Technology enhancing green finance and sustainability in Insurance Sector

Vivek Chaturvedi

India as a country has set a target of achieving net-zero emissions by 2070. Hence, it is pertinent that the insurance sector, too, thinks of ways to promote green finance and sustainability and plays an active role in achieving this goal, shares Vivek Chaturvedi, Chief Marketing Officer and Head of Direct Sales, Digit Insurance, in an exclusive interaction with Shruti Jain of Elets News Network (ENN).

How has technology impacted your marketing strategies, and what new trends are you seeing in this space?

Marketing strategies involve making decisions about what, how, and where to communicate about a product, feature, service, or brand. The communication mix requires a blend of creative and media decisions, with the “where” component dependent on where the target audience can be found in the most receptive mind state at the best cost and interaction experience.

An ecosystem of technology products based on AI, ML, or data learning is used to provide insight and efficiency in planning and executing creatives and campaigns. Various technologies determine which creatives work best, and media tracking enables marketers to refine strategies. Simple UIs allow for the simulation of marketing strategies and real-time results. Traditional mediums like outdoor and cinema also use tech solutions for tracking and reporting.

Additionally, it is also important to note that marketing encompasses not just advertising, but also product creation, journeys, and post-sales experiences, which are all heavily reliant on technology to identify the right customers, offer the best-suited product, and provide a curated post-sales experience. In short, technology is ubiquitous in the marketing space.

As for trends, the use of AI and ML in marketing is gaining momentum as companies seek to enhance the scalability, customizability, and precision of their creatives and outreach. Despite this progress, some aspects of marketing remain too complex to be replaced entirely by technology.

  • The growing media clutter is an ongoing trend as brands vie for customer attention, making creative breakthroughs increasingly critical. The lines between content creators and consumers have blurred, necessitating a diversified content strategy tailored to the various consumption channels.
  • Linear narratives and traditional brand building are no longer the sole options for brand storytelling, given the surge of new media properties. Innovations in this field are set to become crucial.
  • Automated purchasing is central to creating a good user experience, as one-touch-todone becomes the preferred approach.

What is the range of new products and services in your organization to disrupt the Indian general insurance sector? How is it redefining the insurance industry by working digitally?

Digit is renowned for its unique product offerings in the insurance industry. Last year, we introduced India’s first pay-as-you-drive add-on cover for motor insurance. It provided a discount of up to 25% on annual premiums for low-usage vehicle owners. We also unveiled a motor self-inspection claims process that enables customers to upload photos of their vehicle, and an AI-supported model detects any damages. This reduces the pre-inspection process from 7 days to 7 minutes by eliminating the need for a manual surveyor.

This year, we have expanded our health portfolio to cater to evolving health insurance demands. Our three new health plans are:

  • Digit Double Wallet, which grants policyholders access to double the SI chosen in the same policy year as a backup SI.
  • Digit Infinity Wallet Plan, which allows customers to make several claims throughout the same policy year with unlimited backup SI.
  • Digit Worldwide Treatment, which offers policyholders treatment anywhere in the world, including India.

Moreover, our products and services are supported by AI-powered microsystems, or bots, to enhance efficiency in functions like underwriting, servicing, claims, and onboarding. By utilizing familiar front-end technology, we provide a top-notch customer and partner experience while minimizing our employee count. Our AI-powered sentiment analysis model detects emotions in audio and text formats, allowing us to alert team leaders when a high negative score is detected. Additionally, our intent-classification AI engine predicts the purpose of incoming emails, prioritizes them, and generates automated responses, boosting efficiency and decreasing response time. Furthermore, we offer self-service options with 24×7 live chatbot assistance on messaging tools like WhatsApp and our website for customers and partners.

What role can Digit Insurance play as a regulator in promoting green finance and sustainability in the insurance sector?

