Digital Thinking in Health Insurance

8th Annual Health Insurance Conference Asia 2014

18th June 2014 , Singapore

Using Digital Thinking to Transform Individual Health Insurance

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4 Discussion Points

It is a digital revolution

Digital = customer centricity

POS Tablet Toolkit to start a revolution?

3 other digital innovation opportunities?

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Slides @the-digital-insurer.com/8th-annual-health-insurance-asia-singapore/

1. It is a digital revolution







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The Digital Revolution: “It will not be televised”

Digital Convenience

• Always on

• Always there

• Universal

• Almost free

Digital Connectivity

• Access to information (Google)

• Access to each other (Facebook)

• Access through devices (Apple)

• Location-agnostic (cloud services)

Digital Expectations

• Data “on demand”

• Desire for clarity & simplicity

• Dialogue not monologue

• Easy to promote a product .. and complain

Change, Change, Change�.

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Two digital “Mega” trends : Forces beyond anyone’s control

1. Technology is cheaper and easier to implement than ever – it is the fulcrum to meet consumer needs, reduce operating costs and to change your culture

2. Changing consumer behaviour – they are more demanding and looking for a different experience

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Asia: Moving rapidly to a smartphone majority

Source: www.our,mobileplanet.com

Smartphone Penetration 2013

““It is worth noting September 2013 as a significant milestone, as it is the month when sales penetration reached the halfway mark: when one in every two mobile handsets purchased in the region is now a smartphone.”

Gerard Tan

Account Director Gfk Asia

2. Digital = customer centricity







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3 changes in customer behaviour

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1 Research on-line and purchase

anywhere

2. Multi-channel service

3. Less Trust in

Financial Services brands

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#1: consumers research on-line & purchase anywhere

Source : www.consumerbarometer2013.com .

Around the world 69% of the online population researches on-line

before purchasing a product or service

46% research online /purchase offline23% research online / purchase online

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Is Financial Services different? Not really

For Finance and Real Estate it is 67% around the world

Source : www.consumerbarometer2013.com .

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Is Asia different? Not really

In India it is 65% and in China it is 74% for Finance and Real Estate.

However, a higher % of purchases are currently made offline (reflecting

face-to-face channel dominance).

Source: www.consumerbarometer2013.com .

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The hybrid customer is�

• Better informed• More demanding• “Multi-channel” for both sales &

services• Will jump service channels at any

point – catch them if you can!

The Hybrid

Customer

Face

To

Face

Online

Phone

Myth #1: Digital is a new distribution channel

Reality : Digital enables customer (& distributor) engagement

#2: welcome to Digital Customers: “They are hybrid” (or omni-channel)

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Multiple source of information – “mono” communication channels no longer exist

Extracted from Swiss Re Sigma 06/13

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#3:Trust is at the heart of financial services. ButM

15Source : Edelman 2014 Trust barometer

WE HAVE A TRUST

CHALLENGE

71% would rather go to the dentist than listen to what their banks are saying to themSource: survey by Viacom

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3 Core “Digital Thinking” Strategies

1. Manage existing models for

profit

2. Transform existing face-to-

face models so they are more

customer centric

3. Create or participate in new

customer centric models16

3. POS Tablet Toolkit to start a revolution?







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Anchored to basics: Digital Advisor strategies need to leverage insurance fundamentals

Current Agency Paradigm Digital impacts

Trust is at the heart of insurance

� Rely on agent relationships

� Insurance brand is a hygiene factor in the sales process

� As customer research on-line trust will need to be developed and leveraged on-line

� Trust must be earned & reinforced at every interaction/touch point

Great insurance advisors -always in demand

� When customers research online they will research their advisors as wellM.

� Less time face-to-face – but no less important (probably more so)

� Insurance advisors need to be more mobile (digitally & physically)

� Digital will transform & standardise key management processes

� Lack of standardisation in training, performance management & coaching

� Result : variable quality of advice and low productivity resulting in high agent turnover, low policy persistency

Customer service matters

� Nearly 100% reliant on the advisor

� Back office is M back office

� Mobile technology provides opportunities for cost effective customer service differentiation

� Push based communications can be used to reconnect with customers

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Myth #2: Digital changes the way insurance is soldReality: Digital strategies must incorporate the fundamentals

