The Old Mutual group is clearly rattled by the exponential growth in online short-term insurance.
Direct online insurance models that cut out brokers appear to be taking market share from traditional broker channels like Mutual & Federal. At the media launch of iWYZE, a partnership between Old Mutual and Mutual & Federal, Old Mutual said it was targeting the mass market which was worth about R25-billion and which is currently under serviced with only around 10% market penetration.
However, they admitted that the group had been losing clients to the direct channels and that this was in part a defensive strategy. The product is to be sold using tech channels like cellphone and internet. For example, potential customers will be able to send a text message to iWYZE and a consultant will call them back.
iWyze is a simple, transparent product with no hidden surprises that insures your valuables like your car and household contents as well as personal liability and building insurance. Its product offering is fairly similar to what many direct insurance providers are providing. However, iWYZE has the advantage of having a very strong brand behind it, in particular Mutual & Federal which as an underwriter has a good reputation in the market for paying out claims.
Some of the features of the product are:
- The insurer will automatically adjust the retail or market value of a vehicle policy on anniversary so that it takes vehicle devaluation into account
- For policies with the minimum excess option, iWYZE will waive excess on their first claim after three claim-free years
- A six month retrenchment premium waiver
- Free road and home emergency service
- A no-claim reward
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