Digital transformation in the insurance industry through collaboration

The insurance industry is facing a number of challenges and opportunities especially on fast changing consumer needs as well as emerging trends such as mobile money, digital banking, and online shopping among others. Collaborations and linkages in the financial services sector are slowly taking root and the insurance industry has not been left behind. However, the insurance industry is embracing collaboration in the digital ecosystems by adopting digital channels in order to reach otherwise unserved markets. Customer are increasingly demanding to get services anywhere any time in locations that best suit their lifestyle. Already mobile banking, internet banking and mobile money have been embraced across the demographic and social economic classes. One of the key technological enablers is the use of device agnostic, online or web-based tools.

Digital collaboration generally means using digital technologies for collaborating quickly and effectively with service providers and customers. The adoption of these technologies and processes will improve customer experience and ease of information access. The most significant impact for insurers will be the internal benefits customers gain. Our world is undoubtedly changing fast, but often not fast enough for the insurance industry. Our customers and intermediaries demand we have the same capabilities they experience in their other daily consumer transactions especially banking and online shopping. Customers, whether individuals or companies, want what is called the Amazon experience. They want a self-service portal, an Omni channel delivery and a personalized experience.

The consumer of today expects a self-service portal on a company’s website. We can empower our intermediaries to have self-service portals for buyers to evaluate products and make comparisons. These portals would allow customers to request and receive insurance covers, track status of policy document issuance and policy amendments. The portal would also be searchable to let customers find information that can help answer questions or provide guidance. The self-service portal would also address the wait times for phone calls or the slow response times to emails, caused by information asymmetry and silos.

The case for collaboration

Motor Insurance certificates are now being issued digitally. This gives an opportunity to provide motor insurance covers on the go in real time. This kind of innovation is very useful to an insurance sales agent in the field. Most insurance brokers have an Information management system in place, typically the intermediary will capture customer data in their system and send instructions to the underwriter to issue the certificate for the same. Once these instructions are received, they are again fed in the insurer’s system. A web-based platform would enable insurers to provide a software as a service (SAAS) with their intermediaries, which would be integrated with the insurers system and Association Kenya Insurance (AKI) Digital Motor Vehicle Insurance Certificate (DMVIC) system to reduce the binding and business closure time. This would enhance the collaborative user experience.

Buyers of insurance are emerging as a disruptive force. They have an on-demand mind-set and expect a lot from their financial service providers. Available research shows that banks are way ahead of insurers in satisfying the needs of their customers. The move to digital insurance, Insurtech has shifted the nature of insurance itself. Insurtech has evolved to meet the needs of insurance buyers on the go/ on demand. For example, with a dedicated platform, large transport companies, or companies with fleets of vehicles would manage their portfolios through a self-service portal. This would enable underwriters to do direct marketing to fleet owners. With increased market competition, fragmentation and disruptions, we must consider walking the digital journey with our service providers/supporters/partners/distributors. Collaboration will be crucial in managing the evolving consumer dynamics and expectations.

Contextualising digital collaboration

A digital collaboration tool may be defined as a web or cloud-based software that allows its users to work together towards achieving a shared goal. Digital collaboration tools allow users to work smarter in an increasingly virtual working environment with easier access and connections, as well as improved information sharing while reducing information asymmetry and silos. It is the combination of people and technology working seamlessly together so they can communicate and work more effectively. The benefits that can be realised from this technological and cultural shift towards digital collaboration are as follows;

Building deeper business relationships with insurers’ service providers, supporters, partners and distributors.

Opportunities to improve speed to market new products and services.
Opportunities for immediate service delivery with reduced turnaround times
Productivity gains and time savings in decision making with faster reviews.

Insurers need to recognise that walking the digital journey with their service providers, supporters, partners and distributors will ultimately benefit both parties; hence, the need to seize the opportunities presented by new technologies and business models, as they also offer excellent partnership opportunities and better relationships with intermediaries and customer touch points.

Insurance as a service Platform

Insurance companies need to create a web-based platform that their service providers, supporters, partners, and distributors would use to facilitate and manage day-to-day business. Generic features of the web based platform (a SaaS) would be providing quotations, managing policies, claims management, a premium calculator, partner or channel management, lead management, customer management, policy administration, renewal reminders, birthday wishes, financial reporting and reconciliation. The platform would ideally automate the entire customer life cycle and would connect to several services and apps including Office 365, Gsuite, LinkedIn, Facebook, Twitter, Instagram, PayPal, Stripe, Pesapal, a Mpesa Paybill and a web content site (a dedicated website and informational repository/blog). This platform would be connected to insurers information systems through Application Programming Interface (API) to facilitate real time data processing. The SaaS would even enable real time premium collection where each new account (intermediary) would be issued unique mobile money (Lipa na Mpesa) till number (or their existing is integrated). This would ensure insurers have sustained business relationship with renewed emphasis in digital inclusion, supporting our partners in their digital journeys’ and superior customer experience. This would ensure guaranteed business growth and retention.

In the short term, this can be offered as a self-serving platform for motor insurance, that would complement existing Apps or Web platforms. In the long run, insurers can develop commercial Software as a service (SaaS) or (Insurance as a Service (IaaS)) platform that would generate revenue, increase transparency and deepen relationships for the organization and service providers, supporters, partners and distributors.

Some examples of local Saas (Iaas);

LAMI https://www.lami.world/ that provides a digital insurance gateway. The Griffin App https://joingriffin.com/ being the publicly available project done. d.o.t.s https:// dots.ke/ that provides SaaS. An implementation being the website https://vehicle.co.ke/ that provides motor insurance and accompanying services (by Ken Bright Insurance Brokers) being the most relevant example

Building deeper business relationships with insurers’ service providers, supporters, partners and distributors.