1. Hugh
Terry,
The
Digital
Insurer
Fintelekt
7th
Annual
Insurance
Technology
Summit,
Mumbai
20th
January
2016
DIGITAL
INSURANCE
–
OPPORTUNITIES
IN
INDIA?
2. Discussion
agenda
1
Why
is
digital
so
transformaEve?
2
TransformaEon
of
face-‐to-‐face
insurance
2
Digital
OpportuniEes
for
India?
3
4. The
Digital
RevoluGon:
“It
will
not
be
televised”
DIGITAL
CONVENIENCE
DIGITAL
CONNECTIVITY
DIGITAL
EXPECTATIONS
Always
on
Always
there
Universal
Almost
free
Access
to
informaEon
(Google)
Access
to
each
other
(Facebook)
Access
through
devices
(Apple)
LocaEon-‐agnosEc
(cloud
services)
Data
“on
demand”
Desire
for
clarity
&
simplicity
Dialogue
not
monologue
Easy
to
promote
a
product
..
And
complain
4
Change,
Change,
Change….
5. 55
Our
digital
world:
very
new,
addicGve
and
diverse
Source:
The
Economist,
Qmee.com
New
&
Big
AddicGve
Diverse
6. Three
digital
“Mega”
trends:
forces
beyond
our
control
Changing
consumer
behaviour
–
they
are
more
demanding
and
looking
for
a
different
experience
3
Technology
is
cheaper
and
easier
to
implement
than
ever
–
it
is
the
lever
to
meet
consumer
needs,
reduce
operaEng
costs
and
to
change
your
culture
1
6
Data
maXers–
we
are
collecEng
more
and
more
data
that
can
be
used
to
create
winning
business
models
2
7. 7
Welcome
to
digital
customers:
“they
are
mulG-‐touch”
7
Myth
#1:
Digital
is
a
new
distribuEon
channel
Reality
:
Digital
enables
customer
(&
distributor)
engagement
Online
Face
To
Face
Phone
The
mulG-‐channel
customer
is…
Becer
informed
More
demanding
Uses
mulEple
customer
touch
points
for
both
sales
&
services
Increasingly
starts
on-‐line
Will
jump
channels
at
any
point
–
catch
them
if
you
can!
8. 3
core
strategies
Transform
exisEng
face-‐to-‐
face
models
2
Create
or
parEcipate
in
new
models
3
Manage
exisEng
models
for
profit
1
8
10. AGENCY
MODEL
HAS
WEAKNESSES
Life
Insurance
in
India
§ New
Business
for
industry
falls
25%
in
5
years
to
2015
§ Agency
accounts
for
78%
of
total
sales
(2013-‐4)
v
90%
(2006-‐7)
§ LapsaEon
rates
remain
high
>
40%
@13months
§ Agency
salesforce
falls
30%
in
5
years
to
2015
10
2.
REGULATIONS
TIGHTEN
§ Inefficient
–
for
many
reasons
§ Difficult
to
control
–
mis-‐selling
too
common
§ Historically
biased
towards
investment
component
RECENT
PERFORMANCE
POOR
…
BUT
HOW
WILL
DIGITAL
TRENDS
IMPACT
THE
AGENCY
MODEL
GOING
FORWARD?
.
MORE
POSITIVE
OUTLOOK
§ Increased
focus
on
ProtecEon
§ Growth
returns
to
industry
in
2015
§ Foreign
capital
changes
encourage
investment
11. Trust
is
at
the
heart
of
insurance
Rely
on
agent
relaEonships
Insurance
brand
is
a
hygiene
factor
in
the
sales
process
As
customer
research
on-‐line
trust
will
need
to
be
developed
and
leveraged
on-‐line
Trust
must
be
earned
&
reinforced
at
every
interacEon/touch
point
Great
insurance
advisors
-‐
always
in
demand
Lack
of
standardizaEon
in
training,
performance
management
&
coaching
Result
:
variable
quality
of
advice
and
low
producEvity
resulEng
in
high
agent
turnover,
low
policy
persistency
When
customers
research
online
they
will
research
their
advisors
as
well….
Less
Eme
face-‐to-‐face
–
but
no
less
important
(probably
more
so)
Insurance
advisors
need
to
be
more
mobile
(digitally
&
physically)
Digital
will
transform
&
standardize
key
management
processes
Customer
service
maXers
Nearly
100%
reliant
on
the
advisor
Back
office
is
…
back
office
Mobile
technology
provides
opportuniEes
for
cost
effecEve
customer
service
differenEaEon
Push
based
communicaEons
can
be
used
to
reconnect
with
customers
Myth
#2:
Digital
changes
the
way
insurance
is
sold
Reality:
Digital
strategies
must
incorporate
the
fundamentals
Current
Agency
Paradigm
Digital
impacts
Back
to
basics:
Digital
Advisor
strategies
need
to
leverage
insurance
fundamentals
11
12. Customer
Portal
/
App
Policy
Systems
Advisor
Portal
Lead/Prospect
Management
Sales
OpportuniGes
Tablet
POS
12
Digital
Advisor
business
model
Digital
OpportuniEes
1.
