InsurTech focus – Ping An
Insurtech is gradually being implemented within the Chinese insurance industry, overhauling inefficient processes and allowing the development of new and better products that exploit data analytics. But some insurers are looking at how it can transform their distribution channel which is largely still human.
Even those delivering disruption to the traditional insurance market have legacy problems they must deal with.
The agency channel is just one of them (see last month’s Library report)
Improving the human touch
While hailed as an exemplar of digitalisation, this channel has four key weaknesses: too few managers; inefficient recruitment; too few full-time agents; and reliant on inefficient paper-based processes.
Ping An has identified that it has a number of these weaknesses and has developed some digital features to help to address these problems.
Four steps to heaven
It has a four-phase plan to transform its agency channel by moving its focus away from product pushing to a more advisory approach. In order to do this, it has developed a digital strategy in order to train its existing one million agents.
Phases one and two have already delivered considerable gains:
– 310 million sheets of paper per year have been saved;
– underwriting time has been reduced from 5 days to 15 minutes;
– 91% of agent training has been achieved online;
– the training service manpower has been reduced by 70%; and
– productivity has been increased by 32%.
The third phase of development will focus on applying artificial intelligence (AI) to improve the quality of agent recruitment and screening. It will also be used to allocate financial resources more effectively and assist in career planning for the agency force.
By digitising the recruitment and interview process, Ping An anticipates a saving of 1.43 million working hours a year. That already sounds like a huge saving, but it is an eye-watering 60,000 days or 163 years they expect to save every year. In monetary terms, 630 million yuan of financial resources will be saved annually.
Technology is also being used to improve agent knowledge and skills in order to bring through high performance individuals faster than before. The project seeks to slash the time taken to develop high performing agents from 36 months in 208 to just 15 months.
As they develop quicker, so their ranks will grow and Ping An aims to have 459,000 high performing agents by the end of 2019 against the 383,00 it had in 2018.
Benchmarking is used to identify the strengths and weaknesses of each agent to deliver a tailored training plan.
Digital help in the office
An AI Assistant will help with the smart allocation of tasks, and the adjustment of plans. Online and real time connection ensures the content is fully compliant, but will also monitor real time communications, agent behaviour, and assess agent risk. This is to ensure that agents are fully compliant and exposing the company to risk.
Al agents will be backed by a 24 hour online virtual support service that will identify types of business, process and review the data and offer leads, product matching and clear recommendations for agents to pass to clients.
The leads offered through this model has already achieved a 10.8% conversion rate, among 220 million customers through 1.3 billion interactions.
This is expected to drive a RMB 2.8 billion increase in sales revenues while reducing the loss from lapsed premiums by RMB 2 billion.
Losses from fraud are also expected to be reduced by RMB 350 million.