Fitch Ratings recently revised its outlook for the life insurance industry in Asia-Pacific to negative from stable, attributing the revision to the coronavirus outbreak and the impact on the credit quality of life insurers in the region.
But even before the outbreak, insurers were already busy prepping for the transformation of the industry, including technology-led disruption as well as regulatory reforms.
One regional insurer that has been busy making the change is Great Eastern. Most recently, it announced enhancements to its digital onboarding process.
FutureCIO spoke to Ryan Cheong, managing director, Digital for Business at Great Eastern on where the changes are taking place for the insurer and what’s in store in the months ahead, including when COVID-19 is no longer a threat to people.
When did Great Eastern start looking into digital solutions as part of its customer engagement strategy?
Ryan Cheong: We saw the need to go digital some years back based on how the industry has been evolving. Consumer behaviour and expectations have changed over the years, and we as consumers all have come to expect simple and seamless customer journeys from purchase to payments, servicing to claims.
Technology provides opportunities for greater customer engagement, product innovation and operational transformation. As we focus on Customer First, we have progressively rolled out services on digital platforms since 2018 as part of our digital transformation strategy, led by integrated set of initiatives to equip our financial representatives to deliver better financial advisory and customer experience.
To strengthen the capabilities for our agency channel, we developed the Great Digital Advantage platform in 2019 to help our financial representatives better serve customers in the digital age and enhance their efficiency, productivity and professionalism.
Building digital affinity partnerships is also an integral part of our digital transformation and over the last three years, we have developed partnerships with multiple players such as ActiveSG, Samsung, Singtel and Sembcorp Power to provide insurance solutions to new segments of customers more conveniently and seamlessly.
We’ve also leveraged advanced digital capabilities in data analytics and digital marketing to capture new sales opportunities as well as used data analytics to better position ourselves in the bancassurance market, providing more targeted insurance offerings for bank customers.
What would you describe are the unique approaches that GE took in developing its digital strategy?
Ryan Cheong: Being unique is not as important as being effective in delivering our strategy for what we see as critical shifts in customer behaviour brought in by the rising digital tide. The approaches we have chosen plays on the strengths that we already have and the opportunities that we want to capture.
First, we put our mental model of the business on its head and shifted from a “policy contract” first to “customer portfolio” first. For insurance as a sector, this is a big thing. From there, we have evolved our processes, skillsets and systems to shift to being much more customer centric.
Secondly, we focused on bringing our existing distribution channels into the digital world, as seamlessly as possible, and deliberately not pursue a conflicting digital vs. non-digital approach. This is very important in our industry which is essentially a people business.
We believe, based on the numerous customer studies conducted, that there is an important continuing role for financial representatives in the digital realm for insurance, though the role will change. Rather, our view is that digital technologies and tools can make our distribution channel a lot more effective and empower our field force.
Third – the common understanding that starting with “doing digital” is the means but certainly not the end. In this, building a digital mindset among our people has been pivotal to getting alignment and support all throughout the organisation in our digital transformation journey. Departing from the more traditional way of doing things and looking at things anew, with a digital lens. And as we further extend the ring of involvement of staff, financial representatives, and partners in “doing digital”, we create and drive a new culture of “being digital”.
To date, how have GE agents [channels] and clients responded to these new models for engagement?
Ryan Cheong: Our financial representatives have fully adopted the digital platform which we rolled out. Ours is not a challenge of adoption. Even before the pandemic and social distancing measures, we had already moved the agency force well into the digital way of working. Not just the way that they help their customers with insurance products, but also in the way they engage and provide post-purchase services.
On our Great Digital Advantage platform, they could already access tools such as such as mobile point of sales, the mobile sales activity planner, lead management tools, and we have a chatbot to assist our financial representatives.
We were already on track to launch a digital sales platform to support our financial representatives. Customers can buy online if they do not need financial advice, while being able to enjoy the full suite of post-purchase services from their financial representatives. This has always been in line with our belief in having our agency force “do digital”, or “use digital” to do better.
Our current focus has moved to growing a community of user-advocates amongst our financial representatives. We want to work with them to build on the next iteration of digital services that will differentiate the proposition of being a Great Eastern financial representative, and that will be aligned to their needs of tomorrow.
