Sagicor Financial : World Newsletter Sep 2016

Greetings and welcome to the refreshed Sagicor World Group newsletter, with lots of news on what is happening within the Sagicor Group of Companies and within our industry. In this edition, we celebrate some of our top Awardees, highlight innovative product launches such as drivePal at Sagicor General Insurance, and look at what is happening within the global insurance industry and some of the challenges it is facing. Then, we share details on some of our corporate social responsibility programmes in Barbados, Jamaica, trinidad and tobago and in the United States of America. Sagicor World has it all.

This year continues to be a special one, as we celebrate and recognise our 175th Anniversary of providing Wise financial thinking for Life.

It has been a pleasure participating in, and hearing about so many of the events already taken place during this year under the umbrella of our Anniversary. the overall message of 175 years of heritage will go a long way in reinforcing that our experience will continue to inform our future and that our customers may all benefit from the confidence that comes from 175 years of financial stability and strength.

This year is flying by at an incredible pace, and the end of our third Quarter is literally around the corner. I want to take this opportunity to thank each of you for your continued efforts and commitment to making many more Sagicor milestones. As we move into the last few months of our financial year, I encourage you all to remain focused on your individual and team goals, and on our vision, "to be a great company committed to improving the lives of the people in the communities in which we operate." this means giving of your best and overcoming all obstacles and challenges that may arise, and with your help, we can make 2016 another successful year for the Sagicor Group of Companies.

All that's left for me to say now is thank you. thank you for reading this, and supporting what we expect to be a quarterly source of information and insight into our Sagicor World.

regards, Sagicor World

Barbados | Antigua | Anguilla | Aruba | Bahamas | Belize | Cayman Islands | Costa rica | Curaçao | dominica | Grenada Guyana | haiti | Jamaica | montserrat | Panama | St Kitts | St Lucia | St maarten | St Vincent | trinidad & tobago | USA

INSURANCE INDUSTRY OUTLOOK

DRIVEPAL - A FIRST

In the CARIBBEAN

CLASSIC SERVICES FOR CLASSIC CARS

RAISING KIDS' SPIRITS WITH

SAGICOR FOUNDATION LAUNCHES ITS 2016 ADOPT-A-SCHOOL

PROGRAMME 5-6

SAGICOR SUPPORTShAbItAt fOR humAnIty p6

Stem TACKLING

REAL-WORLD CHALLENGES

THE WAY WE WORKED

SAGICOR GROUP AWARDEES

CLICK on A FEATURED ARTICLE BE TAKEN TO ITS PAGE.

Barbados | Antigua | Anguilla | Aruba | Bahamas | Belize | Cayman Islands | Costa rica | Curaçao | dominica | Grenada Guyana | haiti | Jamaica | montserrat | Panama | St Kitts | St Lucia | St maarten | St Vincent | trinidad & tobago | USA

SAGICOR WORLD September 2016

INSURANCE INDUSTRY OUTLOOK

AFTER 175 YEARS OF SERVING OUR CUSTOMER S WITH TR IED AND TE STED F INANCIAL WISDOM AND SOUND EX PERIENCE, WE FIND O URSELVES OPERATING IN AN INDUSTRY TH AT IS NO W TELLING US TH AT WE NEED TO CHANGE HOW WE DO BUSINESS.

This should be no surprise to us, especially when we consider that we have been operating in depressed markets for some time; large insurance companies across the world have recently folded, while others are on

the brink of collapse, and the Brexit referendum immediately resulted in insurance shares taking a spin. Closer to home on Caribbean shores, the Clico debacle is still very much at the forefront of people's minds.

INDUSTRY OUTLOOK

A recentDeloitte Insurance IndustryOutlook, "Insurers on the Brink," describes a very volatile global environment where many insurance companies are facing existential challenges to the foundation of their value proposition.Rising customer expectations for personalized products and services in an increasingly connected world and macro-shifts in the economy and culture that threaten to dismantle traditional business models were cited as some of the industry's biggest challenges.

The Outlook forecasted that, "The pace of change will likely accelerate over the next few years, fueled in large part by technological transformations such as the Internet ofThings (IoT)1, blockchain-based infrastructure options2, and mobility applications, as well as general open-mindedness on the part of regulators and consumers toward new sources of coverage and emerging methods of sharing risk.

Worldwide, the industry is learning that it is not immune to the changing buying behaviours and preferences of customers, and that time is crucial.

