An insurance executive expressed confidence that rising public demand in purchasing protection goods, particularly during…
Increased interest rates don’t immediately affect insurance products.
An official from the London-based Prudential Plc is particular that since the problem is now being addressed, the increased interest rate won’t immediately impact the cost of their insurance products.
Andrew Wong, the chief health officer at Prudential, stated at a conference on Wednesday that inflation spikes, which are the primary cause of global interest rate increases, are not as severe in Asia and Africa as they are in Europe and the United States.
So naturally, we hope that this will only be a short-term problem, he added, adding that “whatever comes up will come down again.”
Wong claimed that by raising their key policy rates, central banks are assisting in addressing the excessive rate of price increases.
According to him, the effects of inflation should only last a short while.
According to Wong, this is why businesses, including insurance companies, need to create solutions with more robust return guarantees because the epidemic raised people’s awareness of the importance of insurance protection.
“Most organizations, including ourselves, are in a better position to come up with some form of higher guarantee return to products as a result,” he added. “This is because of the environment; this is because of the increasing interest rate.”
Wong claimed they had discussed the possibility of offering an incentive program to policyholders who have made few or no claims to date with the authorities.
According to him, the regulators are open to the idea.
“This is what we refer to as the claim-based pricing… It’s really compensation to the policyholders if they maintain good health or take many other preventative measures so that they choose not to incur claims,” he continued.
The president and chief executive officer (CEO) of Pru Life UK, Eng Teng Wong, stated during the same conference that these cost-effective products are intended to encourage more people to acquire insurance coverage and thereby help enhance financial inclusion in the nation.
Given the advantages it will provide policyholders, he claimed that these are competitive offerings.
He said that this is anticipated to increase the country’s insurance penetration, which is currently low by regional standards, accounting for only about 1.7% of the overall population.
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