INSURTECH – It's a MINDSET NOT A TREND

So yes, when “40% OF INSURERS’ PROTECTION REVENUES ARE AT RISK” – that is definitely not a trend.

The past 6 months have been quite interesting for Insurtech and many companies and professionals have held raised the insurtech flag advocating innovation and technology. But with my engagements on a granular level there is a lot more talking about insurtech and less ‘walking the talk’ in forums and conferences, which really kills the true essence of the Insurtech. Insurers are still very conservative and seek proof before hopes.  

So yes, when “40% OF INSURERS’ PROTECTION REVENUES ARE AT RISK” – that is definitely not a trend. Which brings me to the next questions, is building an application to buy insurance and claim enough? In a world of liquid expectations? Absolutely not. Would you use Facebook just for communicating with your friends, or does it offer you more value? Thank you, for answering that.

Impact of GAFA + NATU’s+ BATX:

Google, Apple, Facebook and Amazon + Netflix, AirBnB, Telsa and UBER and BATX (Baidu, Alibaba, Tencent, Xiaomi): As highlighted in my earlier articles, customers are subconsciously comparing our services to that of GAFA and NATU’s of the world which are setting new standards and experiences as we speak. Customers have digital expectations for every product that they use; this breaks down barriers between industries significantly.  

One of the core trend by these big tech companies is leveraging technology and analytics blended with AI and data science to create meaningful and actionable insights to create even more actionable insights and future steps for execution.

Let’s be honest, collectively they would have more precise data of the customers demographics, behavior, lifestyle and sentiment which would enable HYPER PERSONALIZATION and more precise underwriting than what an insurer could with its traditional data now.

So if you do not take the required leaps now then the gap is increasing and bars are rising. Whether you like or you don’t the CX of these customer centric organizations are your minimum benchmark. Anything above is what we create for the users.

The pressure is set to grow as the GAFA, NATU and BATX companies begin to more effectively leverage the Internet of Things (IoT), real-time analytics, artificial intelligence (AI) and other maturing technologies to build even more delightful customer experiences on their platforms.

Let’s cut to the chase and discuss what the core steps are as an insurer that you need to make or change:

1-     Shift Gears Mentally (Major Focus):

Not long ago there were many who did not believe in the scale of insurtech and are now the strongest advocates or talking about technology. BUT, being an advocate and talking about it is not the only solution. Really understanding the solutions from the overall value chain makes the impact.

• Tweaking your underwriting manuals with the current trends?
• Pricing as per the audience today or the same 24 months back?
• Increase your touch points, for access to more data
• Sharing limited data for enhanced user value

Thought: How often do you see Facebook, Google or any platform you use with a frequent notification of an update? Daily, Weekly, Monthly? Any of these is faster than what the industry has been traditionally doing. But why are they making such frequent updates? To stay relevant to today’s user and increasing demands.

We all use these platforms, but when it comes to insurance we still don’t seem to get it (face palm)

2-     Talent:

Be open to on board talent from outside the industry, don’t be afraid to get someone who works for an FMCG even at a senior role. We tend to crib about lack of talent, it is there but lets be more open to talent that is around us and avoid the naysayers who influence not to.

3-     New Revenue Streams:

Creating new revenue streams is a core. But this is not 2016 as a lot has changed till now. Data

that you possess now can be monetized if you see the future and curate the meaningful insights from what you have.

Secondly, give a thought around how you could add more value to the users? (Let me know if that’s of your interest).

4-     Focus on Experience:

Building products one after the other would not make a difference until you create a proposition that is aligned with the existing user experience or creating a new experience that is creating more value. Don’t create to fit, create to expand the user experience.

5-     Dissolve Rigid Tech Structures:

Your core systems are you biggest impediment. Having an agile and a highly adaptive core system is essential. There are insurers (with no offence) that are claiming to be digital but their core is as weak a house of cards.

If you core is weak, then start building an alternate with frequent pilot, tests and pivots.

6-     Let’s Admit It, We Cannot Be Master of All:

Collaboration is key. Major startups have been raising the voice of idea or project hacking. They pitch and the idea/project is hacked. Some end up executing them but as they have not mastered the concept, probability of success really diminishes multi-fold. Resulting in a damaged validation for idea/project or model.

Hear them out, if there is a potential of collaboration then partner. If it does not then let go, there are plethora of opportunities out there.

7-     Test, Fail and Learn Fast:

Contemplating whether a new model will work or not can only be proven after execution. There critics for every model, app and platform that we all have in our smartphones. I met an executive who was a strong advocate of branch banking but now a very strong believer of branchless banking.

Launch products developed internally or in collaboration with startups, but under a controlled environment. I have seen companies claiming to be digital and making announcements but post launch the realize, “ Oh our API’s wont connect” a clear project management flaw and a case of weak tech systems.

Therefore, TEST under a controlled environments but give it a DEADLINE. They cannot run forever and hammer your cash flows

8-     Smart Partnerships:

For those who have seen the future of insurance, they need to focus on smarter partnerships with:

1- Top Accelerators and Incubation Hubs in MENA:

• FinTech Hive
• SHERAA
• Dubai Future Accelerator
• 1776
• Astro Labs
• DTEC
• Turn8
• Dubai SME
• Flat 6
• In5

2- Big 4

3- KPMG Digital Village

4- Accenture FinTech Innovation Lab

5- Universities

OR

These partnerships maybe exactly what you may be thinking in your head or what’s in my head. Which means it could go in any direction as long as it is making business sense.

9-     Execution Matrix

What is essential is keeping track of what you start and what you execute. Most of the projects start but end up going into an unknown territory and ends up being side line or in the back burner.

E.g. I met a CEO of a TPA lately, who mentioned they had built a product 2 years back but it’s being kept in the backburner. The reason for which was “internal reasons” but nothing more.

My next piece would be on smarter underwriting and GDPR. I am not actuary but yes I have learnt the art from some of the best to whom I would give credit to.

Lastly, we all love innovation we all love tech and we would want to cash onto the 4th Industrial revolution which is preparing you for the fast approaching 5th revolution. Don’t just join the bandwagon, what may work for 1 market may not for the other. If you do not have strong dynamic + dedicated tech support then you are headed towards a massive iceberg.