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18th Annual Insurance Conference
FINCON 2017‘The Changing Face of Indian Insurance’
Conference Proceedings
INDEXProgramme Inaugural Session
Session IThe New Shareholders
Session IIInsurance in a Bionic World
Session IIIDisrup�ve Force of InsurTech
Session IVScaling New Technology Fron�ers
4 6
15
29
22
38
INDEXProgramme Inaugural Session
Session IThe New Shareholders
Session IIInsurance in a Bionic World
Session IIIDisrup�ve Force of InsurTech
Session IVScaling New Technology Fron�ers
4 6
15
29
22
38
FINCON 2017: Conference Proceedings 4 FINCON 2017: Conference Proceedings 5
#FINCON 2017
Program10:00 am - 11:15 am Inaugural Session
Welcome Address by Mr. Rashesh Shah, Senior Vice President, FICCI and Chairman and Chief Execu�ve Officer, Edelweiss Group
Theme Address by Mr. Amitabh Chaudhry, Chairman, FICCI Commi�ee on Insurance and Pensions and Managing Director and Chief Execu�ve Officer, HDFC Standard Life Insurance Co Ltd
Release of FICCI- BCG Knowledge Paper
Presenta�on on 'The Changing Face of Indian Insurance - Bigger, Be�er, Faster' by Mr. Alpesh Shah, Senior Partner and Managing Director, The Boston Consul�ng Group
Special Address by Mr. V K Sharma, Chairman, Life Insurance Corpora�on of India
Inaugural Address by Mr. T S Vijayan, Chairman, Insurance Regulatory and Development Authority of India (IRDAI)
Concluding Remarks by Mr. G Srinivasan, Co-chairman , FICCI Commi�ee on Insurance & Pensions and Chairman cum Managing Director , The New India Assurance Co Ltd
Session moderated by Ms. Jyo� Vij, Deputy Secretary General , FICCI
11:15 am - 11:30 am Tea/Coffee break
11:30 am - 12:45 pm Session I - The New Shareholders
Session moderated by Mr. Alpesh Shah, Senior Partner and Managing Director, The Boston Consul�ng Group
Panelists
l Ms. Alice G Vaidyan, Chairman cum Managing Director, General Insurance Corpora�on of India
l Mr. Rajesh Sud, Vice Chairman and Managing Director, Max Life Insurance Co Ltd
l Mr. G Srinivasan, Co-chairman , FICCI Commi�ee on Insurance & Pensions and Chairman cum Managing Director ,The New India Assurance Co Ltd
l Mr. Neelesh Garg, Managing Director and Chief Execu�ve Officer, Tata AIG General Insurance Co Ltd
l Mr. Sakate Khaitan, Senior Partner, Khaitan Legal Associates
Q&A
12:45 pm to 01:45 pm Networking Lunch
01:45 pm - 02:45 pm Session II - Insurance in a Bionic World
Session moderated by Mr. Pranay Mehrotra, Partner and Director, The Boston Consul�ng Group
Panelists
l Mr. K Sanath Kumar, Chairman cum Managing Director, Na�onal Insurance Co Ltd
l Mr. Vighnesh Shahane, Chief Execu�ve Officer & Whole Time - Director, IDBI Federal Life Insurance Co Ltd
l Mr. Munish Sharda, Managing Director and Chief Execu�ve Officer, Future Generali India Life Insurance Co Ltd
l Mr. Sa�sh Pillai, Managing Director and Chief Execu�ve Officer, TransUnion CIBIL
l Mr. K G Krishnamoorthy Rao, Managing Director and Chief Execu�ve Officer, Future Generali India Insurance Co Ltd
Q&A
02:45 pm - 03:45 pm Session III - Disrup�ve Force of InsurTech
Session moderated by Mr. Amit Kumar, Partner and Director, The Boston Consul�ng Group
Presenta�on / Product Demonstra�on by 3 InsurTech Companies (02:45 pm - 03.00 pm) followed by Panel Discussion
Panelists
l Ms. R M Vishakha, Managing Director and Chief Execu�ve Officer, India First Life Insurance Co Ltd
l Mr. Mayank Bathwal, Chief Execu�ve Officer, Aditya Birla Health Insurance Co Ltd
l Mr. Ja�n Singh, Chief Execu�ve Officer, Skymet Weather Services Pvt Ltd
l Mr. Milan Sharma, Chief Execu�ve Officer , Intello Labs
l Ms. Meena Ganesh, Managing Director and Chief Execu�ve Officer, Portea Medical
Q&A
03:45 pm - 04:45 pm Session IV - Scaling New Technology Fron�ers
Session moderated by Mr. Yashraj Erande, Partner and Director, The Boston Consul�ng Group
Panelists
