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Contactless Solutions in Insurance

3 minutes, 53 seconds read

Last decade was benchmark for contactless technology, which was mainly confined to payments. In 2014, with the launch of ApplePay followed by Android Pay and Samsung Pay, digital wallets played an important role in raising the bar for digital payment experiences. Another remarkable breakthrough in the contactless payments can be attributed to NFC-only debit cards introduced in 2016 by Erste Group Bank AG.

Now (the 2020s), we’re about to witness another disruption in contactless digital experiences, which will cover many different business spheres including insurance. 

However, prolonged lockdowns and the need for social distancing amidst the COVID crisis has shifted consumer preference towards digital. Consumers are now ready to adopt digital technologies — appreciating the contactless approach by Insurers.

Today’s consumers expect personalization, convenience, and greater levels of customer service satisfaction regardless of insurers, assets, and geography. Soon, we may resume socializing, but there sure will be a change in the way we interact with our environment. 

This article highlights the emerging contactless solutions in Insurance.

Claims Inspection

Going by the traditional physical inspection way, even a simple motor claim may take 5-7 working days. For instance, after a customer has intimated the insurer about the accident, the Insurer would assign a surveyor to assess the extent of damage/loss and authenticate the incident. 

This process is not only time consuming, but also requires the surveyor to visit the location, assess the damage, and process documents. 

Self-service claims portals can help customers register, inspect, and settle their motor insurance claims in a comparatively shorter time. It also eliminates field-visits for the surveyor.

The technology that is creating an impact here is Machine Vision. It can analyze damaged parts and the severity of damage through the photographs submitted by the customers. 

Trillium Mutual Insurance, Bajaj Allianz are already using contactless claims solutions for their policyholders.

[Also read: How Machine Vision can Revolutionize Motor Insurance]

Policy Distribution

Agents have been a predominant channel for insurance distribution for decades. In 2019, the new-age tech-savvy customers posed a threat to traditional agent-based selling in Insurance. The current COVID crisis has confused businesses as to which channel to opt. The elder generation, who preferred face-to-face communication while buying a policy, planning investment, etc. are reluctant to meet people. 

In this situation, multilingual/vernacular chatbots can handle pre and post-sales queries; thus, eliminating the need for agents/RMs to meet clients and prospects physically. 

Chatbots equipped with language processing capability can be a great contactless solution for policy distribution. They can eliminate human interaction in areas such as First Notice of Loss (FNOL) and customer support.

“The new normal is when people learn how to do contactless selling. Covid-19 has brought a change in universal behavior..everybody realizes the need for social distancing, the need to go digital and this is where people are more amenable to being sold to digital. Insurers who accomplish contactless sales today are the ones who will be able to make a difference going forward.”

K V Dipu, President — Operations, Communities & Customer Experience, Bajaj Allianz General Insurance

[Also read: ‘Digital’ Insurance Broker: The case for a digital brokerage]

Another aspect of this case is equipping agents with technical knowledge and they can help clients/prospects on “how to” situations through video chats.

API Integration

In the API-based business model, apart from traditional distribution channels, 3rd party apps allow customers to buy/renew insurance policies. 

Digital wallets like PayTM and PhonePe (in India) have updated their interface to allow essential payments to the fore including insurance premiums. The API-based approach in Insurance is gaining momentum as it allows contactless payments and adds convenience for the user.

[Also read: Four New Consumer-centric Business Models in Insurance]

Contactless Solutions: Field Survey using Drones

Drones carry the ability to extract accurate field information, which can fuel real-time analytics using artificial intelligence and machine learning. MarketsandMarkets estimates the Indian drone software market to reach $12.33 billion by 2022. Drones can fulfill two strategic objectives for Insurers:

  1. Risk management: through efficient field data collection, analysis, and actionable insights 
  2. Operational costs management: through effective claims adjudication, claims processing, and customer experience.

The Future

Gradually, the world will move towards a contactless ecosystem. Most of the processes will be automated and wearables and mobile devices will dominate business-to-customer interactions. 

Automotive business, which totally relied on the dealership and offline sales has adapted itself to operate online amidst this crisis. Companies like BMW, Hyundai, Volvo, and Peugeot have already introduced contactless online sales globally.

The point is — people are giving a thought to buying an expensive asset without physically examining it. Digital channels are giving almost similar experiences as physical channels to both consumers and businesses.

In the Insurance landscape, people are open to buying policies online, and at the same time, Insurers are ready to rely on technology for claims investigation, underwriting, and fraud detection. 

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Open Finance: Reality or Hype?

3 minutes read

Open Banking has reshaped the fintech industry. Customers want a seamless experience with more convenient and flexible access to services. Technological innovation and digital transformation have led to the emergence of neobanks which offer a banking experience similar to delivery apps. Now the customers can avail of services like opening an account in minutes. In the last few years, another new concept- Open Finance has joined the queue. What exactly is open finance? Is it just hype or reality? And how open finance might improve customer experience (CX). These are some of the questions that we’re going to talk about in this blog. 

Open Banking

In open banking, banks and other financial institutions allow third-party financial service providers to access the bank’s customers’ data via APIs (application programming interfaces). This helps banks to create more personalized offerings and meet the changing needs of their customers.

What is Open Finance?

Open Banking and Open Finance are similar. However, Open Finance is slightly more advanced in the process. Simply put, it is the next step in open banking. 

Open Finance is a more customer-centric approach. It gives users a safe and dependable way to share their data with the financial tools and apps they prefer to use.

How is Open Finance different from Open Banking?

How is Open Finance different from Open Banking?

Source: Accenture

Open Banking has certain limitations when it comes to sharing of financial data. Here, only that data can be shared which is related to financial operations made within the bank’s app or in a branch office. Open finance goes beyond this limitation.

In Open Finance, non-banking financial data including mortgages, savings, pensions, insurance, and consumer credit – basically your entire financial footprint – could be opened up to trusted third-party APIs if you agree.

Open finance will help open new gateways for financial institutions to improve CX. Let’s dig deeper to understand how this concept will change CX in the Fintech world for the next-Gen customers. 

  1. 360-degree Customer Insights: Data acts as a tool to study deeply about your customers. Organizations can analyze the customer data and extract some valuable insights to design the complete customer journey. Open Finance opens a more secure pathway for financial institutions and gives a more complete picture of their customer’s finances. 
  2. Partnerships & Collaborations: With open finance, comes an opportunity for the financial institutions to network and collaborate with various providers. This means they could deliver a wider variety of services based on consumer data, uncovering new business models and innovations.
  3. Transparency for the Lenders: Lenders can evaluate and measure the creditworthiness of potential borrowers, audit documents, and offer customized solutions by securely collecting customer data. Machine learning algorithms may help to extract valuable insights from raw data.

Open Finance offers freedom and flexibility to consumers giving more options and control over the data they share and how they engage with their finances. With just 8 seconds of attention span, the new age consumers want better experiences to get hooked to one brand. Open finance creates unparalleled access to a broader range of products and services. With data sharing, banking organizations can keep track on the changing customer expectations who want frictionless interactions and hyper-personalized experiences across all touchpoints of the customer journey.

The Road Ahead

Statista predicts that there will be 63.8 million open banking users globally by 2024, increasing at an average annual rate of about 50% between 2020 and 2024. This means there will be more demand for innovative products and services in the industry. Banking organizations would need to analyze the rising customer expectations more closely than ever. And for this, data would act as a key to designing the experience of tomorrow. 

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