We hope that they will become our advocates to grow a new breed who go beyond “using digital” to “being digital natives”, so as to create a totally new mindset of being truly digital, and using online capabilities, digital marketing and data analytics to engage, acquire and transact with customers, just like a second skin.
Insurance products themselves have not changed, merely the customer engagement, onboarding, claims processing, and customer communication strategies. Are there plans to eventually transition to a fully digital-only business process even after COVID-19 has been eradicated?
Ryan Cheong: I believe that just because insurance products themselves have not changed significantly in the past; it doesn’t mean that they can’t change in the future.
The next step for us as an insurer is to explore how insurance products can be changed for the better of customers, be strengthened fundamentally.
We are in the business of risk management. There are risks that we traditionally take on in the form of insurance contracts. However, as more of us live a bigger slice of our lives in the digital realm, there may be new risks that could be well managed through insurance contracts, and hence new types of insurance products to cater to those needs.
As a leading insurer, we believe we should always challenge ourselves to look at insurance not as products but insurance as a service. We therefore need to think about how a customer will interact with insurance if it is viewed as a service.
Even more so, can insurance as a service be more anticipatory? Can policies be more dynamically underwritten? Other questions to ask include – can insurance as a service not only provide a claim after the insured event has happened, but to help customers to avoid the risk?
This is the reason why we offer services on our GETGREAT health and wellness platform to help customer live a more active life and better protect against the ailments of sedentary living. We direct the use of digital technology towards supporting our business strategy, not the other way around.
In fact, we can say that our plans have the underlying theme of using digital technology to help us do more of the right things faster, with less complication. Some business processes may become fully digital-only, while others will see our colleagues in the team use digital technology to become much more effective at what they do.
We’ve often heard that digital transformation is a journey. How do you finance/budget a strategy that doesn’t appear to have an end?
Ryan Cheong: On this journey of digital transformation, we have signposts. For each path, projects and programmes, we have clearly defined measures of outcomes. Hence, budgeting for the strategy is not an open-ended matter for us. This is an imputed discipline to make sure resources are properly accounted for.
A good part of the resources used for the ‘digital’ work is already embedded inherently in our regular technology investments. We evaluate each project request and ask ourselves if it would contribute to our digital strategy, or deliver positive impact to the business, and we prioritise based on the impact.
In addition, we keep annual investment amounts to an even keel and some of the value created from digital projects is put back into funding future initiatives.
With uncertainty the only thing we can predict of the future, how does GE plan its next strategy?
Ryan Cheong: Uncertainty is certainly the only certain thing in today’s world, especially for insurance companies like Great Eastern where our very core business lies in the discipline of risk management. We are after all in the business of managing risk or helping our customers translate uncertainty into something they can choose to avoid, accept or transfer.
Stress testing is done very regularly as part of our risk management process. We test different scenarios, including global pandemic scenarios like the current one. Stress testing is very useful to find out the potential kinks in our armour. It helps us to prepare as well as we can for the impact from events like what we are facing now. That is the downside risk.
What about the upside risk? We complement this enterprise risk management process with strategic planning.
Before I came onto this role to lead the digital for business for the Group, I was heading the strategy and transformation function. In the past, we ran the strategic planning cycle like a marching band, playing the tune and marching to the beat of the annual set of activities that is integrated to the budgeting exercise.
Several years back, as we cast our minds into the possible future, it was very clear that we needed something that would allow us to respond much quicker to changes in the environment.
We saw that digital developments would be compressing timelines, quickening the pace of change and shifting customer behaviours at a magnitude unseen before. And realised we really needed something more agile to complement the annual strategic planning cycle.
In the language of the investment team, we needed a wider band for Tactical Asset Allocation, while keeping our eyes on the Strategic Asset Allocation plans. We needed to change strategic planning from a set piece play to frequent and timely strategic conversations that translate to responsive decisions to deal with changes.
On the digital transformation front, our strategy was to leverage the brilliant basics of digital to deliver insurance as an enjoyable and everyday experience for the customer.
Insurance had been a business that was structured around insurance contracts. We were “policy-centric” in many aspects, from data systems, applications, and operational process to the most important aspect – our mental models.
Strategically, we had to put that on its head and change our approach to become truly customer-centric. For example, we need to look at constructing a customer risk portfolio instead of customer product holdings. We are now in a better place to deliver greater value to our customers and in business outcomes.