l Mr. Tapan Singhel, Managing Director and CEO, Bajaj Allianz General Insurance Co Ltd
l Mr. Rakesh Jain, Chief Execu�ve Officer, Reliance General Insurance Co Ltd
l Mr. Vikas Agnihotri, Industry Director, Google India
l Mr. Sagar Apte, Founder and Chief Execu�ve Officer, CarIQ
l Mr. Shridhar Marri, Chief Execu�ve Officer and Co-Founder, Senseforth Technologies
Q&A
18th Annual Insurance Conference
'The Changing Face of Indian Insurance - India Insurance 2020’
March 9, 2017, Mumbai
FINCON 2017: Conference Proceedings 4 FINCON 2017: Conference Proceedings 5
#FINCON 2017
Program10:00 am - 11:15 am Inaugural Session
Welcome Address by Mr. Rashesh Shah, Senior Vice President, FICCI and Chairman and Chief Execu�ve Officer, Edelweiss Group
Theme Address by Mr. Amitabh Chaudhry, Chairman, FICCI Commi�ee on Insurance and Pensions and Managing Director and Chief Execu�ve Officer, HDFC Standard Life Insurance Co Ltd
Release of FICCI- BCG Knowledge Paper
Presenta�on on 'The Changing Face of Indian Insurance - Bigger, Be�er, Faster' by Mr. Alpesh Shah, Senior Partner and Managing Director, The Boston Consul�ng Group
Special Address by Mr. V K Sharma, Chairman, Life Insurance Corpora�on of India
Inaugural Address by Mr. T S Vijayan, Chairman, Insurance Regulatory and Development Authority of India (IRDAI)
Concluding Remarks by Mr. G Srinivasan, Co-chairman , FICCI Commi�ee on Insurance & Pensions and Chairman cum Managing Director , The New India Assurance Co Ltd
Session moderated by Ms. Jyo� Vij, Deputy Secretary General , FICCI
11:15 am - 11:30 am Tea/Coffee break
11:30 am - 12:45 pm Session I - The New Shareholders
Session moderated by Mr. Alpesh Shah, Senior Partner and Managing Director, The Boston Consul�ng Group
Panelists
l Ms. Alice G Vaidyan, Chairman cum Managing Director, General Insurance Corpora�on of India
l Mr. Rajesh Sud, Vice Chairman and Managing Director, Max Life Insurance Co Ltd
l Mr. G Srinivasan, Co-chairman , FICCI Commi�ee on Insurance & Pensions and Chairman cum Managing Director ,The New India Assurance Co Ltd
l Mr. Neelesh Garg, Managing Director and Chief Execu�ve Officer, Tata AIG General Insurance Co Ltd
l Mr. Sakate Khaitan, Senior Partner, Khaitan Legal Associates
Q&A
12:45 pm to 01:45 pm Networking Lunch
01:45 pm - 02:45 pm Session II - Insurance in a Bionic World
Session moderated by Mr. Pranay Mehrotra, Partner and Director, The Boston Consul�ng Group
Panelists
l Mr. K Sanath Kumar, Chairman cum Managing Director, Na�onal Insurance Co Ltd
l Mr. Vighnesh Shahane, Chief Execu�ve Officer & Whole Time - Director, IDBI Federal Life Insurance Co Ltd
l Mr. Munish Sharda, Managing Director and Chief Execu�ve Officer, Future Generali India Life Insurance Co Ltd
l Mr. Sa�sh Pillai, Managing Director and Chief Execu�ve Officer, TransUnion CIBIL
l Mr. K G Krishnamoorthy Rao, Managing Director and Chief Execu�ve Officer, Future Generali India Insurance Co Ltd
Q&A
02:45 pm - 03:45 pm Session III - Disrup�ve Force of InsurTech
Session moderated by Mr. Amit Kumar, Partner and Director, The Boston Consul�ng Group
Presenta�on / Product Demonstra�on by 3 InsurTech Companies (02:45 pm - 03.00 pm) followed by Panel Discussion
Panelists
l Ms. R M Vishakha, Managing Director and Chief Execu�ve Officer, India First Life Insurance Co Ltd
l Mr. Mayank Bathwal, Chief Execu�ve Officer, Aditya Birla Health Insurance Co Ltd
l Mr. Ja�n Singh, Chief Execu�ve Officer, Skymet Weather Services Pvt Ltd
l Mr. Milan Sharma, Chief Execu�ve Officer , Intello Labs
l Ms. Meena Ganesh, Managing Director and Chief Execu�ve Officer, Portea Medical
Q&A
03:45 pm - 04:45 pm Session IV - Scaling New Technology Fron�ers
Session moderated by Mr. Yashraj Erande, Partner and Director, The Boston Consul�ng Group
Panelists
l Mr. Tapan Singhel, Managing Director and CEO, Bajaj Allianz General Insurance Co Ltd
