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Reinsurance in India in the Tech Era: 

 IRDA has formulated the rules to ensure a level laying platform for foreign and Indian reinsurers. The purpose is to protect the interest of Indian firms, remedial measures and rules are drafted have been formed to streamline reinsurance operations in India. For the new entrants, reinsurance is called as insurance for insurers and basically a practice of protection for their balance sheets against paying hefty sum of claims because of large man made and natural causes. The reinsurance in India is on the brink of the technology oriented shift. The major areas to be focused includes Cloud Computing, Telematics, GPS, IoT, Big data analytics, Information Technology and the role of artificial intelligence. To embrace this rapid change the customers are becoming tech-savvy in this digital world.

According to Global Insurance Digital Survey: This Tech Era of reinsurance has transformed the way that the companies and customers interact with each other with digital revolution. As a result into companies is keeping on adopting digital platform to make their customer satisfying and loyal. The insurance companies are developing innovative products and trail the customer friendly digital experience

The upcoming future will be based upon the technology that promises to transform the insurance industry with better deals and product development to customers. Matt Cullen the American researcher has quoted that “Traditionally insurance termed as a process of financial compensation rewarded to policyholder based on the risk materializes”. But in today’s scenario it acts as a real time consultant and has a massive benefit for the industries by providing their offering to their customers.

The reinsurance industry was facing a situation of excess capacity as supply exceeds the demand for the capital and it is causing pressure on pricing. Cyber security and risk grows with each technical innovation and this affects the data integrity of the firm. This issue gets complicated when companies improve security 20% annually and the hackers improve 300 % each year. Using the block chain technology can show immediate impact on the top line of the combined ratio and open doors to new product development and also for the operational efficiency. While, low insurance penetration is still a major challenge and untapped rural market.

Technology provides the new ways to analyze, control and risk prediction associated with customer that improve efficiency by expanding insurability. According to Christof Mascher, COO Allianz stated “How to increase frequency of customer interaction considered as a big challenge for insurance industry “

Insurance industries in India keeping up with the fast paced digital world with the tech savvy customers meet their expectations and try to improve their services. The different verticals of the insurance industries such as underwriting claim department and other are turn out in the past few years with the emerging technology in their operations. To be more innovative in their product offerings companies are opting latest technology of the market to meet anticipated consumers and also the expectations of the shareholders.

To put the pressure on existing insurance companies present in the market. Companies are collaborating with the market leader to gain competitive advantage and to be more innovative in their product development and service delivery.

Data analysis and big data analytics

Big data analytics exemplify the innovation that helps the insurance companies in taking the appropriate decision by providing the insurers a intuitive insight. Big data contains the abundant information that is collected from different sources such as policy held by the customer. This data also help the companies to store the accurate information and can be obtained when it is required.

This data allows the companies to collect more data about their customers and maintain quantum of imperfect information. With the data companies keep on track the past claims to procure themselves from the fraudulent acts or false claims.

Consolidation, Mergers and Partnership with Tech Companies

The push factor creates a pressure on the companies to adapt technology advancement and changing consumer behavior. For example, to gain profit from underwriting business National insurance, United India and oriental insurance will decide to consolidate their business. Hence In the upcoming two years these public sector general insurance companies are going to merge to become a separate entity, lead to enable these companies to improve their internal system to effectively manage data and workflows.

Market Driven Competitive Industry

Technological shift brought many changes and development in the insurance sector in India for both the public sector and private sector insurance companies. With the large population and untapped market seems to be a great opportunity in India. The insurance business is growing at the faster rate of 32-34% annually.

Emerging Product Development

User interface mobile application to bring the ease in the process of policy issuance and other aspects to operate their business effectively. For example,         Bajaj Allianz has firstly introduced Cyber safe insurance as a new exposure of their portfolio is one of the trendy emerging product. These products are designed based on the needs in the market; subsequently companies are pinching the untapped segment.

Smart Home and Property Insurance

In Los Angeles many insurance companies incorporated HD Video doorbells that helps deter break-ins such as internet connected doorbells allows the house owner to see and speak with the visitors at their door using mobile phones. Insurer offer add on cover to the policy holder to install these devices as a question to their security aspect.

