With change redefining life insurance in 2.0.2.2., the industry will emerge bigger and stronger. In my opinion, life insurance revolves around securing the certainties of life, rather than preparing for the uncertainties. When viewed through the lens of convictions, the perspectives on future are sharpened by the narratives that define the industry.

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Every industry, every company has taken a refresher to deal with the abstract. They must now shape it into opportunities that encourage growth in 2022. Each year is defined by the new ideas it brings.

As a professional with over two decades (and counting) in the insurance industry, here are my top pick of trends that will add value to our industry.

Let’s Be Friends, Let’s Consolidate!

Consolidation is critical to survival. 2021 saw mergers and consolidations, which will continue in 2022 with increased fervour. Small players will find it difficult to sustain due to intense competition, increased operating costs, redundant processes, and most importantly due to inadequate distribution. Big players will get bigger and small players will cease to be relevant in absence of captive distribution. Taking stock of your company’s strengths, weeding out non-performing assets, and forging complementing alliances is the way forward.

Companies that don’t invest in expanding their distribution channels, both horizontally and vertically, will find it extremely hard to survive. To hedge risks, companies will vertically expand by deepening captive distribution. Horizontally, companies will look at category expansion by focussing on complementing distribution channels, for example – Bancassurance and credit life; employee benefits, group term life and worksite marketing, etc..

The Age of Bespoke Product Innovations

A direct impact of the pandemic has been the surge in sales of pure protection plans. Online sales of term life insurance has increased substantially. The surge has been supported by focused efforts of both, the insurance industry via campaigns, such as 'Sabse Pehle Life Insurance' and by the government via social security schemes. This surge presents an opportunity. The most successful firms will be those that re-evaluate their strategies and create innovative products that align with customer needs and desires, across market segments.

Futuristic variants of protection plans, such as Switch on – Switch off insurance, Sachet or Bite sized insurance, and Customized insurance, could open the door to many possibilities. I’d like to emphasize here that all innovations will be the result of careful analysis of what consumers seek and what regulators allow. After all, it’s the customers’ peace of mind that we strive to achieve.

Tech Takeover to Amplify Process Excellence

The pandemic presented organisations with an opportunity to reimagine customer journeys and rethink processes. It got everyone to get cracking digitally. If anything, Technology will only accelerate itself in 2022 to fuel business growth. Technological automations will take over the banal. Human interventions will focus on adding remarkable value to customer interactions. Automating a task using IoT (Internet of Things), Artificial Intelligence (AI), and Machine Learning (ML) models, will reduce errors and enhance Customer Experience (CX). This will lead to robust process excellence, which will have a positive effect on a company’s cost and time efficiencies.

Let’s look at instant issuance of insurance policies. In this hyper-connected world, a customer’s digital footprint is available online, with Banks, and with government repositories such as UIDAI. Wearables often provide insights into the health and lifestyle habits of a customer.

Using IoT and AI, the requisite data can be auto populated in the insurance policy form. Further, ML models can smartly scrutinise and verify documents. Using data analytics, fraud prediction models, and AI algorithms for automated underwriting; insurers can navigate the ocean of data, gauge risk and come up with a personalised quote for adequate cover. This end-to-end automation of procedures will lead to saving of cost and time for both insurers and customers, while facilitating instant issuance of an insurance policy through process excellence.

From onboarding to servicing and settling, the future presents immense possibilities.

The Segment of One

Customer Experience (CX) has progressed beyond the buying journey and conflict resolution. To be ahead of the curve, we must foresee customer needs and behaviour, and treat personalisation as an essential. With tech-aided active ‘listening posts’, customer feedback can be captured, synchronised, analysed, and then acted upon with precision to offer hyper-personalised products and services.

Instead of a one-size-fits-all model, insurance is aggressively evolving to accommodate complex customer needs.

2022 will see insurers aiming to trim the segment down to one individual – the “Segment of One”. A proprietary database and an engineered approach would decode the information to deliver a customised offering. Sounds too sci-fi? And yet, I would bet my money on this one. The closer an organisation gets to the segment of one, the closer it gets to success

Foresight and cutting-edge technology will only be effective with the right talent. An organisation’s biggest asset is its people. Tech can create magic but when paired with the right people, it can work miracles. Nothing can beat the power of the human mind. The future belongs to those who embrace a digital mindset while staying tethered to traditional values. The formula for success is an empowered and enriched team that looks beyond the obvious. That to me, is the timeless trend.

The author, Rushabh Gandhi, is Deputy CEO at IndiaFirst Life Insurance. The views expressed are personal

(Edited by : Anshul)

First Published:Jan 4, 2022 10:13 AM IST