Today’s new age consumer lives in cyber space with their entire world squeezed-in on their smart phones. Right from business to entertainment, all rests in these small devices. Their interaction with the world is now largely reduced to these devices. They research, seek counsel from their friends and other consumers in the social world before they buy. Gone are the days where it was easier for insurance agents to seek appointments to convince the customer. This is forcing insurers to change the way they solicit business with digitally evolved consumer. In the Omni channel world, consumers control how they want to be reached out to for solicitation and when they would buy a product or service. Insurers are exploring and adopting new age technologies to engage with this set of customers.  Customers no longer hesitate in buying complex insurance products on their own online. It is also heartening to see the increase of STP in the online segment which means that customers do not even need telephonic assistance while choosing or buying an insurance product online.

With shift in paradigm, conventional set of technologies like Customer Strategies (with Customer Relationship Management) are taking a backseat and are being replaced by Digital Strategies. Business models are changing rapidly and getting built around Technology. With digitally evolved consumers, innovations in products and services have gone to the next level. Analytics, Machine learning, Robotics, Social networks coupled with Internet of Things (IoT) are creating a new opportunities for innovators in the Insurance space.

According to Gartner, there will be over 26 billion connected devices by 2020. While IoT is essentially the linking of physical objects with sensors embedded, the technology is slowly altering the way people use these “things” conventionally. Telematics, health fitness devices, connected homes are creating opportunities to create differential products and services. IoT devices are getting effectively used to track shipments. The ability to geo-fence the movement of vehicles provide real time traceability and helps logistic companies control theft resulting in reduced losses to insurance companies. So, as the technology evolves, so does their use.

 Insurers are also trying to exploit technologies to differentiate high risk from low risks and come up with differential product and pricing for both retail and corporate customers. Powered with technology insurers are thinking beyond distribution and focusing more on value additions for customers and investing in technology start ups. Efforts are to work with corporate customers on effective risk management strategies by technologically enabling them so that industrial accidents and disruptions are avoided. IoT devices like fire and water leakage sensors can stop several damages to the industries. IoT sensors can help worker handle assembly safely and thereby avoid personal injuries, lowering absenteeism and higher productivity. This in turn helps insurers, minimize losses arising out of business interruption of clients due to industrial accidents.

For retail consumers, insurers have been integrating IoT devices with health insurance thereby encouraging healthy living in customers. It’s a win-win situation for customers. Increasing adoption of mobile wallets and access to digital world has opened new opportunities for insurer to reach out to consumers in various towns and villages in a cost effective manner and design innovative products suiting various segments. A connected eco systems of agents, brokers, customers is helping build a business model, where information is accessible to all stake holders on finger tips, making it easier for agents and broker to sell and service customers in real time.

Due to increasing influence of social media, Social CRM is gaining prominence. It has become critical to develop social listening capabilities and engage with customers effectively, to build and manage brand reputation and also provide an additional channel of communication to customer. HDFC ERGO effectively utilizes this mode and engages with its customer with the help of Social CRM systems. We have also invested in building a Community, which is accessible at which helps consumers engage at a peer to peer level. Such platforms help increase the insurers reach to a larger consumer base and build its brand. 

With booming digital foot print vast amount of data is being generated. Insurance is a business of data science and therefore, Big Data analytics is taking the center stage in the business strategies of insurers and companies are investing heavily in building technical and analytical capabilities for effective mining of the data.   Data intelligence is helping insurers get unique insights into customer behaviour and preferences, fraud detection, marketing, medical informatics and more. 

While Banks have been the early adopters of m-commerce among all financial services providers, Insurance companies also are catching up fast with innovative Mobile Applications, offering customers another channel to connect and transact. Today, almost every insurance provider – life as well as non-life – is offering mobile apps to its customers for value-added services. At HDFC ERGO we offer the “Insurance Portfolio Organizer” (IPO) mobile app as a service to policyholders. This organizer is currently used by over 2.5 lakh policyholders through the company website and also on Mobile phones as an app. Taking a step forward, we launched the IPO app on the Apple Watch, especially for HDFC ERGO policy holders, making crucial information related to their policies available at a tap on the Apple Watch.

This unique convergence of Technologies like, data sciences, mobility, IoT, Artificial intelligence (AI) is set to change the way insurers did business in past and will open new avenues for innovation of products and services. On one hand technology will help simplify huge transactions and bring efficiencies, digital, on the other hand will facilitate seamless distribution in a cost effective way with AI and analytics automating underwriting and fraud controls.

Mr. Mehmood Mansoori - Member of Executive Management & Group Head
HDFC ERGO General Insurance Co. Ltd.

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