BrightRock founders: Our life insurance is not ‘one size fits all’

BrightRock Exco

BrightRock pioneered needs-matched life insurance, particularly for individuals in South Africa. The company was founded by three professionals – all of which were employed in senior positions at Discovery and left to pursue an entrepreneurial calling. These three innovators – Suzanne StevensSchalk Malan and Sean Hanlon – joined the BizNews Power Hour to chat to BizNews founder Alec Hogg about their incredibly successful venture as BrightRock celebrates its 10th birthday.

Suzanne Stevens on why she left Discovery which is such a successful business:

Well, certainly from my perspective, I think that drive to start your own business and to be an entrepreneur in your own right was overwhelming. And certainly at some point, you take your 10,000 hours and you apply them in a space that you can call and carve out as your own. 

Schalk Malan on who convinced two out of the three of them to go off on their own and start BrightRock:

I think there would be different answers to that question – [it] depends on who you ask. No, I’m kidding. I think that’s one of the beautiful parts of our story is that everybody was at the top of their game where they were. [Those] sitting in this room and also even other people who joined us. And that was a good place to actually start from, because it was a wealth of experience. But there’s also that desire, as Suzanne says, to see – can we do it? 

But also for me, more importantly, it was that we believed fundamentally that the products that were currently sold in the South African life insurance industry had some significant room for improvement. And the beauty about what we were thinking wasn’t necessarily something that I think never was thought about. It was actually so obvious. But technology wasn’t really enabling that. And the way of delivering that in the hands of the advisor and that wasn’t there. And we had many discussions over many years. It actually didn’t come with an ‘aha moment’ – (to answer your question in a long winded way).

But what we didn’t realise was [that] what we wanted to achieve would have had to take a complete rethink of the infrastructure, the technology, the way that it’s delivered in the clients hands, the way that it manifests in the client – the end-client, not just the advisor’s hands. I think that just made it such an obvious step – actually, you’ve got to start new, you’ve got to start rethinking every single component. And that’s what we did. Every single aspect of our business was rethought, every single word in the policy document. And I think that’s what really makes the story so absolutely fantastic. 

Sean Hanlon on how BrightRock gets their distribution right in South Africa where there are such big giants who have got such a hold over the distribution channels:

Funnily enough, it’s like the eternal debate between actuaries and salespeople; what comes first – is it the product or is it the distribution? And obviously it’s a combination. But, I mean, you are absolutely spot on. If you don’t get out there and tack your colours to a mast and fundamentally get in front of clients, in front of brokers – nothing happens until someone sells something. For us, it was a massive challenge. You speak about our pasts; you know, we really cut our teeth in some fabulous companies in this country, and without that – I certainly could not have done this.

Because the challenge was not just about a fundamentally different approach to protecting a family’s balance sheet, in essence that’s what life insurance is, but it was changing the way people were selling it, as Schalk alluded to. So, that coupled with the challenge of who’s BrightRock… You know, sound like a diamond mine. And will you be here a year from now? 

Suzanne Stevens on where the name BrightRock came from:

Well, we spent quite a bit of time thinking through what we’d be looking for in a name. So we had established the criteria before we could find a name. And there were a couple of things we were looking for. I mean, we wanted it to carry meaning. We felt that something that was in English was probably preferable so that it was the spoken business language of South Africa. And then very importantly, we wanted it to be something that didn’t have to spell if you heard it, [that] it was something that you could find on the Internet.

We were very conscious of finding a name and a brand that worked in a technically online, digitally enabled world. So there were a couple of things, and then, quite frankly, you have to see what’s available. Because part of when you think it through; there are quite a few of your ideas that you think are genius, and then when you go and look [there are] other geniuses that also thought of those names. 

Schalk Malan on entering an industry that was concretised:

I think looking back ten years, if you just look at our market share now – we’re touching into that 15% in the independent broker market, which I think was hugely disruptive, as you say, in an industry that was quite concretised. You know, it was very solid. 

And if you look at our product, Sean alluded to it, it is a product that tries to achieve a client’s needs – protecting their balance sheet in a fundamentally different way of utilising technology, stripping out waste and getting our clients. I mean, we’ve seen our clients getting the same premium, getting up to double the cover for the same exact need that they then specified from the start – and not just protecting it upfront, but also over time [it is] able to adapt and change. And that has been very disruptive. 

And notwithstanding the fact that – as Sean says, the challenge was [that] with a new product (and it’s quite often the case with established markets), you’ve got to then retrain and you’ve got to manage the change in terms of the sales process. And that comes with its challenges. A very revolutionary, disruptive product does bring those challenges, which I think we as a team appreciated from day one. 

Sean Hanlon on BrightRock’s product not being ‘one size fits all’:

If you look at the movements, the one thing we saw 10 years ago – especially after subprime lending and the massive shift in consumerism – is this constant tuning of the way in which people are changing, the way they’re buying and selling. There is a logical movement all around the world to move away from a ‘one size fits all’ from a commoditised space to an individualised space. And if you look at the way in which we traditionally sell life insurance; we do a financial needs analysis on you – which is a theoretical exercise – then we have to match a product to carry that risk off balance sheet – that family’s risk.

But then it’s a ‘one size fits all’. So my bond and the shaping of my bond, the duration of my children – hopefully they don’t stay too long in my house… they all have different shapes and durations. But there was nothing that could actually match those needs. So you reverted back to price; ‘Well, how much can you afford? There’s a chunk of life cover.’ And there was no relevance between the need and the cover. And the efficiency or the lack of efficiency inside those one dimensional structures really was our call to arms. 

Sean Hanlon on how innovative the incumbents are getting:

I think I don’t think they’ve changed fast enough to be honest. Again; ‘How much can you afford? There’s a chunk of amorphous life cover. You know, what does that mean in a world where people are looking more to – ‘If I want to buy a commodity, I can go online’ you know? But the more sophisticated my portfolio is and this glut of information that I have as a consumer – I’m flighting to advice. So, life assurance is very much product driven. It’s about squeezing advice into a product.

And our view was to say; ‘Let’s platform your advice through a product’. And that was a fundamentally different shift. We had to fundamentally change the way in which life insurance pros were used in the advice process. We’ve seen competitors try and look like that, but the ability of the product to fracture up and to match each need accurately is still not in place. And we are still the world’s only needs-matched insurer.

This article was originally published on BizNews on 3 June 2021. Click here to read the original online version.

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