l Mr. Rakesh Jain, Chief Execu�ve Officer, Reliance General Insurance Co Ltd
l Mr. Vikas Agnihotri, Industry Director, Google India
l Mr. Sagar Apte, Founder and Chief Execu�ve Officer, CarIQ
l Mr. Shridhar Marri, Chief Execu�ve Officer and Co-Founder, Senseforth Technologies
Q&A
18th Annual Insurance Conference
'The Changing Face of Indian Insurance - India Insurance 2020’
March 9, 2017, Mumbai
Inaugural Session
Welcome Address: Mr Rashesh Shah, Senior Vice
President, FICCI and Chairman and Chief
Execu�ve Officer, Edelweiss Group.
Mr Shah began by lauding the energy and
enthusiasm of the par�cipants who were eagerly
awai�ng the presenta�ons by the country's
leading insurance luminaries. He thanked Mr
Vijayan and appreciated his encouragement and
support that have been cri�cal for the industry.
Mr Shah went on to observe that the insurance
industry in India is at a fairly cri�cal point. It has
come a long way over the last 14-15 years. The
reach of the industry through the solu�ons and
benefits it offers to its stakeholders is simply
amazing, he felt. He likened the industry to an
elephant, where everybody experiences a
different part of the elephant: it helps individual
customers mi�gate risks and offers them financial
stability through long-term investments; and it
helps the economy as a whole by offering long-
term capital for infrastructure and capital
forma�on. Indica�ons are that the industry is
coming of age, and the growth ahead will surpass
most expecta�ons.
"As we look at this, one of the more important
issues in front of us is the use of technology and
how it transformed the industry," he said. Over
the next eight or ten years, all aspects of financial
services will be impacted, largely posi�vely, by
the role technology will play, he felt. Earlier, this
was an industry about people. As the industry
grew, it became an industry about the quality of
people and capital. Most recently, it has become
an industry about people, capital and technology.
With advancement in technology, the industry is
changing very rapidly. Along with technology,
issues like climate change have an impact on the
industry, especially general and health insurance.
FINCON 2017: Conference Proceedings 6
Another key change that the industry is seeing is
the consolida�on of the financial services sector.
Large mergers and acquisi�ons are taking place;
several government-owned insurance companies
will be listed in the market this year; and bond
markets, in which the insurance industry is
p lay ing a b ig ro le , are growing. These
developments are driving greater awareness
amongst analysts. Mr Shah observed, "I see this
akin to what happened with the banking industry
about 20 years ago." He explained that when
government-owned banks started ge�ng listed in
the market around that �me, it had a huge impact
on the banking industry and brought in large
stakeholder returns. "I think we are at the
inflec�on point of a very similar theme in the
insurance industry."
One of the key challenges faced by the insurance
industry is the high intermedia�on cost.
"Intermedia�on cost should be able to serve the
bo�om of the pyramid," said Mr Shah, referring
to the large un-served and under-served market.
In short, insurance needs to be converted from a
push to a pull product. Addressing the large
number of students present, Mr Shah hoped that
they would see insurance as an a�rac�ve career
op�on over the next 20-30 years. He explained
that insurance being a truly long-term industry, it
is a good avenue to convert savings into
investments because that calls for long-term
thinking. Finally, he pointed out that as the
economy evolves, interest rates will no longer be
constant and stable; this will impact how the
insurance industry evolves, and how products
and solu�ons will need to be created.
