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The Impact of Covid-19 on the Global Economy and Insurance

3 minutes, 35 seconds read

The pandemic COVID-19 or the well known “Coronavirus” is gradually stretching its limbs throughout the world. COVID-19 has now spread to more than 180 countries with its epicentre in China. Coronavirus confirmed cases reported globally, adds up to 8,60,181 (1st April 2020) and is still on the rise. With the death toll of 42,345(1st April 2020) the insurance companies have to take it on the chin. 

Public gatherings have been banned in several places. For instance, Mipim — the world’s largest property fair is postponed to the later part of the year. Similarly, the Mobile World Conference in Barcelona is cancelled altogether. From the IPL to the world’s premier basketball league to a 250-year-old parade and sprawling festivals, all national and international events are either cancelled or kept at hold indefinitely. Almost every business (likewise insurance) is impacted with corona outbreak and any business cannot rebound in a day.

Referring to the 2008 financial crisis when credit markets seized up, Mr Muri- Wood said, “The only thing we’ve ever had which was bigger than this was the banking crisis.” 

Businesses, Corona and Insurance

Many businesses have insurance policies that are meant to kick in when disaster strikes. But few of those policies are likely to cover pandemic outbreaks. Business interruption insurance, the coverage typically availed by the companies, as part of their property policies, pays cash to make up for lost revenue when a business has to halt operations unexpectedly.

Despite the fact that most policies won’t pay out if people cancel their travel due to coronavirus; in February, Post Office Insurance saw a year on year rise in sales of policies of 168% and CoverForYou saw a 150% increase.

Queries on new policies have sharply spiked up to 60% since fresh cases of Covid19 reports.

“Globally, we have seen such cases that impact large populations there is an increased push from consumers to get themselves covered. We have seen the same happen here as well in the wave of fresh cases being detected” 

Pankaj Verma, head marketing & underwriting operations, SBI General Insurance.

After the epidemics of SARS in 2003, Ebola in 2014 and Zika in 2015 — insurance companies realized that business-interruption claims could become unwise if they covered closures related to outbreaks of disease. Since then, insurers have taken steps to exclude epidemics from their policy.

Though epidemics are excluded from many business insurance policies, as recession threatens the global economy along with rising insolvencies, all sorts of companies, from airlines to retailers are coming under strain.

The insurers refused to comment, but Atradius said it is expected that corporate insolvencies will grow 2.4% globally in 2020, majorly resulting from the coronavirus outbreak.

The harsh reality

Perhaps, it’s too late to buy coverage for the current outbreak. Insurance companies do agree to take the brunt of the situation and pay the decontamination cost after the outbreak, but would tightly limit the amounts.

With unprecedented turmoil the industry created by the outbreak caused global airlines to cancel thousands of flights. Companies could choose a policy that would cover the deaths from an epidemic, when it passed a pre-estimated threshold, or when a government body — anywhere in the world — ordered a lockdown or travel ban. The policies are intended as custom contracts, so the company would choose according to their own risks.

Coface chief executive Xavier Durand mentioned that hotels and airlines will have to take the maximum brunt of the epidemic outbreak, while Euler Hermes saw coronavirus costing $320 billion of trade losses every quarter this year.

This indicates that companies will have to bear the losses themselves. It can be either directly or in the form of self-insurance funds (large companies often set aside some funds for emergencies).

LV, the insurance giant in the UK, have stopped selling travel insurance with immediate effect as a result of the coronavirus outbreak.

“We can’t insure a burning building,” Mr Ryan Christian Ryan of the risk advisory firm Marsh says.

The bottom line

The Coronavirus have adversely impacted the economy worldwide. From time to time, violent demonstrations slowed down the flood of travellers to a trickle and transactions grind to a halt. 

McKinsey anticipates recession until the end of Q2 because of large-scale quarantines, travel restrictions, and social-distancing leading to a sharp fall in consumer and business spending. However, because of banks’ strong capitalization and macroprudential supervision, a full-scale banking crisis is averted.

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MantraTalks Podcast with Richard Roy Mendonce: Covid-19 & the Disruption in Healthcare

11 minutes, 21 seconds read

The outbreak of COVID-19 has put immense pressure on the healthcare sector. The supply chain of medical supplies was hit. The sudden surge of patients made it difficult to manage the hospital operations. Since priority had to be given to COVID patients, regular consults and elective surgeries were delayed. 

To go one step further and understand the disruption in healthcare amidst these adverse conditions, we interviewed Mr. Richard Roy Mendonce, Head Digital Strategy at Yashoda Hospitals to shed light on the role of technology in combating the current challenges faced by healthcare and possible mitigation strategies.

Mr. Richard Roy Mendonce has a strong domain expertise within the Healthcare Industry and has successfully infused digital transformations in various organizations like Columbia Asia Group of Hospitals, Sakra World Hospital, and Manipal Hospitals Group that ensured better customer experience and increased business. 

A Digital Strategist, he currently leads the digital efforts at Yashoda Hospitals, which is among the oldest and biggest healthcare groups in the region. He has nearly a decade of experience in digital marketing, digital strategy and digital transformation, with a distinctive ability to develop highly effective and measurable strategies that drive revenue growth, new customers, brand awareness and reputation. 