India as a country has set a target of achieving net-zero emissions by 2070. Hence, it is pertinent that the insurance sector, too, thinks of ways to promote green finance and sustainability and plays an active role in achieving this goal. Tech, for instance, can play a huge role in pushing sustainability in the sector. For example, Digit has a near-100% paperless process powered by its technology, thus significantly reducing carbon footprint. Reducing physical inspections and using AI and ML for policy issuance or claims settlement, too, aids in reducing the overall carbon footprint.

IRDAI, too, has taken multiple measures to encourage ESG investing and promote sustainable development. Investments, for example, done in green bonds are treated as “investment in infrastructure” by the insurance regulator. This will encourage more insurers to invest in sovereign green bonds.

For better impact, insurers need to come together and think of devising ways to integrate ESG activities throughout their business operations. ESG investments is becoming more common now, even though it’s still at a nascent stage in India. All these measures can ensure that insurance as a sector plays an active role in promoting green finance and sustainability.

In what ways is technology shaping the future of InsurTech? What potential opportunities exist for InsurTech in the market?

Insurtech’s future is being shaped by technological innovation, which has enabled insurers to offer a more seamless experience to customers—from buying policies to filing claims. To stay ahead in a competitive market, insurers need to adopt technologies that enable them to innovate their product offerings. Here are a few technology trends that are shaping the future of insurtech:

1. Automation: Automation is a powerful trend that has emerged in recent years, reducing manual work and improving customer experience. Automated workflows for claim processing and pre-built RPA use cases for insurance policy issuance and automated underwriting allow insurers to focus on personalized customer service while RPA verifies and validates essential documents to prevent losses due to duplication.

2. Artificial Intelligence: Insurers are leveraging AI to process unstructured data, predict renewals, and automate claims pay-out. In motor insurance, AI is used for pre-inspection, where customers submit real-time photos and videos of their vehicles. Travel insurers use AI to automate claim pay-outs for flight delays or cancellations, enhancing efficiency and customer experience.

3. Cloud computing: The scalability and elasticity of the cloud are strengthening insurtech companies. By hosting core management systems on the public cloud, insurers can reduce time-tomarket, run complex AI models, and provide a better customer experience.

4. Telematics: Vehicle manufacturers are increasingly accepting telematics, which can transform motor insurance sales by evaluating driving behavior to assign personalized premium pricing. Insurers can offer need-based policies while collecting data on driving patterns to promote road safety.

Apart from these technology adaptions, insurtechs also offer the insurance industry several opportunities, such as personalized products, mobile apps, and social media to engage with customers, improving customer loyalty. By automating tasks such as claims processing, insurers can improve efficiency, and reduce processing times and costs. Risk assessment can also improve through data analytics and machine learning algorithms, with accurate pricing and reduced risk exposure. New distribution channels such as online marketplaces and mobile apps help reach new customers and expand market share. Finally, insurtechs are also driving innovation through new products and services, meeting changing customer needs, and keeping insurers ahead of the competition, and providing value.

Looking ahead, what do you see as the biggest challenges and opportunities facing the insurance industry in the years 2023-24?

The insurance industry will encounter both challenges and opportunities in the upcoming years. The constantly evolving technological landscape presents both challenges and opportunities. Insurers who invest in advanced technology will have the chance to develop innovative products and gain a competitive edge. Those who fail to do so risk becoming irrelevant or unable to meet evolving customer demands. Additionally, cybersecurity is becoming a growing concern as more data is processed by insurers.

However, there are also opportunities for growth and innovation in the industry. The demand for personalized insurance products and data-driven solutions is increasing. Furthermore, changing demographics and consumer preferences are creating new markets for insurers to expand into and offer new services, such as long-term care insurance for the aging population and sustainable products for the environmentally conscious. In addition to this, the newer regulations by IRDAI also call for product innovations and encourage insurers to improve their businesses, expand into new markets, and built trust with their customers. Insurers who are able to navigate the regulatory landscape effectively can gain a competitive advantage in the insurance market.

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