Lead / Prospect Management

Sales

Opportunities

Tablet

Advisor

Portal

Policy Systems

The Digital Advisor

Business Model

CustomerPortal / App

Digital Advisor business model: www.the-digital-insurer.com/digital-insurance-the-digital-advisor-business-model/


Sales

Opportunities

Tablet

Advisor

Portal

Policy Systems

The Digital Advisor

Business Model


Digital Advisor business model: www.the-digital-insurer.com/digital-insurance-the-digital-advisor-business-model/

1. Transform

Leads

2. Transform

Service

3. Transform

Sales

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Advisor

Portal

Policy Systems“connecting the eco system”

Tablet toolkits

Sales

Opportunities


Tablet


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Tablets: a new communication medium

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Tablet sales toolkits: will be “business as usual” in most markets within 5 3 years

1. Present credentials (materials)

2. Identify needs

3. Produce quotes and help to close

4. Easy proposal submission

5. For health : renewal and claim services

Tablet Functionality:

Should be focused on the customer

• Must be designed for advisors to connect with customers

• Easy to use with a “wow” factor that encourages use with clients

• Great usability is critical: engage/delight customers & advisors

Usability is the Key Success Factor

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POS Tablet sales toolkit: easy business case

PRIMARY BENEFIT

Improved Sales

effectiveness through

a better customer

experience

MEASURED BY:

� High tablet usage from

Advisors

� Increased sales

productivity per month

OTHER BENEFITS AFTER SUCCESS

1. Enable lead analytics / predictive analysis

2. Improved compliance to sales best practice (& regulatory requirements)

3. Back office productivity from digital proposals� More efficient

� Faster & more accurate (clean policies in a day)

4. Reduced overheads: premises & technology costs

5. Business intelligence� Benchmarking data

� Usage data

� “Bigger” data

6. Recruitment training (and hiring) tool

7. Platform for more automated underwriting

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Usability = function plus form

“The Dial”Easy, fast, fun & professionalneeds analysis

� High Usage% of Advisors actively using iPoS

0%

25%

50%

75%

100%

Oct 12 Jan 13 Apr 13 Jul 13

Country A

Country B

Country C

Country D

AIA Case study available on-line

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Phase 1

(6 months)

Phase 2

(6-12 months)

Phase 3

(12 months+)

Implement in Phases

1. Present Credentials

2. Needs identification

3. Quote / Close

4. Digital Proposal

Submission

5. Renewal and claims

servicing

Execution Risks

1. Present Credentials

2. Needs identification

3. Quote / Close

4. Digital Proposal

Submission

5. Renewal and claims

servicing

Execution Risks

Functional Area

High risk Low riskMedium risk

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The Health Insurance Tablet Toolkit for advisors

• Resource Centre /Document repository

• Basic Presentation

• Interactive Quote• Comparison quotes

• Quote to proposal• Data capture• Digital signature &

submission

• Integrate to Resource Centre

• Annual renewal (if required)

• Claims resource

• Interactive needs tools including sales scripts

Selling - decision Selling - execution Customer service

4. Three other opportunities for digital Innovation







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Digital Innovation in Individual Health Insurance

Wearable Devices

Content, Wellbeing & Rewards

Digital Brokers

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Wearables: A game for the giants?

Samsung Simband – Open architecture

Google Glass: eyes on the future?

Fitbit – David vs Goliath’s?

Nike Fuelband – still in the running?

2012

June 2014

2013 (beta)

May2014

2013

Apple enters – health toolkit

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Digestibles are already hereIngestion Event Marker – FDA approved

The Password Pill – A ‘super power’June 2012

2013

Amazon has a wearable tech store

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Wearables: impact on Health &Life Insurance

� Increased longevity

� Better quality of life

� Changes in nature of healthcare expensesThe nature of the risk

Marketing of health

insurance

Measurement of risk

� Trend towards selection continues (unless gov’t intervene)

� More dynamic pricing. end state: “telematics” of health insurance?

� Will a healthcare app become the ‘Uber” app that controls access to health insurance

� Products designed for different segments

� Will data privacy concerns become a roadblock?

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Wearable Devices


Digital Brokers

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The case for content

Source : Executive Board (http://www.executiveboard.com/exbd/sales-service/challenger/new-decision-timeline/index.page

Is there any reason why insurance will buck this trend?