Theme Address: Mr Amitabh Chaudhry ,
Chairman, FICCI Commi�ee on Insurance and
Pensions and Managing Director and Chief
Execu�ve Officer, HDFC Standard Life Insurance
Co. Ltd.
Mr Chaudhry informed the house that this year's
conference theme built from that of last year,
where digital trends, opera�onal excellence and
next genera�on products were discussed. With
today's rapidly changing world that is in a state of
con�nuous flux, it is necessary to project what the
future could look like. "It is very important we use
a crystal ball to see what could poten�ally
happen in the markets in the future and how the
insurance industry should be prepared to
capitalise on some of those changes," he said. He
observed that the industry is opera�ng in some
very interes�ng �mes: the global economy is
under pressure due to various geopoli�cal factors
like the US elec�ons, Brexit, the Greece debt crisis
and the refugee crisis, to name a few; but in the
midst of this, India is emerging as the fastest
growing major economy in the world. The
performance of the insurance industry over the
last few years reflects the long-term economic
growth prospects that the country has. The scope
is huge, given that insurance is under-penetrated
and 70% of the market is not adequately covered.
Mr Chaudhry pointed out that new age customers
will form a very important part of the insurance
market. "While we con�nue to cater to the
tradi�onal l ife insurance customers, the
increasing base of Gen X and Gen Y consumers
whose saving needs outweigh the demands of
protec�on cannot be ignored." This segment of
the popula�on, he felt, does not understand or
feel the need for insurance products; the industry
FINCON 2017: Conference Proceedings 7
Inaugural Session
Welcome Address: Mr Rashesh Shah, Senior Vice
President, FICCI and Chairman and Chief
Execu�ve Officer, Edelweiss Group.
Mr Shah began by lauding the energy and
enthusiasm of the par�cipants who were eagerly
awai�ng the presenta�ons by the country's
leading insurance luminaries. He thanked Mr
Vijayan and appreciated his encouragement and
support that have been cri�cal for the industry.
Mr Shah went on to observe that the insurance
industry in India is at a fairly cri�cal point. It has
come a long way over the last 14-15 years. The
reach of the industry through the solu�ons and
benefits it offers to its stakeholders is simply
amazing, he felt. He likened the industry to an
elephant, where everybody experiences a
different part of the elephant: it helps individual
customers mi�gate risks and offers them financial
stability through long-term investments; and it
helps the economy as a whole by offering long-
term capital for infrastructure and capital
forma�on. Indica�ons are that the industry is
coming of age, and the growth ahead will surpass
most expecta�ons.
"As we look at this, one of the more important
issues in front of us is the use of technology and
how it transformed the industry," he said. Over
the next eight or ten years, all aspects of financial
services will be impacted, largely posi�vely, by
the role technology will play, he felt. Earlier, this
was an industry about people. As the industry
grew, it became an industry about the quality of
people and capital. Most recently, it has become
an industry about people, capital and technology.
With advancement in technology, the industry is
changing very rapidly. Along with technology,
issues like climate change have an impact on the
industry, especially general and health insurance.
FINCON 2017: Conference Proceedings 6
Another key change that the industry is seeing is
the consolida�on of the financial services sector.
Large mergers and acquisi�ons are taking place;
several government-owned insurance companies
will be listed in the market this year; and bond
markets, in which the insurance industry is
p lay ing a b ig ro le , are growing. These
developments are driving greater awareness
amongst analysts. Mr Shah observed, "I see this
akin to what happened with the banking industry
about 20 years ago." He explained that when
government-owned banks started ge�ng listed in
the market around that �me, it had a huge impact
on the banking industry and brought in large
stakeholder returns. "I think we are at the
inflec�on point of a very similar theme in the
insurance industry."
One of the key challenges faced by the insurance
industry is the high intermedia�on cost.
"Intermedia�on cost should be able to serve the
bo�om of the pyramid," said Mr Shah, referring
to the large un-served and under-served market.