More
Leads
2.
Becer
service
3.
Becer
selling
“connecGng
to
the
digital
eco
system”
13. 1. Enable
lead
management
&
analyEcs
/
PredicEve
analysis
2. Improved
compliance
to
sales
best
pracEce
(&
regulatory
requirements)
3. Back
office
producEvity
from
digital
proposals
7
OTHER
BENEFITS
AFTER
SUCCESS
POS
tablet
sales
toolkit:
easy
business
case
PRIMARY
BENEFIT
Improved
Sales
effecEveness
through
a
becer
customer
experience
MEASURED
BY:
High
tablet
usage
from
Advisors
Increased
sales
producEvity
per
month
• More
efficient
• Faster
&
more
accurate
(clean
policies
in
a
day)
4. Reduced
overheads:
premises
&
technology
costs
5. Business
intelligence
6. Recruitment
training
(and
hiring)
tool
7. Plasorm
for
more
automated
underwriEng
• Benchmarking
data
• Usage
data
• “Bigger”
data
13
14. 1. Full-‐Eme,
salaried
&
No
mulE-‐
level
hierarchy
2. Digitally
enabled
advisors
for
remote
sales
&
servicing
–
a
genuine
mobile
office
3. On-‐line
lead
generaEon
driven
by
the
insurer
using
corporate
&
sales
person
digital
connecEvity
4. Digitally
assisted
recruitment,
training
and
coaching
HOW
COULD
YOU
RADICALLY
REDEFINE
FACE
TO
FACE
SALES?
Agency
of
the
future:
Who
will
move
first?
14
<
200,000
Full-‐Eme
advisor
>
15
policies
per
month
per
advisor
>50%
of
lead
generated
on-‐line
>50%
of
sales
executed
virtually
WHAT
WOULD
A
DESIRABLE
END
STATE
BE
FOR
AGENCY…?
How
can
we
radically
transform
face-‐to-‐
face
models?
Q.
Will
an
exisEng
insurer
adopt
radical
transformaEon
–
or
new
entrants?
16. There
are
untapped
opportuniGes
around
the
world
Seriously
shopped
but
didn’t
buy
life
insurance
(10%)
Didn't
shop
for
life
insurance
(78%)
Seriously
shopped
and
bought
life
insurance
(12%)
Buyers
and
non-‐buyers
of
life
insurance,
US
households(%),
2011
Can
digital
strategies
change
the
paradigm
that
“life
insurance
is
sold
not
bought”?
Chart
Source
:
To
Buy
not
to
buy
life
insurance,
LIMRA
2011.
Extracted
from
Swiss
Re
Sigma
06/13
.
*Swiss
Re
Asia
Pacific
Mortality
ProtecEon
gap
2015
16
78%
12%
10%
US$55
trillion
ProtecEon
gap
in
Asia.
India
:
US$8.5
trillion*
17. Digital
OpportuniGes
for
India
CreaEng
a
profitable
motor
porsolio
2
Digital
life
“ecosystem”
proposiEon
3
Redefining
Employee
Benefits
1
17
18. Employee
Benefits
18
OPPPORTUNITIES?
1. Affinity
–
the
employee
2. Group
like
pricing
for
the
individual
3. SME’s
not
well
served
4. Employee
benefits
is
archaic
–
easy
to
improve
19. Commentary
&
insights
Excellent
example
of
“service
for
Free”
model
disrupEng
two
industries
(HR
soyware
and
employee
benefits)
Window
of
opportunity
was
Affordable
Care
Act
that
simplified
raEng
for
health
insurance
for
small
companies
Not
so
“Zen”
–
very
public
argument
regarding
use
of
ADP
payroll
accounts
Suite
of
HR
services
Background
Fastest
growing
SaaS
business
ever
Offering
free
HR
soyware
plasorm
and
integraEon
to
third
party
services
in
return
for
insurance
on
employee
benefits
Focused
on
SME’s
Just
raised
US$500
million
on
US$4.5
billion
valuaEon
Revenue
target
of
US$100
million
by
Jan
2016
Region:
North
America
Broker
Model:
Zenefits
1919
20. Crystal
clear
and
compelling
proposiGon
TesGmonials
Online
employee
filing
cabinet
100%
paperless
benefits
enrolment
Automated
onboarding
Zenefits:
customer
focus
reaps
rewards
2020
Q.
