FST Media: What are your priorities for the next 12-18 months?
Ward: The changes in regulatory and legislative trends from other jurisdictions, such as Australia, UK and South Africa are likely to find their way to New Zealand, so for us, this places further emphasis on the importance of embedding a risk management framework across all business, supported by a strong culture.
FST Media: What strategies or initiatives will Sovereign introduce in the future to help minimise risk and create value with microfinance?
Ward: Research consistently suggests New Zealanders are under-insured and there are opportunities here for providing more people with access to life and health insurance options. Insurance could be viewed as a luxury for those on lower incomes and our data tells us that there is a higher likelihood of these policies lapsing. We want to provide more people with choices and that will require innovative products that are attractively priced.
FST Media: What are your thoughts on the future of wearable devices in the insurance industry, in terms of the challenges and security risks they pose?
Ward: Wearables present real opportunities for data sharing between the insured and the insurer. To use health insurance as an example, we come to price an individual risk and much of the information we use is based on what has happened, which is then taken as a predictor for the future. The reality is that more of us are likely to develop life-long conditions that are unattractive from a risk pricing perspective, for example, diabetes. If we can use some of the emerging technology to track and monitor how individuals manage their own health, it could allow us to reward those good behaviours. For example, the taking of regular medication reduces the risk of hospitalisation. This becomes a win win situation.
I see similar risks to those we have with other technologies, in particular around protecting data. The protection of personal data will become more strategic, with a clearer need to implement privacy by design into processes and systems. Insurers who demonstrate competence will hopefully encourage the sharing of more information.
FST Media: How significant are data insights managing your risk, finance and compliance requirements?
Ward: We have reduced the number of policy administration systems supported and improved the data quality at each migration. Our data analytics capability is now centralised and resourced to provide more insight across our products and distribution channels. This has enabled us to challenge some of the beliefs that we haveabout our business.
FST Media: How significant of an issue is fraud detection and what are Sovereign’s greatest challenges around regulatory compliance and reporting in the next five years?
Ward: Fraud detection is part of many processes and is managed through our control environment. There is still always a challenge in linking the indicators of fraudulent behaviour, especially if it relates to internal fraud. The key is to provide staff with training to increase their awareness of potential happenings. The regulatory compliance responsibilities for us are increasing. This is expected given the focus of regulators after the global financial crisis and increasingly regulation introduced in one country may now apply to other jurisdictions. If we look at the experiences of financial services companies in other countries, such as the UK, I would expect the cost of non-compliance to be more of an issue. Our challenge is in assessing the specific regulatory requirements against our business and then applying a pragmatic and workable solution.
FST Media: How do you balance supporting a social media presence with the risk of reputational damage?
Ward: We are slowly growing our social media presence and have leveraged others’ experiences in managing the risks here. The important part is we are engaging with people in an open and transparent way, and that means accepting the good with the bad. And all feedback allows us to improve what we do.
FST Media: What are the three most important qualities for a leader?
Ward: Be authentic in your interactions, be courageous with your decisions but most of all be humble with your successes.
FST Media: What has been your greatest career achievement?
Ward: I don’t have one event that stands out. For me it is more the career journey itself and the people I have met along the way. However, I am fortunate enough to be working now with a team of very talented individuals at Sovereign.
FST Media: If you could impart one piece of advice to young professionals entering the financial services sector, what would it be?
Ward: Accept that you will make mistakes and take each as a learning opportunity. Don’t be too hard on yourself.
FST Media: Every leader has a legacy that they wish to be remembered for. What is yours?
Ward: Sovereign is well positioned to take the lead in innovating insurance here in New Zealand and to be part of the leadership team that encourages all New Zealanders to take charge would be a wonderful legacy.