In short, insurance needs to be converted from a
push to a pull product. Addressing the large
number of students present, Mr Shah hoped that
they would see insurance as an a�rac�ve career
op�on over the next 20-30 years. He explained
that insurance being a truly long-term industry, it
is a good avenue to convert savings into
investments because that calls for long-term
thinking. Finally, he pointed out that as the
economy evolves, interest rates will no longer be
constant and stable; this will impact how the
insurance industry evolves, and how products
and solu�ons will need to be created.
Theme Address: Mr Amitabh Chaudhry ,
Chairman, FICCI Commi�ee on Insurance and
Pensions and Managing Director and Chief
Execu�ve Officer, HDFC Standard Life Insurance
Co. Ltd.
Mr Chaudhry informed the house that this year's
conference theme built from that of last year,
where digital trends, opera�onal excellence and
next genera�on products were discussed. With
today's rapidly changing world that is in a state of
con�nuous flux, it is necessary to project what the
future could look like. "It is very important we use
a crystal ball to see what could poten�ally
happen in the markets in the future and how the
insurance industry should be prepared to
capitalise on some of those changes," he said. He
observed that the industry is opera�ng in some
very interes�ng �mes: the global economy is
under pressure due to various geopoli�cal factors
like the US elec�ons, Brexit, the Greece debt crisis
and the refugee crisis, to name a few; but in the
midst of this, India is emerging as the fastest
growing major economy in the world. The
performance of the insurance industry over the
last few years reflects the long-term economic
growth prospects that the country has. The scope
is huge, given that insurance is under-penetrated
and 70% of the market is not adequately covered.
Mr Chaudhry pointed out that new age customers
will form a very important part of the insurance
market. "While we con�nue to cater to the
tradi�onal l ife insurance customers, the
increasing base of Gen X and Gen Y consumers
whose saving needs outweigh the demands of
protec�on cannot be ignored." This segment of
the popula�on, he felt, does not understand or
feel the need for insurance products; the industry
FINCON 2017: Conference Proceedings 7
must reach out to them. Their interac�on with the
financial services industry is different from that of
their predecessors. They have access to mobile
phones, and "companies cannot ignore the role of
mobile technology and mobility solu�ons."
Mobility solu�ons will be the key to simplifying
the customer journey. They will also enable the
industry to reach out to the 70% customers who
have not yet been reached. Machine learning
technologies will create avenues for intelligent
and predic�ve learning; fear of fraud will be
minimised by biometric iden�fica�on; big data
analy�cs will have an important role to play as the
Internet of Things, ar�ficial intelligence and
chatbot technologies gain trac�on in the fin-tech
space.
Mr Chaudhry observed that "the digital push by
the Government post demone�sa�on is expected
to induct more and more people into the formal
banking system." Digital India, he felt, will focus
on three key components: crea�on of digital
infrastructure; delivering services digitally; and
increasing digital literacy. This is the third big
change happening from the Indian perspec�ve,
and it is supported by tools like the India Stack.
India Stack is a pla�orm that will help every
company reach its customers in a novel and cost-
effec�ve manner.
"Insurance as it is done today may not exist in the
next decade," suggested Mr Chaudhry, poin�ng
out that evolu�on of digital technology will lead
to changing business models, ubiquitous
connec�vity, and e-migra�on. "Digital and
technology evolu�on is one of the biggest mega-
trends in the world, and India is also going to get
impacted." Globally, the fin-tech space in the
insurance industry is a�rac�ng the maximum
amount of investment, because investors believe
that it will create the maximum displacement of
the original insurance model. "If we don't move in
line with the trend we could face bigger problems
in the future," he warned. Companies will soon
become more and more dependent on their
insurtech divisions, forging new rela�onships.
Indian insurance is now looked upon as a sunrise
sector for investors. The market capital of listed
insurance in India has the poten�al to rise to
almost 22 billion dollars over the next couple of
years. More and more lis�ngs, as well as mergers
and acquisi�ons can be expected as the industry
matures. Investor educa�on and standardised
metrics will be needed to evaluate companies'
performance.
All this will also call for a conducive regulatory
environment that will offer strong protec�on to
minority shareholders. Already a dra� circular has
been issued, which men�ons shareholder
advocacy. But, Mr Chaudhry cau�oned, the
adop�on of these changes should not become an
end in itself. They should be "the means to
achieve the core objec�ve which is to take
insurance to all the people who need it." The end
product needs to be simple. And the winners will
be those who can crack the code of complex back-
end algorithms to create a simple and convenient
experience for the users.
