Technology- A key driver for the insurance sector
CXOToday interacted with Vishal Shah, Head – Data Science, Digit Insurance to understand the evolving role of technology in various aspects of the Indian insurance sector
- How is technology transforming India’s Insurance ecosystem?
The insurance industry in India has been transformed by the technological revolution, with the emergence of new-age insurance companies and Insure-Techs offering tech-enabled solutions such as AI-based models, IoT, and Big Data. AI’s Natural Language Understanding (NLU) is a unique feature that enables insurers to navigate diverse sources of data, evaluate potential risks, and process claims faster. The integration of AI and modern analytics has enabled insurers to offer self-servicing features and tailor-made products and services, resulting in accurate risk assessments and the appropriate calculation of premiums. Telematics is another technology that has significantly impacted the auto insurance sector. It provides a digital blueprint of a vehicle’s operation, enabling insurers to analyze the risk profile of a driver, customize policies with appropriate pricing models, and investigate claims with real-time data analysis. The efficiency of these technological advancements has positively impacted the new-age insurance ecosystem in India.
In conclusion, adopting the latest technology has enabled the insurance industry in India to gain a competitive edge, enhance its capacity to counsel clients, handle claims faster, and offer new services. The industry is likely to see greater adoption of telematics and wearable devices, further revolutionizing the industry in the coming years.
- How can technology and digitization help with the expansion of insurance in tier 2 and 3 cities in India?
Technology and digitization can play a critical role in expanding insurance in India’s tier 2 and 3 cities. Smartphone and internet penetration have increased significantly in recent years, providing a significant opportunity for insurers to reach these uninsured sections of the country.
According to the recent Red Seer report, India is expected to surpass 1 billion internet users by 2030 due to the accelerated growth and adoption of the internet and technology. By leveraging this growing digital infrastructure, insurance companies can provide easy access to insurance products through mobile apps and websites. This approach can potentially reach a large number of people in tier 2 and 3 cities who may not have access to physical insurance branches. The ease of access can help promote financial inclusion and increase insurance penetration in these areas.
Technological advancements can also help create awareness about insurance products. By leveraging digital channels, insurers can help tier 2 and tier 3 markets understand the need for insurance and the kinds of products available. This can also help increase the demand for insurance in these markets. Additionally, using technology and digitization helps make the insurance process more efficient. For example, the use of digital platforms for underwriting, claims processing, and customer service can reduce operational costs, enabling insurers to offer insurance products at an affordable price to people in tier 2 and 3 cities.
- How does Digit use artificial intelligence & machine learning capabilities to improve efficiency?
Digit’s core strength lies in technology, which has enabled the company to grow rapidly since its inception in 2017. We have successfully bridged the gap between data, insights, and practical solutions by leveraging big data for business intelligence and analytics. This approach has not only improved cost management but has also increased efficiency. To consistently enhance our processes, we have adopted a hybrid approach that integrates AI, analytics, and human evaluation.
One example of our innovative use of technology is the creation of “smartphone-enabled inspections” using AI and ML for immediate automobile insurance pre-inspection. This solution has significantly reduced the turnaround time from a few days to just 5 – 10 minutes, eliminating the need for physical surveyor examination and streamlining the process. Additionally, we have developed a system that employs image analytics, AI, and ML to detect fraud.
Another example of our technological solutions is an integrated API system on the cloud that automatically notifies clients with travel insurance of their right to claim if their flight is delayed for more than 90 minutes. To better meet the needs of its partner ecosystem, we have also developed technological solutions for them. The reception of tech-integrated solutions has been outstanding, allowing us to quickly gain an edge over other players.