Is
there
an
opportunity
for
a
Zenefits
in
India?
21. Motor
Insurance
21
OPPPORTUNITIES?
1. Profitable
niches
using
telemaEcs
2. Rewards
based
structures
to
reduce
pricing
sensiEvity
3. New
customer
acquisiEon
strategies
22. Vitalitydrive
–
holisGc
rewards
programme
Immediate
Fuel
Rewards
&
safety
features
Drive
well
to
earn
points
Maintain
and
improve
Vitalitydrive
status
Enjoy
the
rewards
App
giving
driving
performance
and
reward
profit
Q.
Could
a
motor
rewards
scheme
work
in
India?
23. Vitality
driving
challenge
–
App
only
Discovery
Insure
driving
challenge
app
combines
mobility
and
behavioural
science
to
improve
road
safety
independent
of
the
telemaEcs
device.
Excellent
for
customer
acquisiEon.
24. Digital
Life
Insurance
24
OPPPORTUNITIES?
1. Valued
added
term
insurance
2. Lead
generaEon
mechanisms
for
face-‐to-‐face?
25. Region:
United
Kingdom
Managing
Agent
Model:
Beagle
Street
2525
Background
8%
of
new
business
in
UK
from
this
company
Online
recommendaEons
for
customers
Relevant
value
added
services
Term
Life
with
great
experience
Q.
Do
we
have
enough
focus
in
India
on
customer
experience?
“The
larger
part
of
our
success,
however,
comes
down
to
our
single-‐
minded
focus
on
innovaEon.
We
recognized
early
on
that
major
change
was
coming
in
the
way
life
insurance
was
being
distributed
and
so
we
focused
our
acenEon
onto
innovaEng
at
the
distribuEon
level
and
invesEng
heavily
into
improving
the
way
that
life
insurance
is
sold.”
-‐
MaXhew
Gledhill,
CEO
of
Beagle
Street
26. Region:
Asia
(Singapore)
Agent
Model:
AIA
Vitality
2626
Background
Points
for
Wellness
acEviEes
including
tracking
Comprehensive
rewards
Science
based
programme
5
million
members
around
the
world
Wellness
Rewards
Q.
How
quickly
will
this
programme
expand
to
other
countries?
27. Region:
Asia
(Hong
Kong)
Agency
Model
:
Move
(from
Manulife)
2727
Background
Free
tracker
for
qualifying
products
Up
to
10%
discount
on
premiums
TelemaEcs
for
agency
sales
Q.
Will
this
become
mainstream?
28. Region:
North
America
(US)
Managing
Agent
Model:
Sureify
2828
Background
Lifestyle
opEon
Discounts
for
healthy
lifestyle
Term
Life
+
telemaEcs
Q.
How
long
before
we
use
telemaEcs
with
term
life
insurance
in
Asia?
29. Digital
innovaGon
in
insurance:
what
ingredients
are
needed?
29
• Customer
at
the
heart
of
the
process
• “Outside-‐in”
approach
to
iniEaEves
• Respect
customer
choice
• DistribuEon
partners
• Tech
partners
• MarkeEng
partners
• Eco-‐system
models
1.
Customer
Centric
2.
CollaboraGve
ü
ü
5.
Data
centric
&
scalable
operaEng
models
leveraging
technology
plasorms
4.
New
challenger
brands
–
disrupt
own
business
if
necessary
3.
Agile
frameworks
and
mindsets
6.
Strong
internal
support
for
a
clear
plan
with
risk
miEgaEon
via
piloEng
Enablers
30. 30
30
Transforming
insurance:
Acknowledging
innovaGon
Source:
Transforming
Insurance,
KPMG
InternaEonal,
2014
&
The
Insurance
InnovaEon
ImperaEve,
KPMG
InternaEonal
2015
30
Acknowledge
the
challenges
Seize
the
opportunity
65%
Regulations high costs &
margin erosion
45%
48%
83%
future success =
ability to
innovate
business models
disrupted
31. 31
31
Our
industry
is
on
the
move
Source:
Survey
of
280
global
C
Suite
execuEves
for
«
A
New
World
of
Opportunity:
The
Insurance
InnovaEon
ImperaEve,
KPMG
2015
31
How
fast
can
we
innovate?
At
our
fastest
is
it
sEll
too
slow?
GOOD
LUCK
WITH
YOUR
OWN
DIGITAL
ADVENTURES
!
32. 32
About
The
Digital
Insurer
Contact
The
Digital
Insurer:
hugh.terry@the-‐digital-‐insurer.com
32
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