Release of FICCI-BCG Knowledge Paper: 'The
Changing Face of Indian Insurance — Bigger,
Be�er, Faster'.
Mr T S Vijayan, Chairman, Insurance Regulatory
and Development Authority of India (IRDAI),
released the Knowledge Paper developed jointly
by FICCI and its knowledge partner, Boston
Consul�ng Group. The paper focuses on the
impact of all digital-related trends. The global
insurance industry is being challenged by these
trends to rethink its ways of working. Insurers are
being forced to adapt, and become leaner and
FINCON 2017: Conference Proceedings 8
more efficient. Big data and digital are causing
disrup�on and transforming all industry sectors.
The paper examines how insurers need to adapt
to the changes to get bigger, be�er and faster.
Presenta�on on 'The Changing Face of Indian
Insurance—Bigger, Be�er, Faster' by Mr Alpesh
Shah, Senior Partner and Managing Director, The
Boston Consul�ng Group.
Mr Alpesh Shah's focus was on the customer,
rather than the industry. He looked at the
changing face of insurance from the customer's
point of view. He painted a futuris�c picture of the
experience of a hypothe�cal customer called Ajay
Kumar in Lucknow.
The hypothe�cal Ajay Kumar is 40 years old, has a
nice house, and two children. At 7.15 am he
leaves home for his game of squash. As he drives
his car out, he gets an alert informing him that his
car insurance has shi�ed from the home insurer
to the auto insurer. This seems sensible, because
when the car is parked at home it is the
responsibility of the home insurer, and the auto
insurer comes into the picture when the car gets
into mobility. As he gains speed, he gets a warning
that he is accelera�ng too fast and may get a
higher risk ra�ng that may increase his premium.
On returning home Ajay Kumar checks his app
and views his en�re por�olio. Si�ng at his
breakfast table, he reviews his insurance, his
payment, his reward points, his offers, and any
other support that he may need. And as he is
doing this he gets a popup informing him about a
pension plan suitable for his needs, with a video
link to his RM. He gets onto the chat and finds the
product interes�ng. And then he gets another
alert informing him that he has been a safe driver
over the last month and has earned 5000 bonus
points that can be redeemed at any partner
network. But he will not get similar benefits on
the health side because he has not been regular
with his games of squash or his usage of the gym.
As the audience absorbed this in awe, Mr Alpesh
Shah assured them that this is not mere science
fic�on, it is bound to happen. "It's not about what
we sell to the customer, it's about what the
customer sees." This is where the world is headed
and the industry too will have to strive towards
this. It is an end-to-end customer journey, and he
highlighted five points in the story that reflect the
future trajectory of the industry:
(i) So far it has been insurance for a car or an
individual. But when the car is parked in the
garage, it has nothing to do with motor
insurance. Anything going wrong, like
incidents of the� or fire at home, should be
covered by home insurance.
(ii) Customers want preven�on, they don't
necessarily want protec�on. The insurer
should actually be able to help them
prevent accidents.
(iii) Products are customised based on the
specific needs of the customer.
(iv) Already, the interac�ons today are moving
away from the physical world. They are
'phygital', a combina�on of the physical and
the digital world, moving steadily towards
more and more digital.
(v) Insurance will now be about partnerships.
Individual companies can no longer operate
by themselves.
This hypothe�cal case highlights the first of four
major trends that the industry is facing:
(I) It shows how the industry is being impacted
by the entry of digital.
(ii) Regula�ons will need to adapt to the new
developments.
FINCON 2017: Conference Proceedings 9
must reach out to them. Their interac�on with the
financial services industry is different from that of
their predecessors. They have access to mobile
phones, and "companies cannot ignore the role of
mobile technology and mobility solu�ons."
Mobility solu�ons will be the key to simplifying
the customer journey. They will also enable the
industry to reach out to the 70% customers who
have not yet been reached. Machine learning
technologies will create avenues for intelligent
and predic�ve learning; fear of fraud will be
minimised by biometric iden�fica�on; big data
analy�cs will have an important role to play as the
Internet of Things, ar�ficial intelligence and
chatbot technologies gain trac�on in the fin-tech
space.
