At the Techsauce Global Summit, Southeast Asia’s largest tech meeting, we spoke to Nadia Suttikulpanich – head of Fuchsia Innovation Center, Muang Thai Life Assurance (MTL). Nadia together with Danny Yeung from Prenetics gave a talk at the conference ‘Reimagine Life Insurance through HealthTech’. Prenetics is a HealthTech company and has developed in a cooperation with Fuchsia ‘myTHAIDNA’ anutrigenomics product to help consumers understand their specific nutrition needs based on their DNA test results.
1) What is the Fuchsia Innovation Centre’s mission?
Fuchsia was formed in April 2016. The key objective is to create innovation, both tech and non-tech, for the life insurance company that we are working for (MTL). It results from the vision of the CEO to move the incumbent into more consumer-centric services and increase engagement. Another task is to ensure that we inject an innovative culture back into the organisation. The way in which we work is to try and establish cross-functional teams. Most insurance companies have very deep rooted knowledge in each of the functions, but somehow when forming cross-functional teams that might not get translated very well. So what we are trying to do is to form new ways of working to ensure that we draw out all the goodies from each of the functions and make more powerful products and services for our consumers.
2) Is the focus of Fuchsia more on innovation in the frontend or in the backend?
This is a really interesting question. When we first started I thought we needed to change engagement and dialog with consumers because there are a lot of things that insurers are not doing right. It might have been right for the time, but now that the time has passed and moved on, we really need to catch up. So, at the beginning it was more of a frontend piece, but actually when you dig down to it you cannot neglect the backend. Because the backend itself is a huge enabler, no frontend can work without rejigging the backend. So, right now we have to look at both.
3) Are you mainly looking into innovating the current business model or is it more about breakthrough innovation/moonshots?
We look at this in three buckets, almost like 70-20-10. First, the current business is really important and there is a lot of improvement that can be done there. Secondly, the 20% is about coming up with new technologies that have been proven, so things like AI and machine learning. And hopefully that will trigger back to the 70%. Lastly, moonshot is the 10%. We are a Thai company and we really want to keep an eye out and not miss out or get left out. But in terms of current business portfolio and the next level that we need to go to, 70 and 20 is much more important to us. The life insurance penetration in Thailand is really shocking. It’s only 4% in an 80 year old industry. So there is lots of room to really increase that penetration in my opinion. Because if you look at Thailand itself right now, the country cannot grow without the right support system. If you look at life and health insurance, the government cannot sustain the whole support system. So, we need to raise awareness, get people to understand and to take responsibility and to make sure that they are well supported.
4) The Thai market has a strong need for life and health insurance as a result of an aging population and an increase in single households,but penetration is still very low. Do you think technology can solve this?
I think the key thing with the penetration is really understanding. The insurance companies are not really speaking to consumers and it appears such a difficult topic that most people are not able to understand it. But people can understand it if insurers remove jargon. Insurers, even in their advertisements,use insurance language and not consumer language. It makes people feel like there is something hidden. But essentially it is not and you have to break it down. People want to know and want to understand. We know more about the features of our next phone than our life insurance. And that’s wrong. So if the insurance industry can really take that stand and make it simpler for people, I think that is the first step. I truly believe this is the first step in engaging more people. You don’t really need tech, you just need to make sure you are on a digital channel that consumers can search for you, and that they can understand you.
5) What is Fuchsia doing to achieve that?
The latest project that we launched is about going beyond just selling insurance. It’s about really giving the tool to people to be able to take care of themselves. If you look at it from both ways, people don’t want to get sick and insurers also don’t want people to get sick. I care about the people’s health. I care about me. So if there is the right tool for me to have more insights, more data and more information that I can take better care of myself, that’s a great enabler. So we want to engage consumers with that approach and that’s why we have decided to launch the Nutrigenomics DNA product together with the insurance. The insurance company will not see the data, or the consumer profile, but it is actually the first step to new ways in which we can engage and communicate better with our customers.
Another program the company has developed, even before I joined, is a vitality-ish program called the ‘SixPacks’, to create engagement and get consumers to walk more, exercise more and get rewarded for a healthy lifestyle with points. But I think we really need to get beyond that.
6) Fuchsia is also working with startups, how do you select which startups you work with?
Initially the Innovation Center will look at it from a strategic angle by investigating what the startup can help us with in the value chain. There are so many different points in which a startup can help us. So,for example, a new product we are working on, Health at Home, is a service to create a dialog post-sales. Nutrigenomics DNA is more of a customer acquisition tool, as well as kind of an added benefit beyond insurance. We are also working with technology companies for social listening and data mining. So, those are the kinds of areas in which we engage on. We are also quite interested in the area of dynamic underwriting and dynamic pricing. But those concepts may not necessarily come from a startup, because there are a lot of big companies operating in that framework. But we are trying to look at what is the best model to engage on. On the other side we just recently opened up corporate venture capital. So, there is Fuchsia Venture that has just been launched, and here we really focus on InsurTech and HealthTech. And the way we look at the investment is more of a strategic partnership because what we can provide is market access.
7) Measuring success is a problem most innovation centers face. Do you track success using KPIs?
We really have to thank our CEO and the leadership team for giving us this opportunity. There is a mantra and a lot of startups are using this as well, it is ‘fail fast, fail forward, but succeed often’. This is just the beginning of our journey and there are no hard KPIs as of yet. But now that we started launching products out to the market, definitely there will be KPIs such as engagement, sales, talkability and things like that. But different projects will require different KPIs. For me right now, engagement, especially internally, is one of the things that I strive for.
8) Internal engagement is very important. Most insurance companies face resistance to innovation especially from traditional sales channels. What is your opinion on that?
I think it’s a challenge, but I think this is really something that people need to push for. I don’t think that you can erase traditional channels and we are not here to disrupt traditional channel, we are here to provide choice to people. Because, for example, my mum, she will never go online! Actually she is seeing an agent right now as we speak. But for me, for our generation, we prefer to do the study ourselves and we don’t want people to call us. So there will always be segments for both traditional and digital channels. Maybe we first want to search online, but at the point of purchase we maybe also want to talk to a human. So it’s about providing the platform to give a choice to people. It’s not about killing off the old world and creating a new world. It’s about creating choice for consumers. And as we go we have to educate the people to make sure that it is not about machine versus human.
9) Finally, how innovative would you say the Thai insurance market is?
There is appetite for sure, but we need to increase the speed. There needs to be a different engine. Because I think we are in that stage of transitioning, so if we don’t transition fast enough, we might lose momentum. People believe in it now, but if you drag it on you might lose that belief, and if you lose that belief you are essentially denying the consumer progression.