Time to do things outside of business hours is tight, and when we leave work, we try to do things to create a better work-life balance. So things like insurance tend to be organised

outside of regular working hours, after the customer has gained access to good quality information, usually available 24/7 online.This has resulted in changes to the buying habits of customers.

The nature of relationships is changing, with more females coming through who are running their own businesses, the main breadwinner or head of the household, with different expectations to what have been traditional relationships. A World Bank study estimates that by 2030, the insurance industry is expected to receive up to US$1.7 trillion premium contributions from women alone, half of which will come from emerging economies.

A large section of our markets are millennials, or GenerationY, born between 1982 and sometime in the early 2000's.This generation of customers is far more tech savvy.They have grown up on the internet; they click for everything - including their insuranceO. ur customers are evolving, and technology and digital are playing an important role in that transition.

A recent New York Times' article concisely describes how insurance companies are struggling to get to grips with a low interest rate economy and its affect on universal life policies, policies that include an investment component that accumulates cash when interest rates are high. Interest rates around the world are nearing zero, and, in some places, have turned negative.This situation is, "contributing to a crisis moment for a business once considered the bedrock of financial stability and an industry that supports the retirement of millions." Very low interest rates are excellent for homebuyers and borrowers, who can get reasonably cheap loans, but they are disastrous for insurers, whose assets are heavily invested in bonds with earnings that are being squeezed.

Insurers that sell policies that run for decades are now facing a twofold challenge: how will they fund policies sold way-back-when their actuaries could not envision a world of interest rates below 8%, and what do they sell now, when the same actuaries do not see an appreciable rise in rates happening anytime soon?

Policyholders, who purchased life policies in the 1980s and 1990s, are in a difficult position, because they are paying as much as 6 times more premium than before, just in order to maintain coverage and a death benefit payout.

They also know that the only beneficiary to benefit from a lapsed policy is the insurance company who will keep years of already-paid premiums.

Therefore, here we have the economic challenges negatively affecting our insurance customers, increased customer expectations - driven by the customer, and an industry forecast driven by technology for changing customers' needs. Newsflash - All signs are pointing in the direction of the customer, and this is why the industry needs to take a good look at itself.

Historically, insurers have not been quick to adopt major changes in the way they do business, but the problem is that the speed of technology has caused major disruption, much faster than the strategic cycles of insurance companies. In the long term, the consequences to insurers not willing to recognise their real customers and adapting to them are costlTy.here is no choice but to change, when we consider how fast our customers are adopting new ways of doing business.

THE FUTURE

So where do insurers go from here? IvoFurrer, Chief ExecutiveOfficer of Swiss Life said, "We have been in the insurance business for more than 150

years, and now is the time for change."Many throughout the global insurance industry echoMr Furrer's comment, including Sagicor, which is already way into a large-scale business improvement strategy.

Insurers are waking up to the call to find ways to stay relevant and continue to add value. A crucial move to make is to redefine customer relationships and customer journeys.From there, insurers have to make best use of all the available channels to access and engage customersT.hey have to remodel and change their business to reflect their customers and markets, and embrace the same technologies that their clients are embracing, remembering that insurance customers are not only bench marking the experience they are having online with other insurance companies, but they are bench marking insurance against all the other industries. Insurers need to step back and look at the industry as if they were contemplating new entry to the insurance market or starting from scratch, similar to the situation globally, where new entrants have come onto the scene and caused some disruption.

When Sagicor first opened its doors in 1804, its goal was to satisfy a dire need for an indigenous financial services industry to serve a Caribbean community, whenEurope had lost interest in our regionF. rom inception, our key focus has been about our customers and, by extension, our communities. Making, accepting, and embracing change and being innovative is not new to Sagicor. We have been doing it successfully for 175 years.Over time, as our customers' needs have changed, we have also changed.Our future now lies in our ability to ensure that we continue to evolve innovatively as we look toward our bicentenary.

By CeCe McDermott

1the Internet of Things (IoT) - the internetworking of physical devices, vehicles, buildings and other items embedded with electronics, software, sensors, actuators, and network connectivity that enable these objects to collect and exchange data.

2blockchain-based infrastructure - A blockchain is known by many as the technology underpinning the bitcoin digital currency. It is a data structure that makes it possible to create a digital ledger of transactions and share it among a distributed network of computers.