Mr Chaudhry observed that "the digital push by
the Government post demone�sa�on is expected
to induct more and more people into the formal
banking system." Digital India, he felt, will focus
on three key components: crea�on of digital
infrastructure; delivering services digitally; and
increasing digital literacy. This is the third big
change happening from the Indian perspec�ve,
and it is supported by tools like the India Stack.
India Stack is a pla�orm that will help every
company reach its customers in a novel and cost-
effec�ve manner.
"Insurance as it is done today may not exist in the
next decade," suggested Mr Chaudhry, poin�ng
out that evolu�on of digital technology will lead
to changing business models, ubiquitous
connec�vity, and e-migra�on. "Digital and
technology evolu�on is one of the biggest mega-
trends in the world, and India is also going to get
impacted." Globally, the fin-tech space in the
insurance industry is a�rac�ng the maximum
amount of investment, because investors believe
that it will create the maximum displacement of
the original insurance model. "If we don't move in
line with the trend we could face bigger problems
in the future," he warned. Companies will soon
become more and more dependent on their
insurtech divisions, forging new rela�onships.
Indian insurance is now looked upon as a sunrise
sector for investors. The market capital of listed
insurance in India has the poten�al to rise to
almost 22 billion dollars over the next couple of
years. More and more lis�ngs, as well as mergers
and acquisi�ons can be expected as the industry
matures. Investor educa�on and standardised
metrics will be needed to evaluate companies'
performance.
All this will also call for a conducive regulatory
environment that will offer strong protec�on to
minority shareholders. Already a dra� circular has
been issued, which men�ons shareholder
advocacy. But, Mr Chaudhry cau�oned, the
adop�on of these changes should not become an
end in itself. They should be "the means to
achieve the core objec�ve which is to take
insurance to all the people who need it." The end
product needs to be simple. And the winners will
be those who can crack the code of complex back-
end algorithms to create a simple and convenient
experience for the users.
Release of FICCI-BCG Knowledge Paper: 'The
Changing Face of Indian Insurance — Bigger,
Be�er, Faster'.
Mr T S Vijayan, Chairman, Insurance Regulatory
and Development Authority of India (IRDAI),
released the Knowledge Paper developed jointly
by FICCI and its knowledge partner, Boston
Consul�ng Group. The paper focuses on the
impact of all digital-related trends. The global
insurance industry is being challenged by these
trends to rethink its ways of working. Insurers are
being forced to adapt, and become leaner and
FINCON 2017: Conference Proceedings 8
more efficient. Big data and digital are causing
disrup�on and transforming all industry sectors.
The paper examines how insurers need to adapt
to the changes to get bigger, be�er and faster.
Presenta�on on 'The Changing Face of Indian
Insurance—Bigger, Be�er, Faster' by Mr Alpesh
Shah, Senior Partner and Managing Director, The
Boston Consul�ng Group.
Mr Alpesh Shah's focus was on the customer,
rather than the industry. He looked at the
changing face of insurance from the customer's
point of view. He painted a futuris�c picture of the
experience of a hypothe�cal customer called Ajay
Kumar in Lucknow.
The hypothe�cal Ajay Kumar is 40 years old, has a
nice house, and two children. At 7.15 am he
leaves home for his game of squash. As he drives
his car out, he gets an alert informing him that his
car insurance has shi�ed from the home insurer
to the auto insurer. This seems sensible, because
when the car is parked at home it is the
responsibility of the home insurer, and the auto
insurer comes into the picture when the car gets
into mobility. As he gains speed, he gets a warning
that he is accelera�ng too fast and may get a
higher risk ra�ng that may increase his premium.
On returning home Ajay Kumar checks his app
and views his en�re por�olio. Si�ng at his
breakfast table, he reviews his insurance, his
payment, his reward points, his offers, and any
other support that he may need. And as he is
doing this he gets a popup informing him about a
pension plan suitable for his needs, with a video
link to his RM. He gets onto the chat and finds the
product interes�ng. And then he gets another
alert informing him that he has been a safe driver
over the last month and has earned 5000 bonus
points that can be redeemed at any partner
network. But he will not get similar benefits on
the health side because he has not been regular
with his games of squash or his usage of the gym.