Constantly inspired & fascinated by the dynamics of the digital landscape, he has developed a skill set built on the art of leveraging digital technologies focused to deliver positive user experiences and achieve business objectives. In 2019, he was awarded as one of the 50 Most Influential Strategy Leaders by COM Global at World Marketing Congress.

Connect with Mr. Richard Roy Mendonce – LinkedIn

Watch the interview: 

The excerpt from the interview:

Covid-19 & the Disruption in Healthcare

Many hospitals are reassessing their digital marketing strategy and budgets in light of the uncertain economic situation. Most healthcare organizations can benefit from taking this time to strategize and plan for the future, rather than putting the brakes on. Please share some key insights into the changing patient behavior and the steps you are taking to reach them? Also, How will the healthcare marketing landscape change Beyond COVID-19?

Mr. Richard: In terms of healthcare, especially telemedicine, COVID-19 has completely cut down the channel of visiting doctors in-person for a consult. Lack of options has increased more acceptance towards Telemedicine. A couple of months back, we compared the benefits and comfort of direct consultation to an online one. We were reluctant to have those experiences but now acceptance has increased. 

Another thing I feel is —  we do not need high-end technology or equipment. When we hear of telemedicine, what comes first to our mind is jazzy computers, high-tech connections, software, etc.; but that is not the case. Even a simple SMS/call/WhatsApp call is enough to connect with a doctor. We don’t really need any high-end equipment to start a telemedicine service. 

Today, most of the spending is being diverted to digital channels rather than traditional offline ones and it will continue to happen. Digital channels are more trackable, more efficient, and more controllable. Even digital connect to engage with offline channels is gaining momentum. Healthcare set-ups will have offline referral networks, business partners. Traditionally, there would be a sales team who go meet and connect with them. Now with the social distancing and lockdowns, even that connection is replaced with digital connections such as webinars, video calls, etc. 

Communication in marketing has also changed. Before COVID-19, the communication was “Don’t ignore your health, come to us”. During the COVID-19 situation, the communication was “Come to us only if it is an emergency, it’s better to stay at home”. Post COVID-19, the communication might be- “Wherever you are, we are accessible, come to us or use our online services.” 

Telemedicine in a Post-Pandemic India

In the short time since the Pandemic began, the impact of social distancing norms has changed our daily lives & routines. Due to which, services like live remote consultations and telemedicine are getting more attention. Telemedicine is likely a permanent beneficiary of the pandemic. Do you think it will remain a key mode of healthcare delivery even after restrictions are lifted? Are there other digitally-enabled services that can potentially find greater adoption in a Post-Pandemic India?

Mr. Richard: Telemedicine will continue to be one of the modes of care delivery but that will not replace the existing care delivery system. Rather, it will be a mix of both. People will opt for telemedicine for the initial consultation (a non-serious one) and post-treatment follow-ups or review visits or to update on reports. People might get accustomed to telemedicine services but I think that will never replace serious conditions or surgical specialty where doctors need to examine personally to deliver proper care. 

In terms of acceptance level of technology, there has been wider acceptance for non-clinical support systems. For example, chatbots in place to address customer service and AI-driven platforms to check symptoms and guide the patient to respective specialists. This is not for prescriptions, but to enable patients to help themselves in availing services. 

Related: Healthcare Chatbots: Innovative, Efficient, and Low-cost Care

Medical supplies: Another area where digital platforms should have a wider scale of adoption is traveling for non-essential medical supplies. Pharma delivery is one sector that can go entirely digital. We can also have a format where physical stores are eliminated. Delivery can be from warehouse to customer. 

Diagnostics: Apart from radiology, diagnostics can go completely digital. Home care such as remote ICUs, remote monitoring could have potentially greater adoption in the current scenario. 

Disruption in healthcare will also include technologies to strengthen medical education and training.

Operational Challenges in Healthcare

From the operations point of view, digital transformation alone cannot help in preparing for an outbreak of this scale. The reality is we also have to be prepared for the possibility of a next Pandemic wave. The pandemic itself is testing the digital readiness and operational resilience of hospitals, in digitizing services and bringing innovation into healthcare. What are the operational challenges, as far as digital capabilities go, that hospitals are facing currently? And, what steps must they take to bridge these gaps?

Mr. Richard: We all know that the entire system was not geared up for a pandemic of this scale. Hospitals are facing both operational and clinical challenges. However, I’ll address this one particular issue from a digital angle. 

The biggest challenge for any hospital is the lack of a digital care platform and is still heavily dependent on paper-based systems. Now we know that anything can be sanitized but how do we sanitize paper documents. Patients have to carry these documents, touch them, and exchange multiple hands which can be potential carriers of the virus. Now it is more important to keep all the medical records digitized. 

Another aspect is the nature of this virus which is highly communicable and is leading to the community spread of this disease. Therefore, hospitals have a responsibility to maintain data at a patient-level so that contact tracing becomes much more easier and automated. So, maybe a symptom can be added as a trigger in the system and automatically do a contact tracing and give a list of people they can reach out to.

