Read Full Magazine Here. The application of digital technology is transforming personal lines insurance. Policies are bought on mobile phones, motor insurance is priced using telematics, health conditions are managed by apps, sensors detect water leaks before a customer has noticed, InsurTech companies are innovating constantly – and the COVID-19 pandemic has accelerated the shift towards digital lifestyles.
The history of Commercial Insurance is related to that of the Zaccar’s, a family whose life and path have been strongly marked by the political fluctuations of Middle East contemporary history. Following the nationalisation of the insurance sector in Egypt where he set up Alexandria Insurance, the late Roger Zaccar returned to Lebanon. It was in 1962 that he set up Commercial Insurance in Beirut.
The management of a good family man, Commercial, which is one of the country's oldest companies, managed to push through the rocky times of the Lebanese war which lasted from 1975 to 1992. It is still doing so during this tough era that Lebanon is witnessing.
Passed on from father to son for three generations, the company's management is looking for the ideal partner that would eventually allow it to reach the critical size and weight on the market before considering a possible regional development.
Established in 1962 by late Roger Zaccar, Commercial Insurance offers both life and non-life insurance services. It has prospered since with a sound financial track record marked by personalized services and comprehensive coverage.
Commercial Insurance has built a strong reputation by consistently fulfilling its engagements and continuously innovating to meet ever evolving client needs. It has offered uninterrupted services to all clients in Lebanon and abroad even during critical situations. Our team composed of highly qualified professionals work hard to deliver tailored insurance solutions for all risks.
Commercial Insurance operates from its headquarters in Beirut Downtown-Starco Center and is supported by offices located in Zouk Mikael.
Commercial is committed to its community and environment. Its corporate social responsibility programs target the disfavored of society without any discrimination, and the company’s green initiatives aim at preserving and embellishing the environment. Commercial is part of the UN global compact initiative.
In 2022, Commercial Insurance celebrates its 60th anniversary. Today, Roger Zaccar is looking forward to expanding the operations into new geographies and celebrate the next 50 years with the new ingenious generation.
Commercial Insurance accumulates 60 years of experience in both life and non life insurances. Its personalized customer service has been reflected in its renewal ratio which is one of the highest in the market.
Commercial Insurance is the Lebanese leader in a wide variety of insurance products ranging from life insurance to medical, property, automotive, and innovative products.
Commercial Insurance was selected to be a corporate governance case study by the International Finance Corporation (IFC) & Lebanese Transparent Agency (LTA).
Its renowned reputation relies on its financial strength which positions Commercial Insurance as one of the most solvent and liquid companies.
Roger is the Chief Executive Officer and board member of Commercial Insurance Company S.A.L. which offers both life and non-life insurance services and he is also the Founder / CEO of Comin.
His career started as an intern in 1997 and since, he has acquired a diverse set of skills and expertise within the company. He alternatively worked in the sales department developing relationships with agents, brokers and direct clients. He designed the marketing strategy providing the company with focus and targeted exposure. He then took the lead in innovating and developing new niche products. All the way, he was in charge of various administrative tasks which included design of communication tools, supplier and third-party negotiations, and selecting and installing new software. He currently leads the development of the company with new product offerings and a special focus on geographical expansion
Roger has been knighted by the sovereign state of the order of Malta. He also served as board member and treasurer of Oum El Nour (a non-profit non-governmental institution helping individuals overcome their addiction) from 2012 till 2018, and Junior Achievement Lebanon (Injaz) from 2004 till 2008, is a founding member of the Family Business Network Levant Chapter and a steering committee member of the LAU Lebanese Family Business Network. He was a steering committee member of Agora and Saint Joseph School alumni where he held the post of treasurer. He also is a member of the Lebanese Italian chamber, a member of MEREF and the Beirut Traders Association.
Previously, he was the chairman of the fire committee at the Association of Lebanese Insurance Companies.
Roger holds a bachelor in business administration from Notre Dame University and is a Harvard Alumni graduate.
