Over the past week, I attended the first in-person Insuretech Connect Asia (ITC Asia) in Singapore since the pandemic, and it was also the first time the Celent team gathered in Singapore. We hosted a preconference session on the topic of “Designing a robust business and digital strategy” on June 7 and invited Tomoo Yano, General Manager, Global Planning Department for Nippon Life, and Monami Mukherjee, Head P&C Analytics APAC for Swiss Re, as guests for the panel discussion.
In the panel discussion, we explored how technology is being used to improve customer experience and relevance globally, through data, analytics, AI, and the creation of service democratization within a broader insurance ecosystem while meeting regulatory needs. This is alongside considerations for cybersecurity, sustainable practices, and the application of cutting-edge technology.
From the great reception of the preconference to the main conference, we attended various interesting sessions, met with dynamic insurtechs and people, which provided a comprehensive view of where the insurance and insurtech industry is heading towards in Asia. We will share some of our takeaways in this blog.
On Distribution Emphasis
APAC insurance trends today are largely a continuance of what we have observed in previous years, such as the discussion on embedded insurance and bancassurance for insurance distribution. The distribution channel is being enabled by digital tools. Insurers and technology vendors such as Chubb, Direct Asia, QBE Asia, AWS, and eBaoTech mentioned examples and perspective for developing digital tools for customer experience or CX. For DirectAsia, motor insurance affinity and workshops have front-end portal which let customers have access to digital insurance, with access to CRM, analytics, and usage-based insurance (partner for telematics to try initiatives through API).
Greenfield Separation from Incumbents to Test New Business Models and Technology
We are also seeing incumbents having separate new business entities to develop new business models, and to experiment with modern technologies and products without legacy conflict. For example, Hive by Income is developed to provide a better customer journey through a broader ecosystem play under a modern architecture. Hive showcased microinsurance and subscription-based insurance products such as Snack, Tribe, and Droplet. Hive is a technology entity separate from Income the insurer. The technology spin-off then works with insurers and partners who process the policies. Data from insurers are pass through and earning are not based on volume sales.
On Ecosystems and Partnerships
The emphasis on the development of the integrated insurance ecosystem is going strong. Ecosystems and Partnerships together with data initiatives are still important. Products developed in partnerships or internally are advised to be tested on a smaller subset for viability before going to scale. Chubb’s B2B2C model organised products around customer API services, with flexibility for partners’ integration. AWS provides a seamless channel to customer, switching from channels, to providing omni channel, and leveraging AI technology to enhance breadth of distribution.
API as the Key Connector
API is still the connecting piece for delivering solutions such as embedded insurance. For example, Swiss Re develops embedded insurance and bespoke products for digital distribution, with focus on product innovation, ecosystem, and global insurance access. Data analytics is also a focus with Swiss Re’s Impact+ solution and the platform provide plug and play APIs and data solutions with visualisation for insights understanding. The ecosystem integrated with various APIs helps insurers’ infrastructure scale in a secure and comprehensive manner.
Insurance Value Chain with Fraud Use Cases
Data analytics use case such as fraud are still relevant, but we must develop appropriate language model such as Vietnamese and Thai language to accommodate the diverse Asia landscape. Vendor such as Shift Technology are developing analytics models with network diagram to identify patterns for fraudulent activities and waste and abuse scenarios, which are commonly found in healthcare benefits claims, whereby an employee may claim for their family members and for unlisted treatments. However, these insights still require humans to judge on the appropriate action to take.
Hybrid Agents and Enablement with Data
Due to the Asia region large dependence on agents, technology enabled agents is a prominent discussion point during ITC Asia. Agents needs to be enabled by technology and to help them communicate with customers better, with use case for process and lead management, powered by data initiatives. Data literacy will enable agents to understand their customers better, with use case such as data analytics for lead generation and identification of customers for retention. Agents are to follow up by stepping in for complex product discussion.
Life and Health with Data
Life, health, and wellness are being enhanced with diverse data and data analytics to improve customer experience. For example, CXA Group’s Employee Benefits Worksite and Wealth Platform with initiative such as e-wallet actualise value-based care through data-drive approach to improve health outcomes. Multiple data sources are used for risk stratification and predictive analytics, which results in personal health profile and targeted care plan. Risk drivers can now be proactively managed. Life and health agents can also be assisted with data-enabled health profile of customers.
Property and Casualty with Data
It was also shared during the conference that most P&C insurers expect data initiatives to help the industry in the next 2 years, but many insurers also do not yet see returns. This highlights the disjoint between data strategy and organisational behaviour, and the need to have better synergy and education.
And for sustainable initiatives, there is a sentiment that leadership may lack understanding to move to sustainable business and insurer customers need to be engage better in this space. Some examples are to have portfolio insights for NatCat accumulation, with data from remote sensing devices and KPI pane to contextualise hazard.
Generally, insurtechs and insurers partnerships are important, and the focus on data is still strong, with potential for investment in countries such as Singapore, India, and Australia. The type of modern technology infrastructure to adopt is dependent on the insurer’s objective and strength, with considerations for domain knowledge expertise versus the need to go “full-stack” and be a fully digital insurance provider with strong technology capabilities.
As insurers, we also need to look at the human aspect, both for customers and employees. Change needs to happen at the leadership level and we need to foster have a culture for learning and failing for innovation and disruptive change to happen in the industry. We must move from aspirations to realizing change.
To learn more, Celent tracks this market and has research addressing it (list of recent reports here).If you would like to find out more, please feel free to get in touch with me.
Below are related reports/blogs contributed by my colleagues and I:
Life and Health Insurance Innovation in Asia Webinar
Digital Insurance for the Future of General Insurance Webinar
Innovation Ecosystem and Data Management – Perspective from Celent’s Asia Webinar Series and TMLS for Finance/Insurance