, where accessible and free at the point of need healthcare might not be immediately available, has seen a rapid uptake in HealthTech applications. For instance, digital healthcare platforms in the region saw a 900 percent month-on-month increase in users at the beginning of the outbreak according to Bain. For many, communicating with a doctor through a digital application is the only way they can gain quick and safe access.
China is a prime example of the efficient adoption of digital solutions in healthcare in response to the coronavirus outbreak, as in the early stages of the outbreak the government moved to financing online consultations and insurance claims, along with enabling digital prescription services. This example was shortly followed by Japan and Australia, changing data regulation significantly to allow for telemedicine to take hold.
This strong government support for these online services has resulted in a boom in their use across the region, for instance, Australia extended Medicare coverage to include digital applications and Japan launched its very own government remote health service.
United Kingdom: Cybersecurity
The United Kingdom has been one of the leading markets to adopt a remote workforce at pace, with a large proportion of the population working from home. The Office for National Statistics revealed that 49 percent of employed people had worked from home at some point during the second week of June.
As many workers have migrated to the home office, businesses have faced a range of operational challenges in managing organizational security remotely. Hackers are exploiting the current climate, as evidenced by a recent wave of incidents aimed at those who have been made redundant or furloughed using malicious CV and medical leave forms to spread Trojans, according to CheckPoint. Furthermore, Zscaler acknowledged that since January 2020, they have seen an increase of 30,000 percent in phishing, malicious websites and malware targeting remote users, all relating to Covid-19.
In response to these cyber-attacks, companies had to quickly adapt their business models to allow for remote working, which in many circumstances meant that legacy systems were moved to cloud-based infrastructure. With this shift happening within a matter of days, it was often the case that speed was prioritized over security, leaving exploitable gaps within vital systems. Without the traditional workplace infrastructure in place to support and safeguard vital assets on work laptops and phones, employees were left to fend off digital threats on their own initiative. Vulnerabilities such as these led to some of the most high-profile cyberattacks in recent history, including WannaCry and NotPetya.
Furthermore, many organizations already had significant gaps in their cybersecurity capabilities before lockdown, and therefore entered it with already weak systems. Research carried out in February by Crowe, KYND and the University of Portsmouth revealed that 41.5 percent of companies had at least one service running on out of date software with a further 85 percent of organizations running at least one service with a well-known vulnerability.
As a result, we have seen small and medium enterprises (SMEs) and micro-businesses advance their cybersecurity capabilities across the board, including cyber insurance. GlobalData research revealed that uptake micro-businesses in the UK is now at 17.8 percent, which highlights the growth in awareness around the importance of safeguarding a business from cyber threats but also the gap that remains.
Turkey: Digital payments
Contactless payments and digital banking have, without a doubt, changed the way society today views and works with money. These systems have also been of great use, allowing everyone access to their accounts and financials online, therefore this process has been pushed into full throttle. We have relied increasingly on digital payments for many key transactions, such as online shopping for groceries and essentials as less and less people head out to the shops, and general money management during the coronavirus outbreak.
Using cash has even become a valid health concern, with Valdis Dombrovskis, European Commission vice-president for financial services, even tweeting, “Time to swap your coins for payment cards — safer for containing coronavirus.”
As a result, there has been a significant spike in mobile banking, which with it, has brought about a new dynamic of financial risk due to scams and attacks. Therefore, we must also carefully consider how we counter these challenges. In Turkey especially, there has been an increased focus on the way in which we safeguard mobile payments, which has led to the decision by CPP Turkey to roll out protection cover across contactless payments and NFC.
As a region, it has been a little behind others in terms of digital adoption, with Turkey’s e-commerce section estimated to be worth just around $11.6 billion, according to JP Morgan. However, access to the internet across the country is expected to sharply increase as the government has committed to boosting access to high-speed digital technology, and e-commerce is predicted to grow by 39.7 percent going into 2021. Furthermore, smartphone penetration has sharply risen since 2015 and with it, a desire from mobile phone users to utilize online payments, with 67 percent of users saying they would like make payments from their devices.
This sharp increase in access and mobile technology adoption, has led Turkey to stand out as a key driver in digital payments protection in the region.
The rise of parametric insurance
Coronavirus presented a serious issue for insurance providers, as many of them were unsure if it was covered by their policies and if so how to approach payouts and best serve their customers during the crisis.
However, a technology-enabled approach which has been pioneered in the travel sector, parametric insurance, has received a significant amount of attention as a possible solution for mitigating future challenges across the entire insurance market.
Parametric insurance simply offers a pre-agreed amount of cover based on the probability of a pre-defined triggering event. Enabled by technology, it uses big data to trigger customers’ compensation when an event occurs, rather than after (or in some cases long after) loss is experienced. Since March, our InsurTech business, Blink Parametric, which has pioneered parametric insurance, has received a high degree of inbound enquiries from large insurers across the globe about how to give consumers confidence in booking flights and taking out travel insurance.
It’s already offered as part of policies through the likes of Blue Cross and TuGo in Canada and there we believe that parametric insurance will become a primary driver of growth in the global insurance sector in the coming years. Event-based, indisputable insurance will offer a simpler and more efficient resolution for consumers and partners.
Technology and digital services are by no means a solution to the wider problems we face at the moment, however, they do present an opportunity to bring a little peace of mind to the consumer, and will likely continue to play a vital role in our transition to a life post-Covid.
Sid Mouncey, Group Product & Marketing Director, CPP Group
