Financial advisors are all too familiar with the term “robo-advisor,” but don’t be surprised if the march of the machines begins to enter the insurance space soon
Citing a recent survey conducted by KPMG, Louis Regimbal, an advisory partner with the firm, cautioned insurers that the machines are taking over.
“Where the machines are playing an important role is robo-advisors,” Regimbal told a roomful of industry players gathered for the 24th Annual Insurance Issues Conference in Toronto. “It has gone from relatively no one talking about it a year ago to where you can’t help but talk about it.”
For the uninitiated, Regimbal explained that robo-advising is a fully online process where the client goes through the steps of declaring who they are, what their needs are, and then the algorithm builds a tailored portfolio for their needs.
“It is incredibly simple, it is very inexpensive, and the products are of high quality,” he said. “In the insurance space, no one to my knowledge is really looking at this; but we can probably expect to see some of these robo-advisors deployed down the road soon.”
But the advance of the machines may not happen in La Belle Province, said Regimbal.
“The regulator in Quebec has said that it will not allow robo-advising in that province,” he said. “I am not quite sure what he is saying ‘no’ to, but that is the first shot across the bow.”
The interest in robo-advising came on findings from the same KPMG study examining the greater online engagement among Generation Y, the Millennials, and what that will mean for those working in the insurance space.
Rest assured, says Regimbal, Millennials will want a human component to help in making their insurance decision.
“The insurance professional, an expert, is going to remain a critical component of the process,” he said. “The idea that with the Internet, we’re shoving the intermediary aside – that hasn’t come to pass. When you look at younger generations, their expectations are that they need that expert help.”
“Where the machines are playing an important role is robo-advisors,” Regimbal told a roomful of industry players gathered for the 24th Annual Insurance Issues Conference in Toronto. “It has gone from relatively no one talking about it a year ago to where you can’t help but talk about it.”
For the uninitiated, Regimbal explained that robo-advising is a fully online process where the client goes through the steps of declaring who they are, what their needs are, and then the algorithm builds a tailored portfolio for their needs.
“It is incredibly simple, it is very inexpensive, and the products are of high quality,” he said. “In the insurance space, no one to my knowledge is really looking at this; but we can probably expect to see some of these robo-advisors deployed down the road soon.”
But the advance of the machines may not happen in La Belle Province, said Regimbal.
“The regulator in Quebec has said that it will not allow robo-advising in that province,” he said. “I am not quite sure what he is saying ‘no’ to, but that is the first shot across the bow.”
The interest in robo-advising came on findings from the same KPMG study examining the greater online engagement among Generation Y, the Millennials, and what that will mean for those working in the insurance space.
Rest assured, says Regimbal, Millennials will want a human component to help in making their insurance decision.
“The insurance professional, an expert, is going to remain a critical component of the process,” he said. “The idea that with the Internet, we’re shoving the intermediary aside – that hasn’t come to pass. When you look at younger generations, their expectations are that they need that expert help.”
