Technology Trends Shaping Insurance

By Balkrishna Singhania, EVP & Head Digital, HDFC Life | Wednesday, 31 March 2021, 07:32 IST

Balkrishna Singhania has 17 years of experience as an Analytics and Consulting Leader. Before joining HDFC Life, he was associated with PwC Advisory as Managing Director & Head of Analytics Innovation. Prior to that, he has worked with Citigroup, Fractal Analytics, Capital One Bank and GE India Technology Centre.

Our mindset has always been to move closer to consumer wants and needs. Insurers that make their customer journey and engagement models responsive; build bionic distribution; leverage digital and data as a ‘force multiplier’; rewire business using analytics at scale and adopt a ‘truly agile’ way of working for rapid roll-out of digital transformation initiatives will have the advantage.

Humans are getting accustomed to a highly personalized and seamless experience. Insurance companies are expected to provide similar personalized experience across products, pricing, servicing and claims. Omni-channel experience is an important factor to attract and retain customers.

Technological advances in IoT, Big Data Analytics, Artificial Intelligence, Blockchain and Machine Learning are enabling innovations across the insurance value chain.

We have believed in investing in digital early thereby making it a part of our customer focussed journey. Multiple technology teams work cohesively focussed on a seamless customer experience through innovations, data optimisation, platforms and core-tech. For example, today, nearly 99 percent of our customers use digital channels for completing their life insurance journey and needs from frictionless on-boarding and faster issuance to 99% of claim settlement in a single day. Customer-facing processes are enhanced through 250+ bots, 24/7 service toolsusing vision, voice and text. Digital Life certificate is another helpful service especially for senior citizen which allows them to do a liveliness check from the comfort of their homes. Our agents and frontline sales teams are empowered to make sales pitch via an industry first video-based sales enablement tool with screen share and tri-party connect, thereby ensuring that everyone has access to life insurance.

Drivers of digital transformation in Insurance

Big Data to create competitive advantage

Insurance is a highly data intensive industry. Big Data will enable customisation of insurance policies to individuals, minimise risk, improve underwriting accuracy. Data will be leveraged to support risk assessment and premium calculations. Information fetched from wearable devices, credit bureaus and social media could be used to customize and price policies more accurately.  This should benefit customers through customized and pre-approved offers.

Cloud computing to spur scale

Cloud computing is becoming a critical component of growth and playing a pivotal role in scaling new innovations. Speed of application development leveraging native cloud capabilities, deployment on cloud and cost-effective demand-based rapid scale-up will ensure reduced downtime at peak traffic times such as month-end/tax-filing deadlines. It will also free crucial IT resources to focus on functional requirements.

AI and ML to improve accuracy and efficiency

AI and ML technologies free-up insurers and underwriters for more important tasks. AI helps in automating various parts of underwriting, risk assessment, and fraud identification processes,whileMLallowsmodels and solutions to continuously learn from new data and get savvier with each year that passes.Hyper personalization of incentives to salesforce and curated nudges to consumers are implemented today to improve cross-sell, renewal collection and turnaround times thereby improving customer experience.

Low-code/No-code and rapid application development to aid customer centricity solutions

Customers today expect BFSI companies to have technologies and processes at par with the latest e-commerce apps, fintech and insurtech start-ups. This requires companies to continuously re-invent customer journeys and make them smoother and hassle-free. This is enabled through a two-speed IT team – one that manages the core-tech and one which rapidly experiments on new customer journeys. New technologies such as low-code/no-code platforms helps consumer champions and process owners rapidly prototype and manifest their vision for customers into reality.

Shift towards Micro-services based architecture

Rather than a single monolith application which integrates all functionality into a single codebase, insurers will move towards micro-services based architecture that will allow them to distribute functionality across “independent services”- leading to better management, resilience and rapid localized changes without impacting the entire “monolith”.

API gateways will help expose these micro-services and their customized variants to partners and distributors ensuring a partner driven customer experience –a “hyper-local experience” if one may say.

Voice and v-commerce, the next big wave?

Increasingly insurers are working on building voice based customer journeys. For example, in HDFC Life, Elsa and Ezra answer customer queries and servicing requests on Alexa and Google Home respectively. Our interactive avatar Zoey helps customers through policy servicing transactions. Voice based form-filling and customer on-boarding will reduce customer effort of manually filling several fields and ensure lower drop-off rates.

Blockchain holds promise

Although Blockchain implementations have currently not taken off in insurance, smart contracts show significant promise. As customers increasingly split term insurance purchase across multiple companies, they may not need to repeat medical tests again. By placing their medical data on a Blockchain and sharing the key with the insurer they wish to transact with, the same medicals can be used for different policies thereby significantly increasing customer convenience.

Extended Reality (XR) may be game changer

These are still early days for Extended Reality (XR) technology in Insurance. XR would make data-gathering much simpler, safer, and faster by allowing investigators to assess risk and damage using a 3D image without having to visit the site themselves, drastically reducing TAT’s for customer facing processes

In Conclusion

HDFC Life believes that technology is an enabler and not an end in itself. Simplifying the experience for customers should be the key focus, if you want to create a ’pull’ for one of the most important financial decisionsan individualcan take to bounce back.