Insurance sector being transformed by data
When insurance clients are willing to share data with insurance providers, it empowers the customers because the sector can tailor products to their needs, rather than using a ‘one size fits all’ approach, says Andries Smit, managing director, Asia digital, for United Kingdom-based insurance group Aviva Plc.
He was speaking during a panel session called “Sleeping Dragon – The growing Insuretech opportunity” at Next Money Asia’s Fintech Finals 2018 in Hong Kong, an event for StartmeupHK Festival 2018, coordinated by Hong Kong government’s InvestHK agency.
“When customers give us access to data,what that allows us to do is to tailor make policies with the risks that they face,” said Mr Smit. “We changed our mindset in the last three or four years from pushing products and specific lines of business,” to more bespoke offers for the insured parties, he noted.
“A classic example is one around diabetics. If we wind back 20 or 30 years, most insurers wouldn’t touch diabetic consumers,” he stated.
Nonetheless, the industry now takes the view – based on data sharing and analysis of such data – that a “well-balanced and –managed diabetic patient” is actually better in terms of risk management than some other customers.
“We found in the U.K., that by making a policy that is specific to that lifestyle… as long as they [the insuree] manage it… whether it’s with their employer or by direct communication” with the insurer, such clients can have a “fantastic financial outcome on the back of that,” said the Aviva executive. “We see that mutual understanding… is helping towards financial inclusion.”
Another speaker on the panel, Roseline Koo, chief executive of Singapore-based CXA Group Pte Ltd, said that access to insurees’ healthcare data, and analysis of that data, was a key focus for its business. The technology start-up was founded in 2013.
“We help employers redeploy the money they spend on insurance for all their employees, into early detection and disease prevention,” she explained. “This is primarily because in an age of chronic disease, it is causing premiums to escalate into double digits.”
Under CXA Group’s business model, each employee of the client company is provided with an E-wallet and recommendations on how much insurance they need, and with information covering – as appropriate – disease management; weight management; smoking cessation; even access to gyms. “We look at everything,” stated Ms Koo.
“The largest banks have ‘white labelled’ our platform, so they can cross-sell a version of this to the employees of the small- and medium-sized enterprises they give loans to,” she explained, adding CXA Group was now operating in 20 countries across Asia, and “also hitting the United States”.
She added that the firm had just won a contract in a province of mainland China where there are 20 million residents.
Aviva’s Mr Smit said that although traditional insurance businesses covered a wide range of disciplines – including property and casualty, life, health and asset management – his firm was “not arrogant enough” to think it can “do it all”.
“We realise that via partnering, it is so much faster, so much better, and it scales,” he stated, referring to the potential for collaborations with digital technology start-ups.