Yet another aspect in healthcare which is prone to change is remote working. Most of the industries such as IT have already geared up for remote working but healthcare has not. Many of the processes still need people coming to the office and working on a computer that is in the network. So, the disruption in healthcare relies on digital platforms to ensure that staff is efficiently deployed.

Changes in the Patient Experience

Both outpatient and in-patient treatment for all major non-communicable diseases including emergencies have declined. Going forward, as the country tries to resume life in the New Normal, industries like retail are experimenting with touchless interfaces to boost the customer’s confidence in shopping in-store. What changes, if any, do you foresee to the physical patient experience?

Mr. Richard: Wherever possible, currently hospitals are trying to minimize contact. Like airports, one can print their boarding pass, even hospitals can ask the patients not to wait in a line at the reception but rather book an appointment and make payments online. Once the appointment is booked, patients can just come and wait for the doctor’s call. We have seen multiple robotic-assisted surgeries where contact with the patient is avoided. Similarly, some technologies may come up taking vitals from the patient in a no-contact manner. There are hospitals in the country that have introduced innovative robots who screen patients coming to the hospitals. There are lots of innovations possible in this area. 

Role of AR, VR and AI in Digital Healthcare 

Huge volumes of data are flowing into the cloud, not just from doctors’ offices and imaging centers, but also from remote devices and sensors worn or operated by patients. By harnessing the vast amounts of data and putting it to work in applications, it helps care providers to improve effectiveness and efficiencies. Do you see technologies like AR/VR/AI playing a role in the future of digital healthcare in India? Can you share some examples of areas that Yashoda Hospitals has begun experimentation or implementation with these technologies?

Mr. Richard: Artificial intelligence, Machine Learning, Augmented Reality, Virtual Reality, Cloud systems, etc. are the buzzwords these days. I do believe that these technologies will pick pace in the healthcare industry as well. But I see a challenge there. Though all the data is on the cloud, the data is held by individual stakeholders and corporations. And standardization of data is the biggest challenge right now. 

So, any company which is working towards utilizing these technologies should first look at technologies that can bring data on one platform which is usable, accessible, and standardized without compromising confidential information of the patient. In terms of innovation at Yashoda hospitals, we are working on a couple of them such as AI-based radiology systems, optimizing customer journeys in hospitals, manpower planning, etc. 

Related: Medical Image Management: DICOM Images Sharing Process

Let’s take the patient discharge process for instance. Transitioning a customer from ‘in-patient’ to ‘out-patient’ is a significant challenge for any hospital, since it involves multiple departments. You’ve even stated before that it takes the integrated view of HIS (hospital information systems), EMR (electronic medical records), inventory, billing, and real-time updates of treatment progress to facilitate discharge at the click of a button. What is your experience in the transformation process and the ground realities of addressing this critical pain point? 

Mr. Richard: Theoretically speaking, the discharge process takes a lot of time but the reason it takes so much time is because it involves multiple stakeholders at a time- internal as well as external. It further gets complicated when the insurance is involved. I think all healthcare providers are looking to simplify the discharge process. The only way it is possible is having technology cut across stakeholders and in real-time. So wherever possible, we can avoid these internal communication delays. 

Return to Normal: The way forward

As hospitals plan for the complicated return stage (once restrictions are lifted), the volume of footfalls, testing, etc. will gradually increase. What advice can you share with other healthcare leaders to prepare their organization on the frontline to manage specific risks regarding employee safety, patient outcomes, etc? What investments (in remote patient monitoring, medical equipment, CRM systems, etc.) should healthcare organizations be making to respond to ‘the return to normal’?

Mr. Richard: I think that the precautionary steps taken by most of the healthcare providers are commendable. It is much better than in other countries across the world. We are in touch with a few of the major chains and the precautions that are being taken are phenomenal. Starting from thermal screens and fever clinics at the entrance, social distancing blogs; we have implemented Cluster Systems within our hospitals. It is a system where the employees are clustered in certain areas to minimize cross-contamination between employees. 

In terms of investment in technology, clinical data can be good to start working on. A good EMR system that seamlessly integrates and exchanges data between all relevant information systems is the need of the time. This investment will not just be in terms of technology but also behavioral change. 

So the system has to be friendly to seamlessly capture the data and make it available across systems. Using data efficiently is important to guide clinical decision support, developing user experience protocols and creating empowerment for the patient. 

Summing up

COVID-19 has changed a lot in us. The lockdown has unlocked a lot of things. It is a good time to innovate. Essential services would be a keyword used for a very long time now in every aspect. Be it shopping, be it food, be it health. And social distancing will be a new lifestyle. 

In this session, Mr. Richard shared insights on the disruption in healthcare and the importance of technological innovations in the new normal for hospitals.


AI is going to be essential for Insurers to gain that competitive edge in the post-pandemic world. Check out Hitee — an industry-pecific chatbot for driving customer engagement. For your specific requirements, please feel free to write to us at hello@mantralabsglobal.com.

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