Article Synopsis :
Ping An is the biggest insurance company in China with 184 million retail customers and 538 million registered internet users.
Its operating profit grew by 19% in 2018 and 63 million customers bought more than one product from its subsidiary companies – more than a third than the previous year.
Despite its huge size, it behaves more like a startup. It is constantly using its understanding of its customers to provide them with the products they want.
More than a fifth (29,000) of its employees are in research, developing the next big thing from facial expression detection software, speech synthesis, etc.
Its not afraid to take its own medicine, either. Last year, it applied artificial intelligence to a screening model for more than 11 million potential agents. So effective was this project, its success at identifying those who would remain with the company for more than a year was greater than 95%. That’s some hit rate.
It also operates as an incubator, developing Lufax, a wealth management platform, Ping An Good Doctor, the telemedicine doctor with more than 250 million users and Autohome, an online car sales portal.
Ping An believes insurers need to go big or go home. It claims Lufax and Good Doctor are the largest of their kind in the world, while Autohome has captured more than a third (40%) of the Chinese market.
It has also developed a disease model covering more than 40 diseases and 20 have been adopted at hospitals. They have read more than 15 million images and delivered an accuracy rate for diagnosis above 90%.
What this case study by Infosys is trying to say, is that Ping An has become so large because it is very good at doing what it does. It stretches itself far beyond core services in order to identify as many possible ways of finding a touch point with consumers and interact with them. This is not only its raison d’être but the central plank of its business model.
The future is potential disintermediation
If other entities – the giants like Amazon and Alibaba – get to know more about the customer, they will be disintermediated and can anticipate a future of decline.
Ping An is developing these different ecosystems in order to be able to compete with these potential disruptors.
It has an advantage in understanding its client base so well. This is the only reason a company would have developed bovine facial recognition in order to ease the claims process for rural Chinese farmers.
High tech, high stakes
High bandwidth 5G systems will lead to exponential growth of data from the internet of things. However, some of that data will be about monitoring and maintenance which can be used to direct maintenance to the machines that need it most, or switch off the gas when a consumer goes away to save the building being burned down.
Ping An has embraced the notion of making itself indispensable to its client base. That is a powerful position to be in, but difficult to maintain as it requires constant innovation and engagement with consumers.
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Digital Insurer's CommentsThose who think that moving their traditional insurance business online is going to transform their business into a future-proofed, competitive and ultimately, profitable – organism will be sorely disappointed.
The subtext of this case study is that if insurers need to be convinced of a model, they should be looking at Ping An.
And if they can’t emulate the company, they should be looking to partner with it.
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