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Towards a strategic plan for insurance education in South Africa Professionalism through education

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Towards a strategic plan for insurance education in South Africa ... Robert W Vivian. Professor Finance & Insurance. University of the Witwatersrand ... – PowerPoint PPT presentation

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Title: Towards a strategic plan for insurance education in South Africa Professionalism through education


1
Towards a strategic plan for insurance education
in South AfricaProfessionalism through education
  • Robert W Vivian
  • Professor Finance Insurance
  • University of the Witwatersrand

2
Strategic plan or long range plan Macro -
developments
  • Advent of mass higher education large classes
    1 000 first year students
  • This results in an increasing number of graduates
    into the industry
  • Foreseeable future all senior management will be
    graduates (already the case MBAs, CAs,
    actuaries etc)
  • Economic nature of society is changing
  • It is realised that we are in the post-communist
    age
  • It is not realised that we are also in the
    post-capitalist, Post free-market age
  • We are now in the managerial age
  • Massive worldwide companies which need to be
    managed. This results in impersonal, systems
    based, black box decision making.
  • Managerial skills there are no specific
    discipline skills required (maybe financial)
  • However technical skills are indispensible, but
    not taken seriously by management
  • Technical skills not perceived to be important or
    appreciated
  • Technical skills in the industry probably the
    lowest ever
  • Eskom may well be an example. It is easier to
    appoint mangers but can it work without
    engineers?

3
SA Financial market
  • Historically one of the best in the world
  • SA Banks shortest clearing time in the world
  • Long-term market innovative, dread diseases
    cover
  • Short-term market innovative, Multi-peril
    policies, monthly premiums, debit order payment
  • Insurance education has been provided by the
    industry via the educational associations CII
    IISA
  • Insurance industry is generally quite a happy
    family
  • Inseta - maintaining the SA tradition - probably
    the best operating Seta in South Africa

4
Education involves layers of education and
training
  • Medical profession there are
  • Nurses
  • Doctors
  • Specialists
  • Engineering there are
  • Labourers
  • Artisans
  • Technicians
  • Engineers
  • Consultants
  • Insurance
  • In designing the educational system it must be
    remembered that different layers exist and the
    system designed accordingly

5
The business of insurance
  • The business of insurance involved two pillars
  • Insurance resulting in underwriting (or insurance
    proper) activities and profits
  • Investment resulting in investment of assets and
    investment profits

6
Insurance functions
  • Education and training must recognise the
    numerous functions which exist in the industry
  • Insurers, intermediaries
  • Underwriting, claims, marketing, contact
  • etc

7
Current problem with insurance education in South
Africa
  • It lacks a holistic plan
  • It has all the parts but it is not clear that
    these come correctly together in an efficient
    manner to produce the right outcomes

8
Objective of education
  • Assemble the appropriate body of knowledge
  • Disseminate that knowledge in the appropriate
    manner at the appropriate level

9
Education
  • Traditional education providers
  • Universities
  • Technikon type of education
  • Industry training (IISA)
  • Specific training
  • Training for specific occupational functions
  • Motor insurance underwriting
  • Motor claims
  • Etc
  • In practice specific training is almost always
    confused with general training
  • Continuing education

10
General education - undergraduate
  • Not an end in itself but an education on how to
    run a business
  • Accounting I (II) (III)
  • Law I (II) (III)
  • Economics I (II) (III)
  • Mathematics and statistics (I)
  • Information systems and computer literacy ?
  • Insurance and risk management (II) (III)
  • Business Finance (II) (III)
  • Marketing (II) (III)
  • Human Resource Management (II) (III)
  • Insurance is only 2 out of 10 courses (5 3 2)

11
Towards a holistic model
  • Modular approach (a systematic application of
    unit standards)
  • At universities (undergraduate)
  • A general education
  • Plus specific insurance modules
  • In industry specific training
  • Specific insurance modules
  • In industry general specific insurance education
  • Specialising in insurance
  • General modules specific insurance modules
  • Specialising in business
  • General business modules General insurance
    modules Specific insurance modules (insurance
    management modules)

12
The assembled body of knowledge
  • The general body of insurance knowledge does not
    exist in South Africa
  • In fact it has never existed in South Africa, it
    was developed in the UK and converted to SA use
  • Because of the age of managerialism it is fast
    disappearing world wide
  • This lead to confusion no end, examples
  • If a husband dies, does the wife get the proceeds
    of the insurance policy?
  • If a bank owns the equipment does the bank or the
    insured get paid?
  • Modern insurance legislation is incomprehensible
    the blind leading the blind
  • The body of insurance knowledge needs to be
    created

13
The way forward
  • Take all the parts and put them into their
    correct place not an easy thing to do
  • Define the modules
  • Assemble the body of knowledge (will take years
    but a start must be made)
  • A recognising body, IISA, to give the stamp of
    acceptance
  • Define the plan and stick to it (also not easy to
    do)
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