Barbados | Antigua | Anguilla | Aruba | Bahamas | Belize | Cayman Islands | CostaRica | Curaçao | Dominica | Grenada Guyana | Haiti | Jamaica | Montserrat | Panama | St Kitts | St Lucia | St Maarten | St Vincent | Trinidad & Tobago | USA

SAGICOR WORLD September 2016

A FIRST IN THE CARIBBEAN

SAGICOR GENERAL INSURANCE OFFICIALLY LAUNCHES NEW CLASSIC & RETRO CAR POLICY FOR CLASSIC CAR OWNERS

The motor-insurance market has been responding positively to Sagicor General's new drivePal product which features enhanced road safety and savings as its major selling points.

President and Chief executive of Sagicor General Insurance, david Alleyne said Barbadians were quickly recognising the real benefits and savings, of up to 35 per cent in some areas, that drivePal was bringing to the market.

"We have had significant response through all means of engagement... the inquiries and comments are tremendously positive and

owners of classic cars in Barbados and the Caribbean now have a

special insurance product to assist them in protecting their assets, which could be worth millions of dollars.

Sagicor General Insurance officially launched a new Classic & retro Car Policy during a media conference at their haggatt hall office, attended by insurance executives and

encouraging," he said.

drivePal features an inconspicuous telematics data collection

1967 honda S800 Convertible, owned by dr. Charles edwards.

classic-car owners.

device, which is attached to vehicles and allows owners and insurers to monitor the driving habits of those signed up to the programme.

road traffic regulators, insurance executives and road safety advocates have been praising the product as one with great potential to reduce vehicular accidents and positively transform the motor insurance industry in Barbados.

In further explaining how drivePal customers are able to benefit

in an industry that generally penalises everyone for the poor driving of individuals, Alleyne disclosed that it was customary in the market for all costs to go into a pool and the only distinguishing factor

was the no-claim discount.

"With Sagicor General, savings to drivePal policy holders will be in addition to any other discounts which we already offer - such as no-claim, multi-vehicle, and multi-policy discounts. drivePal allows you to distinguish yourself by responsible driving, which is a revolutionary way of managing the perceived high risk groups," he said.

traditional ratings in the insurance market are loaded in relation to perceived risk factors and among those perceived as high-risk groups are young and inexperienced drivers and those with recent accidents.

As much as Sagicor General was seeking to strengthen its position in the market with new products, the President said his company's investment in bringing drivePal to the market was also driven by its commitment to wise financial thinking on behalf of its policy holders and also by a corporate imperative to promote safer road-usage.

Sagicor General, the President said, has been revolutionising the market and was already a game changer in the insurance industry when it came to negotiating settlements between claimants and insurers in the event of vehicular accidents.

the company has gone further than other competitors in the industry by establishing a six-member medical panel, with a high level of expertise, to negotiate and settle claims in a timely manner.

President of Sagicor General, david Alleyne, said the new product covering these prized assets was brought to the market after months of discussions with executives and members of two local clubs - the Barbados Association of Classic Cars and the retro & Classic Car Association.

"As part of our mission, we continue to explore and develop innovative products and services based on the needs of the communities in which we operate... this is precisely what led to the creation of our newest product, the Classic & retro Car Policy," he said.

According to mark Blakeley, Sagicor General's Vice-President of Business development and marketing, the new policy provides comprehensive cover regardless of the age of vehicles and also damage cover to owners to protect their investments. he said the policies were of agreed value and provided owners with a sense of certainty and security regarding the value of their classic vehicles.

With the two Clubs in Barbados boasting 200 members between them, Blakeley further said that the response from the clubs had influenced the contents of the policy, which was designed to provide solutions to their challenges. Both President of the Barbados Association of Classic Cars, George Ullyett, and President of the retro & Classic Car Association, Adrian mayers, praised Sagicor General for responding to their needs.

"this a ground-breaking step... Sagicor General did their homework by listening to owners of classic and retro cars and have tailored a product to suit their needs," said mayers.

Ullyett, in welcoming the new policy, explained that after having spent hundreds of thousands of dollars restoring vehicles, it had been very difficult for owners of classic cars to get them insured. "So we are very happy that Sagicor General was able to come up with this type of policy."

Barbados | Antigua | Anguilla | Aruba | Bahamas | Belize | Cayman Islands | Costa rica | Curaçao | dominica | Grenada Guyana | haiti | Jamaica | montserrat | Panama | St Kitts | St Lucia | St maarten | St Vincent | trinidad & tobago | USA