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Case for content: we all like it

http://www.bazaarvoice.com/ - the conscious consumer

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Content, rewards & wellbeing

� Awareness

� Education

� Information

� Execution / Fulfilment

What is on-line selling?

Health – designed for

digital engagement

� High demand

� Higher engagement – more tangible

� Opens the door to broader lifestyle content

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Great Eastern is a leading regional life insurer – homegrown in Singapore

Alexa Ranking: 164,285 Global ; 1,638 Singapore

3.1 pages per visit, 4 mins average per visit

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� Dedicated microsite

� >60,000 Facebook users

� Multi– year commitment – content is additive around broad theme “live great”

� Mobile enabled

� Engaging – Guides , health apps, tips , rewards

� Applied across the region

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Did you know ?Great Eastern started its content journey more than 2 years ago

Asian Insurance Review’s Life insurance company of the year 2013

“We are honoured to be named Life Insurance Company of the Year. At Great Eastern, we embrace a simple yet powerful corporate purpose - to not just be a life insurance company, but to be a LIFE company. We have made it our purpose to help our customers to live longer, healthier and better, and over the last two years we have been building our Live Great programme,M. This award is a strong affirmation and validation of our multi-faceted customer engagement strategy across the region.“Chris Wei , Group CEO (Source: Great Easter press release 6/11/2013)

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Getting started: Top 3 content recommendations

1. Create a modern content “factory” - agile with a dedicated leader, external recruits and third party support

2. Invest in content distribution in parallel with content production

3. Co-opt staff and salesforce to support both content production & distribution

Stating the obviousA multi-year budget commitment is required

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Wearable Devices


Digital Brokers

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Would a new entrant set-up a distribution centric model?

� Incumbents have scale

� Operations are complex and inefficient

� Models don’t deliver value to the consumer on the investment component

� Part-time sellers – very hard to manage

� Low productivity

� Product range is too narrow

Agency Channel

Bancassurance

� Has a lot of advantages butM.

� Banks have consistently chosen $$ over customer centricity

� Lacks the personal touch on servicing

� Technology hard to deploy in banking environment

� Existing models are ripe for disruption

� Agency is a cash cow that needs renewal

� Bancassurance is an increasingly expensive game

A personal view for

the life insurance

industry

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There are untapped opportunities

Extracted from Swiss Re Sigma 06/13

Can digital strategies change the paradigm that “life insurance is sold not bought”?

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Digital brokers

� Customer centricity demands choice

� Brokers provide that choiceThe trend to choice

The new digital brokers

How to react?

� Own an IFA

� Own an aggregator (digital venture capital)

� New Affinities

� Choice – lead the change or react to it?

� IFA platforms – with digital enhancements

� Aggregator models

� Affinity Models

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Digital brokers come in many flavoursDigital Choice – life only

Managing agent models

Aggregator models

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Digital health insurance in AsiaBroker comparison models for health

Managing agent models

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Digital affinity

� People trust brands

� Non financial service brands can sell financial services

� Affinities by definition are more customer centricThe Power of affinity

New digital models

How to react?

� Digital Worksite – needs a large employee benefits base

� Digital Brands – Perhaps a Joint venture mentality providing preferred access

� Digital Orphans – leads for digital advisors?

� Digital worksite marketing

� Digital brands: partner with brands with digital connectivity –create a financial services proposition (a new frontier) e.g. airlines, telcos

� Digital orphans

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Digital affinity – brand or workplace?

Digital brand affinity e.g. airline

Digital employer affinity

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Is health insurance enough in a digital world?

� High Engagement

� Personal Relevance

� Profit Margin?

Health insurance

Non - life

Banking

(reverse

bancassurance)

� Credit cards

� Savings

� Loans

� Smaller ticket -first to go on-line

� Customer acquisition

� Customer cross sell

Customers don’t think about industry structures when they

buy on-line

� Low engagement

� High margin

� Becoming easier to sell on-line

Life Insurance

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Concluding: “Business as usual” is the most dangerous path

Be radicalNow is the time to embrace change and start building digital models.

Be CautiousYou don’t need to “bet the bank”. Learn from fast and strategically well thought

our pilot projects (e.g. POS tablet toolkits. Find people with the skills to transform.

B e w a r eIf you don’t utilise digital thinking, plenty of others will continue to do so.

Digital Thinking in Health Insurance

Health & Medicine

Transcript of Digital Thinking in Health Insurance