In an exclusive interview with BUSINESS LIFE, the reputed Roger Zaccar offers detailed insights on how the application of digital technology is transforming personal lines insurance. Policies are bought on mobile phones, motor insurance is priced using telematics, health conditions are managed by apps, sensors detect water leaks before a customer has noticed, InsurTech companies are innovating constantly – and the COVID-19 pandemic has accelerated the shift towards digital lifestyles.
BL: Digital insurance – what do consumers want? How did personal insurance develop in the context of the COVID-19 pandemic?
Roger Zaccar: The pandemic was another hit for the insurance industry following the October 2019 revolution in Lebanon. While most medical insurance policy clearly excluded coverage for pandemics, the Lebanese government imposed insurance companies to cover medical expenses following Covid-19.
Commercial Insurance was one of the first insurance companies to extend coverage to our policyholders well before the government’s decision. We also created the first standalone Covid-19 insurance policy to cover hospitalization expenses. When the airport resumed activities in July 2020, Commercial Insurance was the first Lebanese insurance company to provide travel insurance with Covid-19 coverage to inbound passengers as per the Ministerial decision taken that every entering passenger should have such an insurance policy.
BL: What was the impact of lockdowns and how consumers contacted insurance providers when face-to-face communication became impossible?
Roger Zaccar: We started working on the possibility of remote work at Commercial Insurance since 2018, well before the pandemic forced us to do so. As such, our employees were able to work from home normally using processes that were already set in place.
On the other hand, the insurance sector was exempt from the total lockdown given our role in the healthcare sector, which allowed us to have a limited presence at our offices to continue servicing clients. Customers could inquire about new or existing policies by contacting our 24/7 call center as well.
BL: Lockdowns have accelerated the trend towards buying online, did consumers trust the major tech brands they regularly used during lockdowns more than their insurance providers?
Roger Zaccar: The Lebanese consumers always had a certain resistance to buying online. This goes back to the habit of visiting the neighborhood store, mechanic, etc. We all have our “trusted” local providers.
Lebanon does not have any major tech brand present, as such, each client figured out his/her own way of getting access to insurance, either via their existing broker, or via companies that allowed for online insurance purchase.
BL: What are the factors that shape the digital insurance environment such as the extent to which consumers have virtual assistants?
Roger Zaccar: Insurance is considered complicated to purchase online. This misconception may be due to the general conditions which clients tend not read, or intermediaries who do not properly explain what is, and what isn’t, covered to the customer. As such, an assistant, is needed in the digital insurance environment. Digital insurance customers’ expectations are also very different in the sense that the service level needed is much higher than traditional business. A client who pays for an insurance policy online, expects to receive the policy immediately. This immediate expected action also extends to all areas such as customer support and claims.
BL: What are your comments on consumers’ attitudes to sharing personal data, their willingness to make claims online, and their awareness of developments such as all-in-one insurance policies?
Roger Zaccar: All new developments face resistance from customers. The insurance industry historically had customers’ personal data; the only difference is how the data is collected. Whether pen and paper proposal forms or digital forms, insurance companies require the same amount of data to issue and service policies.
With all the changes in our lifestyles, it is only normal for our industry to have new data requirements for policy issuance and management. Once customers understand that sharing data is for their personal benefit, I believe the insurance industry will have a very big shift and become much more customer centric.
BL: What are the digital innovations that Commercial came up with during the past few years?
Roger Zaccar: Commercial Insurance is one of, if not the only, company to allow for a full online policy issuance process via our partner, Comin Insurance. Over the past few years, we have tailored our insurance offering to match customers’ needs, and to allow for a fully online policy issuance process.
BL: Digital insurance – what do consumers want? 11- How Are consumers Using Digital Insurance, and What Do They want from it?
Roger Zaccar: Consumers behavior is shifting towards purchasing their insurances anywhere, anytime. They look for a reliable insurance company that is willing to provide competitive prices.
BL: What are your comments on customers’ buying behaviour for car / auto and home insurance?
