Bringing transformation to Group Life Insurance Frank Crapis

For Frank Crapis, MLC Life Insurance Head of Retail Products, the most inspiring aspect of the life insurance industry is that it’s a rapidly evolving sector within financial services.

In addition, he’s highly motivated by the challenges of understanding and managing long-term risks. 

‘If you think about the Australian market for example, you can see there’s continual flux from all points of view,’ he says. ‘That includes regulation, consumer sentiment and risk management.

‘The change in processes required to manage insurance risk and the challenges of growth have been tested further by recent economic and health events like the pandemic and recent bushfires.

This has led to new ways of using technology across occupations and demographics as well as changing attitudes to medical developments.  

Crapis adds that the way the community interacts today will have an impact on future insurance risks that we need to manage.

For example, think about the main duties of a current typical working day versus two years ago.’

STRENGTHS AND WEAKNESSES

Born and raised in regional NSW, Crapis says his parents, like many others, migrated from Italy in the 1960s. After finishing a Commerce graduate degree in economics, he took the opportunity to travel.

He got his start in insurance through a graduate program with Mercantile Mutual (now ING), after returning to Australia from Europe, where he had been working as a trainee market analyst at the International Energy Agency.

As part of the graduate program, Crapis says he was lucky enough to experience both general and life insurance.

‘With the help of my designated career mentor, I made the decision to pursue life insurance based on what would suit me best given my strengths and weaknesses at the time,’ he recalls.

At Mercantile Mutual, Crapis furthered his insurance education with a post-graduate Diploma of Insurance and was made an ANZIIF Fellow, the organisation’s highest level of membership.

Crapis has retained his active role with ANZIIF’s Life Insurance Faculty Advisory Board throughout his distinguished 25-year career across insurance and superannuation initiatives as well as leading business management and product and pricing teams at the likes of Munich Re, CommInsure and now MLC Life.

LOVING THE CHALLENGE

Of his more than 10 years of voluntary contribution to ANZIIF, Crapis says it’s important that he’s able to give something back to the industry.

‘I want to be available for those insurance professionals that are coming through, either as a mentor or a guide, for example.

‘I also like the fact that ANZIIF, offers a variety of ways to learn more about managing insurance risk. CPA is for the accountants. ANZIIF is our industry body,’ he says.

Finding the balance between insurance payouts and great customer outcomes in long-term life insurance contracts is one of the challenges Crapis particularly loves about his role.

He says it’s about engaging with the key stakeholders whether that’s customers and advisors in the retail space or trustees and members in group.

BACK TESTING PRODUCTS

He also says it’s critical to engage with reinsurers to understand how similar overseas markets  manage insurance risks while operating in a dynamic industry.

‘And where possible, we need to undertake product development for sustainable reasons.

‘By that I mean, we need to think about how we can back-test our product designs against previous claim cases to ensure member/consumer experiences are what we intended to be the outcome in the short term and over time.

‘Those are only a few elements of what’s required to improve life insurance products,’ he adds.

‘We also need to better understand and predict how consumer and regulator sentiment will change over the next while so that our products remain relevant and valuable to members/consumers into the future. That's the hard bit.’

TRANSFORMATION EXPERT

With an expertise in leading teams of professionals towards business transformations in both Australia and Asia, Crapis is well-placed to help bringing positive change to the life insurance industry.

He says there are two key aspects to manage a successful transformation.

‘The first is detailed planning up front, including having a clear perception of what the end outcome will be, and the second is believing in your team and understanding their strengths, so as to motivate them to deliver.

‘Whether the team is made up of direct reports or key stakeholders, positive guidance enables everyone to be agile and to think about the change required in the event of unforeseen circumstances,’ he explains.  

‘Transformation is not linear, so being positive and agile enough to adapt is critical, including understanding, measuring and mitigating any new risks so the end outcome can still be achieved.’

GETTING INSIDE RESISTANCE

Crapis also maintains that change requires the patience to understand what’s behind any resistance along the way.

‘Resistance is usually related to particular risks that people are not comfortable with,’ he asserts.

‘And if the team isn’t invested in the actual outcome, the planning and process, then we’re likely to get push back.

‘Genuinely connecting with the people has been the key in a lot of the transformations I’ve managed.

‘Understanding the real issues and being agile enough to come up with different solutions brought them back on the journey.’

PREPARING FOR APRA

In his retail role at MLC Life Insurance, Crapis and his team are developing a sustainable new APRA-compliant income protection offering in time for the Australian prudential regulator’s deadline later in 2021.

He says this initiative is particularly timely with new stapling laws expected in November, which will tie workers to one super fund and its associated life insurance products for life, unless they actively choose otherwise.

‘Given stapling, insurers will need to be mindful of the longer-term impacts of managing and distributing sustainable products through super funds,’ he says.

‘For example, as super fund members start opting out of cover, I think Group Salary continuance and commencement terms will need to be updated from a product sustainability perspective.’

LEARNING FROM RETAIL

As moderator for the Regulator update, 2021 Group Life Seminar, Crapis plans to point out the opportunity he sees for the Group Life sector to leverage off the learnings in the Retail sector regarding the best approach to sustainable income protection through superannuation.

He’ll also explore how the definition of TPD needs to evolve to ensure it suits the changing way society engages the workplace.

‘The TPD definition has had a few tweaks and changes, but if we look at workplaces today compared to a decade ago, especially now post-pandemic, a lot has changed.

‘There’s a requirement and an opportunity for more engagement with industry and the regulators to work on that.’