Thought Leadership

Singapore is riding the crest of a wave of digital implementation across financial and government services.

The government has made a commitment to the pursuit of a cashless economy and aims to be cheque-free by 2025.

E-payments have been well received and their adoption is growing exponentially. The government has followed up with improved consumer protection around electronic payments to prevent any horror stories setting back this step change in transactional behaviour.

It’s not just cash that benefits

A beneficiary of digital transformation is, of course, the insurance sector, where insurtech is beginning to make a breakthrough.

One such example has been the development of robotic process automation (RPA) and artificial intelligence (AI) at Etiqa in Singapore.

In 2018, Etiqa launched a chatbot, called Trix, to increase customer self-service levels and provide a more consistent service. The chatbots were designed to improve customer experience by reducing the time that customers must spend interacting with automated call centre systems. It also supports customers who find automated systems and difficult or who lack the IT skills to navigate a website. By listening to customers’ requirements, there is less time hanging on the telephone or filling in complicated forms.

More than just chatbots

Trix was introduced across online purchase and customer service. But it is no conventional chatbot. This is no conventional chatbot as it requires no typing. Instead, the customer talks to the system to get the support they require. It can also be integrated directly into Etiqa customers’ homes.

“We wanted to improve our service and integrated our website and Facebook pages with Google Assistant, so customers can simply say ‘Hi Google, I want to talk to Etiqa insurance’ and they will be connected to our system,” says Dennis Liu, head, business transformation and technology at Etiqa.

Etiqa was the first in the industry to deliver such a service. While some insurers are integrating their systems with Amazon’s Alexa, Etiqa opted for Google, because no installation is required by the customer – they need only speak to their smartphone app or Google Home device.

More than 3,000 home insurance customers have signed up for Etiqa’s Google Home integrated product. The equipment is free if they purchase five years plan and customers can always use the traditional web-based interface if they prefer.

Phase one targeting general and product queries. Phase two will integrate the chatbot with customer service portals to pull up policy information and submit claims.

The commercial benefits are apparent

Through this transformation, Etiqa is looking to improve efficiency, customer experience and also direct the client online. The use of the chatbot has not reduced call centre traffic. If anything, calls, emails and even physical visits to customer care centres have increased, perhaps because the contact has been made so much easier than before.

The immediate goals were to improve customer experience because Etiqa believed it would result in increased sales levels. ‘Build it and they will come’ is a business approach that has caused many to come unstuck in the past, but on this occasion, Etiqa was absolutely on the money.

When Etiqa launched the Trix service in flight delay and auto-claim last year, there was an immediate spike in traffic. The Facebook page was inundated with comments from customers amazed by the service and there was an almost overnight 50% increase on sales.

Innovation is the key to success

Etiqa’s digital proposition has been the foundation of its success in the past few years. It targeted strong growth in online sales and from 2016 onwards, saw its business there grow by more than 300% year-over-year.

“This was not due to slick advertising campaigns or marketing,” says Liu, “but through using our innovation to drive traffic.”

In a period of six months, Etiqa has already experienced more than 3,000 Google Home adoptions on the basis of customers’ improved experience. They now see the insurance company very differently from others they have used in the past.

This is a key component of success for those seeking to become a digital-first organisation. Satisfied customers become brand advocates for the service, which is far more powerful than traditional marketing strategies in attracting new customers.

Revolution, not evolution

This digital transformation is having its own influence over the transformation of the company. Etiqa’s 180,000 plus unique online customers generate a lot of data, allowing the company to develop this channel to offer more tailored products that are also based on behavioural observations.

“We believe we are offering the best product for our customers,” says Liu. “This will only improve as we use the data to build new products that meet their needs.”

Freelance income protection is one such innovation that has captured considerable media attention and with good reason. Singapore has around 230,000 freelance workers – a little under 5% of the population. Work can be patchy and Etiqa’s product allows these individuals to buy a policy by the week, month or year.

Life, but not as we know it

Perhaps the greatest advancement is in the application of this technology to the life market. Etiqa has launched an online universal life product that taps directly into an innovation championed by the Monetary Authority of Singapore (MAS) to simplify and speed up the underwriting process of life policies.

“Life products come with a lot of documentation,” says Liu. “Like everywhere else, we have KYC (know your customer) regulations to adhere to and some of these processes can take weeks or even months.”

Being a “very forward-thinking” regulator, MAS has developed MyInfo, a single online portal that allows individual citizens to share their personal data across government agencies (see box at the end) and now, certain commercial entities.

Etiqa is the first financial institution to have integrated with this service that allows customers to buy a life policy in one transaction and without having to complete the forms themselves.

“Because all the information is certified, our systems can make instant decisions on underwriting and approval, slashing the time it takes from weeks and months down to mere minutes,” says Liu.

Etiqa isn’t the only company to see the opportunities presented by MyInfo, but others are having to deal with legacy IT issues. These IT problems mean product launch can take a firm six months, whereas Etiqa can launch a product within a month, says Liu.

Endless opportunities

AI and other new insurtech will have a major impact on the whole insurance industry in the very near future, says Liu. Insurtech is gaining traction and the industry is beginning to catch up with the digital revolution.

Though the introduction of the chatbots has increased traffic and interaction with customer service processes, this has achieved high levels of customer engagement – the holy grail for insurers.

The technology is already saving money elsewhere, with AI and RPA reducing the need for manual operation jobs by around one half.

A bright future

Etiqa’s simplified approach is generating sales and data to create new products that target the specific requirements of its customers.

The integration with MyInfo removes the largest obstacle to the purchase of life products – inertia – because the customer knows the process has always been so painful in the past.

A focus on smart devices has simplified access, removing the need for any customer, whatever their age or technological ability, to interact with their insurance company.

Users may provide access to their data by giving consent through their MyInfo account. They can also view how it has been used in the past.