Unlocking The Power of Gen AI: A Tech Odyssey in Insurance Innovation

Dheepak Rajoo

GenAI will enable insurers and bankers to enhance their customer experience, risk management, and decision making, by using natural language processing, computer vision, machine learning, and deep learning techniques, shared Dheepak Rajoo, Chief Information Officer, Royal Sundaram General Insurance Co. Limited in an exclusive interaction Srajan Agarwal of Elets News Network (ENN).

Considering the dynamic and competitive landscape of the general insurance sector, what do you identify as the most significant challenges and opportunities your organisation faces? How do you plan to leverage technology and your expertise in digital transformation to address these challenges and capitalise on these opportunities?

Let me outline the ABC’s of challenges and opportunities facing the general insurance sector.

  • A stands for “Awareness” problem at the consumer end – Insurance penetration in India continues to be low, and density of Insurance products among rural areas is low among comparable economies. There is a correction we see here especially for insurance protection among customers, especially in the wake of the COVID-19 pandemic.
  • B stands for “Bias” in the buying process, which continues to be dominated through distribution, which is strongly intermediated, be it your neighbourhood agent, or your vehicle dealer, broker, or aggregator. There are emerging opportunities in segments and products like Motor (EV), Health (Embedded/ Sachet Products), Travel (Affordable products) etc.
  • C stands for “Competition” from new digital-only insurers, PayTech companies distributing small ticket-sised policies
    to customers as a corporate agent. Increasing customer expectations and demand for personalised, convenient, and transparent services has also paved the way for innovation and collaboration opportunities with ecosystem partners such as Banks, Telcos, e-Commerce and Health & Wellness providers.

To address these challenges and capitalise on market opportunities, we plan to leverage technology and our expertise in digital transformation in the following ways:

  • We aspire to innovate and launch new products and services that cater to the evolving needs and preferences of our customers, such as parametric insurance, usage-based insurance etc
  • We seek to collaborate and co-create with our ecosystem partners to offer holistic and integrated solutions to our customers, such as embedded insurance, bancassurance, and appropriate cross-selling.
  • We aim to enhance our digital capabilities and offerings across the entire value chain, from product development and distribution to underwriting and claims.
  • We intend to use data and analytics to gain deeper customer insights, improve risk assessment, and offer customised and dynamic street pricing.
  • We strive to improve our operational efficiency and compliance by automating and streamlining our processes, enhancing our security and governance, and adopting agile and cloud-based platforms.

You successfully streamlined and improved compliance and reliability by overhauling the top 10 critical IT processes at RBL Bank. What were the major challenges you faced during this overhaul, and how did you address them to ensure improved efficiency and compliance?

The overhaul of the top 10 critical IT processes at RBL Bank was a challenging but rewarding program that aimed to improve the compliance and reliability of the bank’s IT operations. Some of the major challenges we faced during this overhaul were:

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  • The legacy IT processes were outdated, manual, and siloed, resulting in inefficiencies, production errors, and resultant operational risks.
  • There was general resistance to change and adoption to new processes, tool chains and ways of working.
  • The IT vendors and partners were not aligned with the bank’s vision and
    objectives, and had conflicting priorities, and expectations.
  • The IT infrastructure and environment were complex and heterogeneous, requiring careful planning and testing of the changes.

Some of the ways we addressed these challenges were:

  • We conducted a thorough assessment and gap analysis of the existing IT processes and benchmarked them against the industry best practices and standards, such as ITIL and COBIT. We chose to work with Industry practitioners (ex CIOs of Banks) instead of management consultants, since the problem area was already narrow and clear.
  • We designed and implemented the new IT processes, using a bunch of process automation tools (mostly open source) to enable end-to-end visibility, control, and optimisation of the IT activities.
  • We engaged and trained the IT staff on the new processes and tools, and
    established clear roles and responsibilities, performance indicators, and feedback mechanisms.
  • We collaborated and communicated with the IT vendors and partners, and established service level agreements, governance structures, and escalation procedures.
  • We upgraded and standardised the IT infrastructure and environment, using cloud and virtualisation technologies, to enable flexibility, scalability, and resilience.

