The prolonged pandemic crisis posed a series of challenges for the entire insurance industry. And the challenges demanded the need to quickly shift to a technology-based model to maintain business continuity and ensure resilience. In a bid to understand the role of digitisation across the insurance sector amid uncertain times, Elets News Network (ENN) interacted with Rikhil Shah, Chief Financial Officer, SBI General Insurance. During the interaction, Shah spoke about the increasing significance of Digital-first business model, Advanced Analytics and Machine Learning.
Excerpts of the interaction:
What kind of investments the insurance industry needs to make in digital transformation to stay agile?
The next few years will require companies to understand the digital customer and meet their evolving requirements. Hence, the industry will require constant upgrades in services, bridging the gap between rural and urban, online/offline interactions or experiences, smart chatbots with personalized/unique conversations and more.
A Digital-first business model is the only way to move forward. Remote working, digitized processes, omnichannel and round-the-clock customer service, a smart workforce, usage of RPA, AI/ machine are increasingly becoming necessities rather than being an option. To stay agile and future-ready, the insurance industry needs to invest in easy-to-work technology, fostering effective and quick dissemination of information. Internet of Things, Advanced Analytics and Machine Learning are some of areas that are picking up pace like never before. Today, AI and Automation are emerging as the core elements for digital transformation.
Insurers much carefully evaluate digital requirements and risks for each line of business and invest accordingly. Short and long-term implications need to be considered. At SBIG, we believe investment in technology is certainly worth and shall yield long-term benefits. We constantly try to innovate and improve our systems to stay ahead.
As a CFO, what initiatives have you planned & executed to support the new normal?
Post-COVID, we have taken quite a few initiatives. One of the significant things has been the strengthening of digital platforms. This ramping up of digital infrastructure was required by Customers and employees alike. At SBI General, we have been leaning towards process automation and taking measures in that direction for a while now. On our employees’ front, between the lockdown restrictions and relaxations, through various digital initiatives, we ensured that their productivity is not impacted.
With the impact of pandemic, the need for retail health policies and product specific SBUs saw a spike, and so we managed to address this need and thereby specific customer requirements. To maintain the financial health of the company, we continued our revenue growth without impairing profitability.
However, the insurance industry is based on personal equity, so while organizations focus on digital marketing, physical scalability is also important. It is what we have come to call – ‘Phygital.’ We are also planning to invest substantially in manpower and technology, which are the pillars of a successful organization keeping in mind the customer touch across each channel.
The discussion has shifted a lot to digital distribution partners, and most GI companies are partnering with various digital aggregators/service providers, insurtech firms to increase reach with cost efficiency. We have had many such partnerships to increase reach and availability to a more diverse group of customers. They have certainly complemented the traditional network.
Technology has played a major role in supporting the insurance sector amid the crisis. As a CFO how did you leverage it in your workspace?
To begin with, end-to-end digital onboarding for our customers has been a major step in leveraging technology while working. This has helped us serve our customers in a developed manner. Most activities such as filling in applications, verifications, KYC through Video, and many such important activities are being done digitally today. We have also used 360-degree view of customer activity across touchpoints to understand the consumer experience with our bank. The 360-degree view helps us gain insights into customers’ expectations about our services and helps us deliver the right services at the right time with a touch of personalization. We use predictive analytics to upscale our cross-sell activities, which will help us analyse the past program as a starting point. To conduct this analysis, we focus on policy characteristics, demographics, and the profile of buyers. Talking of the investments, we are constantly investing in Core systems, CRM, and AI to make the operations much easier and efficient based on complete technology-based solutions. We are inclined towards operating on a virtual mode for low-cost penetration. This way, we will be able to optimize our resources and reduce costs simultaneously. RPA and AI have formed significant parts of curating a positive and personalized customer experience specifically for claims. So, to deal with claims, our focus lies heavily on RPA and AI now. We are also incorporating automation for claims payment. Through automated claims payment, we can close claims faster with the added advantage of cost efficiency and increased customer satisfaction. This has been highly advantageous as compared to the manual inspection. RPA is being used to keep track of payment of the total premium in advance for the bank to assume risk. RPA is also used for implementing tax liability confirmation. The MIS reports are being automated to help in easy and quick analysis and visualization of information.
What models did you have in place to assess the potential risks during the pandemic outbreak?
We at SBI General had an efficiently monitored Business Continuity Plan (BCP). As an insurance company, we have a crucial role to play and stand by our policyholders in the hour of need. Hence, we took a balanced view of our employees’ health & safety and commitment to our customers. People and Customers have always been at the center of all our activities.
Since the outbreak of COVID 19, as the situation demanded, Emergency Management Team (EMT) was brought in action to manage the crisis at ground level and ensure that the company adheres to the required government & regulator guidelines. SBI General also ensured that the Customer Care channel was constantly supporting the customers. Our claims team will continue to support our policyholders and Call Centers with optimal resources to ensure essential customer care services to our policyholders. The company has taken appropriate action on the underwriting front to confirm the closure of new and renewal business so that no inconvenience is caused to its customers. To this end, the company has provided appropriate decentralization of powers to enable quick decision-making.
How did AI, IoT help your business models to recover from the impact of the crisis & be resilient?
The prolonged pandemic crisis posed a series of challenges for the entire insurance industry to battle. However, we transformed our functioning to a certain extent to help the business to recover. To begin with, we initiated the use of AI and Machine Learning as an integral solution to the crisis. This technology was majorly used for investigation and claim assessment. RPA is highly used for the day-to-day activities that will help us carry on the operations, unhindered. This has led to better efficiency at a reduced cost. Integration of technology across the value chain contributed significantly to recover from the ongoing crisis.