Health and life insurance

Sensor equipped devices based on biometric devices like smart watches to monitor hear rate, blood pressure, glucose level, oxygen etc can easily detect ones health issue. For example Bajaj Allianz has recently introduced “PRO- FIT “the best health tracker and fitness platform to their customer.

The Smartphone world

According to Parul Green, Consumer wants digital interaction and tries to change their experience of insurance. Online forum to discuss various issues and ensures a virtual presence of Insurance Industry. This platform provides new methods for insurance company and customers to interact visually such as companies can send text and reminders for renewals to policy holders. By using various applications available consumer can easily compare prices and buy accordingly.

Drive smart

 A tracking device named “DRIVE SMART “has introduced by Bajaj Allianz to its customers for providing them real time information about their vehicle diagnostics and security alert, use of telematics to monitor individuals driving and offer service like road side assistance if the vehicle detects poor responses.

Gamification applications

Bajaj Allianz was first insurance industry in India that introduced Gamified insurance simulation like Sherlock, wolf of the park street etc learns about their products being an insurance salesperson and how to sell them.

Deployment of product and services

In this modern era , life insurance and general insurance companies need to enable digital integration for introducing new products and services through the social media platform to test the efficacy of the launched product and services.

Insurance industry is witnessing a continuous adoption of technology that is operating with a valuable business models. Considering the value added services to their customer in a competitive market. Disaggregation of the insurance product development and offering services to their customer through the latest technology such as BAJAJ ALLIANZ has introduced “Chatbot-the virtual robot” and other digital tools that are creating competitive transparency in the market.

Virtual initiatives and Recalibrate

A programmed designed by operations team in coordination with HR team to train the branch operations and service Managers (BOSMs) and assigned a new role to handle branch operations along with admin and servicing activities for their new rollers that they are being trained to cater their stakeholders in the best possible way. In accordance with Recalibrate 1.0 and 2.0 was conducted in different month at many locations PAN India with 137 participants wherein Two days programme to stakeholders with the feedback form for the responses and to measure efficiency of the programme.

Drive to Lets’ connect and lets JAM

To activate inactive IRDA agents virtual office team of Bajaj Allianz has launched “Let’s Connect “initiative to focus on meeting with agents, understanding the reason behind their inactiveness. Whereas on the other hand company is launching an exclusive learning series for their BAGIC family with the JAM app, the team will send different articles and courses that are very useful in day to day business interactions.

 We connect and Talport

We connect is an one stop HR solution for their employees to make the things easier and releasing pressure on HR team, faster responses for the queries and instant clarification of doubts whereas Talport is a first virtual employee, Eve that is an automated talent acquisition portal named Tal.port for recruitment and selection an initiative was designed by HR team for their BAGIC employees to give references for the prospective candidate. Talport introduces robotic amp- video interviews for the job seekers and with the same they can apply for a job post and appear for interview.

Customer control and experience

In 2016, I saw that non motor policyholder are behaving like the motor insurance policyholder and switching when they are unhappy with the services or price. Many still have the strong relationship with their insurers. Customer engagement with insurance company is still poor and majority of the insurers are continue to re-invent their customer experience such as looking individual transactions and provide virtual presence by texting and email.

Insurance sector are exploring automation in their operations that accelerate instant decision making across the value chain. Back office operations and other task are automated by Artificial Intelligence, Robotic Process Automation (RPA), and Block Chain. For example:- According to Association of British Insurers, AIG has recently received Federal Aviation Administrator Approval (FAAA) for commercial use and for testing drones to assess the property damage that ensures claim processing in a shorter period of time, changing customer expectations with the new technologies and the new entrants in the competitive market. The journeys of insurance claims from loss notification to settlement seen as a cost center only, but in the upcoming future insurers have to redefine their claim management process. It is a very complex issue at the time of claim settlement when customer wants to recoup their loss. As a tech oriented companies should have to provide 24*7 and served them on real time basis.

