Products, Distribution and Technology

Vineet Patni, Chief Institutional Business Officer, Bajaj Allianz Life Insurance Company
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Our basket of products coupled with technology will be a big boost to the business. A customer will have more choices, competitive products with better pricing, while we continue to improve our services, says Vineet Patni

Two decades ago, it was product touted as the king. A decade later, customer became the king asking for a choice of customised products that was available to him. Today, technology is the king. All three have merged to serve the customer better and make the industry grow. Today, the focus is on simplification of processes, which are seamless. A customer is always counting on his clicks.

The attention span of an average customer has reduced to below 5-6 seconds and if within this time frame, he is not hooked on to the proposition, you lost him. It is absolute no, no, to expect a customer to go through long process.

The same change is starting to happen even in the insurance space. Earlier application forms were long, may be 70-80 questions. Now everyone is talking about no more than ten questions and we have seen in lot of forms where we could make process extremely simple. Simplification is key!

The demand for insurance products is likely to increase due to growth in household savings and purchasing power with middle class and working population.

Growth drivers for insurance will be innovation and removal of inefficiencies and growing competition. Multiple distribution channels for increasing penetration, efficient claims management and settlement, expanding products range and regulatory support are but few factors that are contributing to growth of the sector.

Technology, big data, analytics and various other tools allow us to know our customer better—his preferences, behaviour and needs. Today’s customer is also relatively better informed. A prescriptive analytics will also reduce mis-selling, while it enhances the ability to understand the customer better who is finally made a proposition to fit his needs. Earlier, this was not possible. Products were stereotype and were sold “as is”.

Due to the changing needs of time and customer behaviour, for selling insurance, a strategic approach is required where all activities in the insurance value chain, including interaction with stakeholders, are done in a responsible and forward looking way by identifying, assessing, managing and monitoring risks. Our aim is to reduce risk, develop innovative solutions, improve business performance and contribute to social security. Technology is causing a welcome disruption here and is contributing to making not only the businesses dynamic but also flexible insurance products.

The new trend is research online, buy offline. We are also seeing it happening vice versa. This, as per the regulator guidelines, India does have the price advantage when a customer buys online. This means, by cutting off a certain set of intermediaries in the process, the benefit is passed on to the customer in the form of reduction in online premium. So, it is not just about buying a product, it is also about getting the right value and there is a good amount of competition happening there.

Open architecture has also been made possible due to both regulatory changes as well as technology and has been a big boost to life insurance. By adding corporate agents such as banks that solicit business for insurers, the reach of the channel has hit the grassroots. It is also allowing competition, which is benefiting the consumer. Robotics and machine learning is the new trends to provide insights into a customer’s behaviour over a period of time. This allows a company to know its customer better, even compared to big data analytics.

Another change being brought in by technology is by wearables, that people use to ensure their health remains in good shape. The data that gets collected is fed back to insurance companies on how a consumer behaviour or health indicators are changing or improving; accordingly price advantage is given back to the consumer or new products are created. For example, the moment your grocery bill is paid, the data is collected and the consumer is flooded with ‘live healthy’ offers to catch his attention. So, it is about living long and this is something that has direct impact on life insurance, health insurance and pension products.

(The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of INCLUSION. Comments are welcome at info@skoch.in)

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