Given your extensive experience in digital transformations and IT modernisation, what emerging technologies or trends do you believe will be crucial for the insurance and banking sectors in the near future? How should companies prepare to integrate these technologies into their operations?

The insurance and banking sectors are undergoing rapid and profound changes, driven by the emergence of new technologies and trends. Some of the emerging technologies or trends that I believe will be crucial for these sectors in the near future are:

Generative AI: GenAI will enable insurers and bankers to enhance their customer experience, risk management, and decision making, by using natural language processing, computer vision, machine learning, and deep learning techniques. For example, AI can help in providing chatbot and voice assistant services that can interreact with customers in their native languages, detecting fraud and anomalies, and offering personalised recommendations and advice.

Blockchain: Blockchain will enable insurers and bankers to improve their trust, transparency, and efficiency, by using distributed ledger, smart contract, and tokenisation technologies. For example, blockchain can help in verifying the identity and credentials of customers and partners, streamlining the claims and settlement processes, and creating new business models and products, such as peer-to-peer insurance and tokenised assets.

Internet of things (IoT): IoT will enable insurers and bankers to gain real-time and granular data and insights, by using sensors, devices, and networks. For example,
IoT can help in monitoring the health and behavior of customers and assets, offering dynamic and preventive services, and enabling new modes of interaction and engagement, such as wearables and biometrics.

Cloud computing: Cloud computing will enable insurers and bankers to increase their agility, scalability, and innovation, by using on-demand and pay-per-use services and resources. For example, cloud computing can help in enabling faster and easier deployment and integration of new applications and solutions.

Open Architecture: Open Architecture adopted by Banks will enable insurers and bankers to offer more choice, convenience, and value to their customers, by using Application Programming Interfaces (APIs) and data sharing protocols. For example, providing customers access to a wider range of products and services by making sense of curated data sets offered by account aggregation players, and other 3rd party providers.

To prepare to integrate these technologies into their operations, insurers and bankers should:

  • Invest in building their digital capabilities and culture, such as data and analytics, agile and DevOps, and design thinking and innovation.
  • Partner and collaborate with the technology providers and enablers, such as fintech and insurtech startups, tech giants, and regulators.
  • Experiment and learn from the best practices and use cases, both within and outside their sectors and markets.
  • Adopt a customer-centric and value-driven approach, focusing on solving the real problems and needs of their customers and stakeholders.

Looking forward, what are your primary goals and initiatives as the CIO of Royal Sundaram General Insurance? How do you plan to leverage technology to drive innovation, enhance customer experience, and maintain a competitive edge in the insurance industry?
e. As the CIO of Royal Sundaram General Insurance, my primary goals and initiatives are:

  • My number #1 priority is to improve overall Business-IT alignment, so we deliver maximum shareholder value.
  • Our customer experience is a bit fragmented across channels. We wish to work with cross functional teams to significantly enhance customer experience by offering friction-less, error-free, convenient, and transparent self-services. Build customer friendly, chatbot and voice assistant services, dynamic and preventive services, and embedded insurance, and cross-selling.
  • To drive the digital, transformation, and innovation agenda of the organisation, by launching new products and services, such as parametric insurance, usage-based insurance etc by collaborating with our ecosystem partners, such as banks, telcos, e-commerce, and health & wellness providers.
  • To enhance the digital maturity and readiness of the organisation, by Refreshing/Re-architecting/Re- Platforming our IT Application & Modernising the underlying infrastructure, systems, and processes. EXperimenting with cutting-edge technologies like Generative AI and Cloud computing and finding ways to integrate them into business-as-usual
  • Finally, building a performance culture and upskilling staff to future-proof the organisation.
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