The terminology of value chain of the insurance sector involves direct distribution, underwriting, policy issuance and claim settlement. In underwriting the insurance companies are developing peculiar solutions that can be used by the carriers for improving their underwriting performance. Hence, insurers are incorporating underwriting management system (UMS) that consolidate risk information. In policy issuance the companies are offering apps that enable the agent or the IMD’s to take care of this function like premium payment. For example: - The concept of virtual office has firstly incorporated by the leading general insurance company named BAJAJ ALLIANZ enables the VO heads through the Ezee tab application to take care of the functionalities of the insurance such as policy issuance, pre inspection , IDV calculations , claim registration and so on. In Claims with the same application customer can register their query with respect to claim whether it is motor or non-motor insurance which make it effective and customer centric approach. To make the distribution channel more efficient and profitable, insurers are reaching directly to their customers by removing the unusual intermediaries within the channel of distribution.

Digital transformation are becoming popular a popular tool for marketing of insurance companies through advertisement and to spread awareness among the people. By bringing structured and focused approach, insurance companies play a crucial role in converting the economic scenario of the country. In 2017, it has been found that many insurance companies in India are investing more on acquisition of technology and resources to scale a new platform that makes then to differ from other competitors present in the market. Insurers are also trying to identify pro-actively the risk and manage accordingly and consistently focusing upon replacing their internal system that improves the ability to operate with a digital speed, these replacements will lead them to adapt new products and business models faster as compare to before.

To protect the interest of the consumer IRDA as a regulator comes into the picture by formulating and drafting legal changes of the insurance business in India like recent changes related to third party motor insurance, personal accident linked with motor insurance, 3 and 5 years plans for two wheeler and private car respectively but still a lot need to be require for the improvement for the different segments and handling unnecessary overheads.

As a consequence, when we talk about the future of insurance in India, we are indirectly giving focus upon the global culture and its impact on insurance companies. Consequently every insurer has to re-balance their functionalities without exception. Instances the upcoming future is hidden in a plain sight and expands horizons. The emerging technologies have the power to change everything. The expedition to the upcoming future that is made up of many predictions as a result into many insurance companies in India is still busy in architecting and building their organization. Hence, try to become a “Digital Insurer “of the modern time. It makes their organization easier to broker and other intermediaries to integrate customer experience. Insurance companies need to integrate their internal system and digital platform by introducing digital offerings to customer and becoming more responsive from policy purchase to the payout of the claims. Product development and enabling the digital channel for distribution of the product provides a consistent experience to customer. Data democracy ensures the insurance companies to acquire more information for its mutual benefits. In India around 10 % of the insurance market share has been covered by both LIC and GIC and remain is still untapped segment including the large portion of the rural segment? Insurance market in India offers ample of opportunities to the insurance companies to serve the entire population.

Conclusion

People usually say change is inevitable but in this modern time this statement is swindle and unsuitable. In today’s time changes are palpitate through culture and society. The future of insurance companies in India are belong to those who can develop and execute a proactive approach rather than offer reactionary to customers , one who seeks opportunities and implement a customer centric focus. The major implications for the insurance companies are “How one can capitalize in drivers to change? “. The upcoming future will bring the definite shift in the insurance industry and with the rise of the competition both public and private companies has to ensure the healthy development of the insurance sector.

 It is estimated that by the year 2030 the operations and channels in the insurance companies will be fully automated. With the rise of the technology insurance companies need to show short and long term commitment to the unreserved rural sector and try to unleash these potential, companies can frame their product offerings that are suitable for the rural people to cater their need and accordingly utilize the appropriate mechanism for channel distribution. Over the time pass on we will seek the digital transformation in the insurance sector that ensures the responsibility to operate with the recent trends into the marketplace.

The way that the traditional business operates is totally exponential. In today’s era one can be successful who change itself with the rate of technology and rebuilt their organization. The goal should be to become digital equipped first and then customer centric, keeping their needs in consideration and response accordingly that helps the insurance company to operate a sustainable business.

The upcoming future is belong to the brave and for one who will be differ from meek and mild, one who should be responsible enough to cater with need for their customer and also to employees. I conclude the future of insurance in India as an interdisciplinary approach of cover and service, separately it become weak and by providing the services with the coverage a company can retain their customer and become loyal for the same.

Opening the reinsurance market brings the new opportunities for the insurance industry to grow and develop localized solutions. IRDAI issued new regulations for the conduct of reinsurance business in India. The market also witnessed the entry of the first private reinsurer and also setting up of the five foreign reinsurance branches in India.