Roger Zaccar: With all the economic and political instability in Lebanon, insurance has unfortunately become a luxury to some. We have seen a decline in coverages purchased by clients, often opting to basic insurance covers compared to the comprehensive policies they used to purchase before.
BL: What can you say on the use of telematics in car insurance?
Roger Zaccar: There are interesting advances made in this area, however MENA customers are not yet ready to adopt such technologies given that it is not clear what the insurance company will do with this data, and how it may affect the renewal and claims experience.
BL: What are your insights on consumer attitudes and behaviour towards health insurance, focusing on the importance of digital technology?
Roger Zaccar: Customers are ever more aware of their health situation and are taking more and more care of themselves to live healthily as long as possible. Insurance companies have a very important role in allowing customers access to healthcare in case of illness, however, with digitization, insurance companies may become more involved in keeping customers healthy, and preventing illnesses, instead of simply paying hospitalization expenses.
BL: How the recent increase in interest rates will impact the insurance business?
Roger Zaccar: Insurance companies invest in safe assets such as long-term bonds and fixed-income investments, to ensure proper liquidity for claims payments. With increased interest rates, the return from the mentioned investments decreases, leading to lower profitability for the insurance sector.
BL: How the fluctuations in oil prices impact your customers appetite to buy insurance policies?
Roger Zaccar: Similar to the impact of Covid-19 lockdowns whereby customers drove their cars less than usual, and as such, purchased less insurance policies. With the increase in oil prices, we can expect a similar trend of less people driving their cars, thus purchasing less motor insurance policies, or “downgrading” their insurance policies to only purchase the compulsory ones for their vehicles as to remain road legal.
BL: What are your comments on Lebanon’s insurance regulations?
Roger Zaccar: The insurance sector was and remains the second biggest financial industry in Lebanon, and worldwide. It is important to understand that insurance provides, now more than ever, a financial cushion to customers following unforeseen circumstances. The ICC is doing an excellent job, and any regulations are welcome as they help reaffirm our clients’ trust in our industry.
BL: Is the present economic and political challenges impacting negatively on the insurance companies?
Roger Zaccar: Given that insurance companies carry a local risk, our industry is intertwined with the challenges including the economic collapse and political unrest. Instead of working towards improving our offerings and creating new insurance products, we find ourselves having to re-evaluate insured assets to match the currency fluctuations, negotiating with reinsurers to provide capacity, and explaining to customers the importance of settling their premium in “fresh USD”
BL: Is the required capital to open new insurance companies sufficient?
Roger Zaccar: I believe the ICC will take the necessary precautions for any new company that may be interested in getting an insurance company license in the current economic environment.
BL: What is your criticism on the current competition among the various insurance companies in Lebanon? What is the solution?
Roger Zaccar: Competition is healthy in any industry, even more with insurance as it allows us to always find ways to better serve our customers. I however do believe we have too many insurance companies currently serving the Lebanese market and expect to see several mergers and acquisitions in the coming years.
BL: How the electricity blackout is impacting your business?
Roger Zaccar: Like everyone else in Lebanon, we had to upgrade our infrastructure to become more power-sufficient by increasing our UPS’s capacities. We are also evaluating the viability of powering our offices using solar panels to reduce our dependence on the power grid and our carbon footprint.
Commercial Insurance recently signed the Lebanon Environmental, Social and Governance Stewardship Program to reinvent ourselves and become more green, by adopting environmental, social, and governance (ESG) standards.
BL: What are your expectations on the topics and results of RVS, Monte Carlo?
Roger Zaccar: The global trend of topics discussed has been related to the changing climate risks, cyber-attacks, customer behavior and the impact of IFRS17 on the insurance industry.
BL: What are your comments on the market condition regarding the upcoming renewals?
Roger Zaccar: The market is slowly restabilizing for the insurance industry in terms of sums insured and premium payment. Renewals remain complicated given the local challenges we are facing, but I hope, and believe, we should be back to “normal” within the next couple of years.
