Apple, Amazon, Microsoft, Google, and Facebook occupy the top five places in the 2020 ranking established by Interbrand, while the leading insurer Allianz trails far behind in the 39th position, a report has shown.
According to Atlas magazine, the internet giants are enjoying a higher profile than insurers.
Today, the visibility of an insurer across the world cannot be achieved without the use of new technologies. It is impossible to get into every corner of the globe as GAFAMs and similar companies do. GAFAMs are the initials of Google,Apple, Facebook, Amazon, and Microsoft.
This situation has made it look like the internet giants and insurance companies are on a collision course, with the former standing as young companies, some of them only 20 years old, while the latter being sometimes over 100 years old.
GAFAMs are flexible, act quickly, and bet on the future whereas insurers are conservative, act cautiously, and envy the capacities of large technological companies tocollect data.
Starting out with the initial focus limited to a single domain, GAFAMs have gradually turned to broader activities to increase their scope of operations.Thus, for almost adecade, Amazon, Apple and Google, to name a few, have been looking for new outlets corresponding to their phenomenal capacity to collect and analyse datagathered from the web. A position that, in the economy, gives them an unparalleled competitive advantage.
The GAFAMs recently made a name in financial services with their online payment solutions. Apple Pay, Google Pay, Amazon Pay, and Facebook Pay, are using their technological know-how to diversify and penetrate markets that they are radically transforming. For example, they are gradually turning to insurance to offer revolutionary solutions, particularly in the health, motor, and homeowner’s insurance sectors.
For the GAFAMs, insurance is a product, “almost” like any other, that can be distributed via the Internet.
GAFAMs have succeeded where companies have failed to date, holding a near-monopoly intheir field of activity.
Google is the most-used search engine in the world. It accounts for almost 90 per cent of the solicitations on the internet. In addition, the YouTube channel, bought in 2006, is viewed more than a billion times a day, which makes it by far the most followed TV channel in the world.
Furthermore, Facebook is a social network visited by 2.7 billion users monthly, Microsoft’s computer system operating tools are installed on nearly 88 per cent of computers. Amazon has a market share of nearly 50 per cent of e-commerce in the United States. It is the undisputed world leader in this field; while Apple controls 11.8 per cent of the global smartphone market and 29.2 per cent of thetablet market.
GAFAM giant companies have taken advantage of a market that goes far beyond their national borders and extends to the entire earth. Everyone on the planet is a potential customer of GAFAMs. In this context of quasi-monopoly, competition is hardly standing.
Access to the services offered by these technology giants is facilitated by a multitude of easy-to-use connection networks: applications via smartphones and tablets orcomputers connected to the Internet.
This globalised, easy-to-use distribution network contrasts with that of insurancecompanies. The latter, due to legislative constraints, have difficulty indeveloping their brand throughout the world.
In Nigeria, the Commissioner for Insurance, Sunday Olorundare Thomas, has been urging insurance firms in the country to brace against the challenges of Artificial Intelligence (AI).
He stated that in technology, since the advent of COVID-19 pandemic, the way in which businesses are conducted have significantly changed; with the major focus on the use of technology to ease activities.
He said the commission has been working to boost access to insurance through the effective deployment of technology.
He said: “Forus at the commission, we have been working to boost access to insurance through effective deployment of technology. Our portal has been launched andeffectively deployed.
“Innovation will be the key to sustenance of the industry and make insurance services seamless by leveraging technology, which drives applications like Insurtech, FinTech, blockchain, data analytics, IoTs, etc.
“We must all work together to explore all possible means to take insurance to a new levelthat will enhance our contribution to the nation’s economy,” he said.
The Chairman, Heirs Holdings, Mr. Tony Elumelu, in a keynote remark at an insurance brokers’ forum, said to remain relevant in the modern business arena, the insurance industry, must embrace technology fully.
He urged operators to embrace technology and digital adoption and drive clean data for the industry, stressing that it is not a one-person job.
Elumelu added that the industry could benefit from innovation across all phases of the service. For this to happen, there was the need to reward and incentivise innovation across the industry.
“The industry must also benchmark against global trends. Innovation and disruptive practices cannot occur if we do not broaden our thinking.
“Trying to make profits from existing lines is not going to deepen insurance penetration; rather we must look at the blue ocean opportunities. This is something I ask the management of the insurance companies to constantly think of in product development and deployment,” he added.
