Gideon Galloway: Doing Insurance Differently — InsightsSuccess
For businesses across the globe, 2020 demanded new ways of thinking about, and doing, many things. In this difficult year, Gideon Galloway — CEO at King Price Insurance — stayed committed to finding sustainable solutions for their clients, partners and investors. So, not much different to previous years, really.
Gideon launched King Price nine years ago with a strong team that’s grown as the business has grown. In 2012, they were a ZAR100 million start-up; by the end of their eighth financial year, they were worth ZAR5.3 billion. Similarly, the tiny original start-up team now has more than 1,100 engaged, purpose-driven employees — all of whom pull together to make their insurance products easier to understand, manage, engage with, and claim for.
Although they’re known as the ‘maverick’ of the South African insurance market, King Price’s valuation approach and methodology are actually very conservative when compared to other South African insurers and listed financial services companies, as well as when compared with international markets. Even so, their last financial year added another 28% to their value.
Gideon says that, while that’s beyond big, they’re by no means close to being done. The secret to this success is something he shares freely: “Follow your dreams. Push through. Don’t let capital be a hurdle.”
We spoke to Gideon about how he plans to grow King Price even more. Here are some highlights:
Take our readers through your role at King Price and your journey so far with the company?
It’s been almost a decade since we launched. We’ve moved past our start-up years but our vision is still the same: Lower premiums: Higher purpose. We want to change the insurance landscape in SA and make an impact all over the world.
Two years ago, we took our first leap towards substantial expansion by buying a South African life business and acquiring a stake in a holding company with insurance interests in Europe, which will run on our business model. We’re super excited about the future and look forward to continuing to grow at 30+% annually — in a sector and economy that are barely growing at all.
What roadblocks or challenges did you face as a corporate business? And how did you overcome them?
It’s never NOT been a challenge! Working in the heavily regulated FS landscape; governance; solvency requirements; rating models; capital and the deployment thereof: gaining ground in a fiercely competitive market; scaling: all challenges.
We overcame these — and other — challenges through passion and vision, and by getting the right crew on board as we built our business. You could say that we built the ship while we were already sailing, and we’ve weathered storms as well as calm seas.
Three things in particular have contributed to our success:
- Marketing: Industry figures show that we spend around 2% of what the bigger local insurers spend on marketing. Everything we do aims to break through the clutter and position our company as a customer-centric, forward-thinking innovator. If we can’t do it differently, we don’t do it!
- IT: We don’t run off legacy systems. Instead, we built world-class systems in-house that enable us to be agile, fast and innovative. Like everything we do, our IT systems put our clients at the heart of all transactions and interactions.
- Our unique culture: We make sure that we bring the right people on board and retain them. When people are happy at work, they’re more invested in the company’s goals and aspirations, get things done faster, and take ownership of their decisions. We encourage our employees to come up with new ways of doing things and to have fun while they’re doing it.
How do you make sure that your team works towards offering easier, faster, and more cost-effective insurance?
It’s in our name: King Price. We continuously innovate so as to be more cost-effective than the competition. As an example, we’re the first insurer in the world to offer comprehensive car premiums that decrease monthly as the cars depreciate in value. We just don’t think it makes sense to only ever pay more to insure something that’s only ever worth less!
We also listened to our clients when lockdown hit South Africa in March 2020. They were driving less and so
wanted to pay less for their insurance. Rightly so. But the ‘discounts’ being offered by other insurers weren’t sustainable. So, we designed, built and brought to market a new product called chilli, which can save clients up to 70% on their car insurance every month.
Tell us about the culture at King Price?
‘Culture’ is a broad term. For us it means that, as a collective group, if we enjoy what we do, we’ll excel and be more productive. So, we try to align all our business principles to benefit our employees, clients, suppliers, business partners, shareholders and communities.
We attract the best people to give us the edge and then we make sure they’re fulfilled, challenged, appreciated and rewarded. Nine years down the line, most of the core group that we launched with are still with us, and I think that says a lot. Basically, we’re a team that has a purpose, works fast, and has fun.
We launched with 7 ‘family values’ that have guided us well, but we’ve just re-looked them and distilled them down to 4 core sentiments that guide everything we do. I’m so proud that our values aren’t just posters on the wall. We live them every day, and we make values-based decisions. Everyone benefits.
Probably everyone’s favourite value is ‘fun with a little madness’. Our office may look like a circus, but everything is measured. We take what we do very seriously… But ourselves, not so much!
Why do your clients take out policies with King Price?
Look, insurance is a grudge purchase and pretty much a commodity. No one wakes up in the morning all excited about buying insurance. But we do everything we can to inject some humour and humanity into the process — starting with our brand tonality, which is approachable and casual throughout the client journey.
We have many unique client-centric products, including our decreasing premium model, our new ‘pay per k’ chilli cover, and charging our comprehensive car clients just ZAR1 per month to insure their golf clubs and bicycles. We make it easy for our clients to understand what they’re buying and to engage with us on the platform of their choice. We always view our business from our clients’ point of view and are constantly refining our processes to make every touch-point smoother, simpler and more convenient. Another of our values is ‘customer is king’. This underlines everything we do.
How has King Price contributed to the community?
King Price was founded on the principle that we want to make a difference, in South Africa and across the world. 35% of our profit goes into foundations that support grassroots organisations and enable charities in southern Africa. It’s core to what we do.
In addition, our decreasing premium model has saved our clients over ZAR200 million and counting. We also make a difference in our clients’ lives by offering them products they need and giving them sound financial advice.
What’s your vision for sustaining King Price’s competency in the cut-throat and volatile world of business? Where do you see yourselves in the next five years?
It’s been cut-throat since we launched, so we’ll keep on keeping on. We aim to continue to grow at the same pace. In five to 10 years, we’ll be in 20+ countries but still maintaining our lean, fast-moving business ethos.
The world is changing and insurance needs are changing with it, which means business models have to change. My children probably won’t even own cars. And if they do, they’ll be self-driving. Just these two future realities mean that insurance companies will have to change fundamentally in order to remain relevant and solvent. We’re already planning different products for different needs.
Mostly, though, it boils down to staying humble and never taking anything for granted.