As the audience absorbed this in awe, Mr Alpesh
Shah assured them that this is not mere science
fic�on, it is bound to happen. "It's not about what
we sell to the customer, it's about what the
customer sees." This is where the world is headed
and the industry too will have to strive towards
this. It is an end-to-end customer journey, and he
highlighted five points in the story that reflect the
future trajectory of the industry:
(i) So far it has been insurance for a car or an
individual. But when the car is parked in the
garage, it has nothing to do with motor
insurance. Anything going wrong, like
incidents of the� or fire at home, should be
covered by home insurance.
(ii) Customers want preven�on, they don't
necessarily want protec�on. The insurer
should actually be able to help them
prevent accidents.
(iii) Products are customised based on the
specific needs of the customer.
(iv) Already, the interac�ons today are moving
away from the physical world. They are
'phygital', a combina�on of the physical and
the digital world, moving steadily towards
more and more digital.
(v) Insurance will now be about partnerships.
Individual companies can no longer operate
by themselves.
This hypothe�cal case highlights the first of four
major trends that the industry is facing:
(I) It shows how the industry is being impacted
by the entry of digital.
(ii) Regula�ons will need to adapt to the new
developments.
FINCON 2017: Conference Proceedings 9
(iii) A push towards customer-centricity. The
industry must recognise that while the
intermediary is also a customer, the true
customer is the end customer.
(iv) Insurance will also be impacted by shi�s in
the economy, the environment and
demographic changes. The state of the
economy will affect interest rates; climate
change will have a bearing on the weather
that in turn will affect other industries; and a
lesser known fact is that by 2030 India will
have 350 million people over 50 years of
age—almost the en�re popula�on of
Europe.
These four trends put in perspec�ve the extent of
the course altera�on that the insurance industry
will undergo in the coming years.
And since this conference would be focusing on
digital, Mr Alpesh Shah made a daring and
provoca�ve predic�on that "the insure-tech
invasion is coming". He explained that 34 billion
dollars were invested in insurtechs over the last
ten years, most of it in the last three to five years.
This will transform the way insurance is done.
"Either they will partner with insurance or they
will compete with insurance." On a reassuring
note, he con�nued that the opportunity lies with
us, since India is ready to go completely digital.
BCG does a survey of about 25000 customers
every year to understand their digital buying
behaviour. Mr Alpesh Shah presented insurance-
specific data from urban India from 2013 to 2016.
The following salient points emerged from the
survey:
l Fi�y one per cent of the people who bought
insurance already had access to the
Internet. The data indicated a rising trend,
so in another two or three years, seventy to
eighty per cent of customers would have
access to the Internet.
l Twenty three out of a hundred customers
were already doing one of ten insurance
ac�vi�es online. Six out of those were
actually buying life, health or motor
insurance online. This is an accelera�ng
trend.
In this context, insurers need to see how they
move away from a product-centric to a customer-
centric world; from protec�on to preven�on;
from products to solu�ons; and from limited to
mul�ple touch points.
The FICCI-BCG Knowledge Paper iden�fies a 12-
point agenda for the industry:
(i) The phygital distribu�on of the future. A lot
of change is expected to happen in agency.
The agents will need to be enabled with
more technology. Insurers must work with
banks to leverage the digital pla�orm.
(ii) Serving the underserved as well as the un-
served. Opportuni�es exist in Tier 3 and 4
ci�es, as well as in rural and mass markets.
(iii) Working in partnerships to leverage other
companies' infrastructure and access to
customers.
(iv) Changing the customer experience and the
journey by simplifying procedures.
(v) Engaging be�er with customers.
(vi) Offering simple as well as customised
products, along with differen�al pricing.
(vii) Leveraging the power of big data and
analy�cs.
(viii) Engaging with insurtechs to create the
technology pla�orm.
FINCON 2017: Conference Proceedings 10
(ix) Adap�ng to the needs of the millennial
genera�on.
(x) Masking the complexity to deliver a
seamless experience to the customer.
(xi) Working around changing regula�ons.
(xii) Catering to the needs of shareholders.
Mr Alpesh Shah ended by challenging the
audience with a ques�on: "Is insurance a business
enabled by technology, or will this be a
technology business that also sells insurance?"
He confessed that he had a biased view and was in
favour of the la�er. Insurers should be ready to
make a bold move in order to succeed in the
future. And that is the challenge that the
insurance industry faces.
Special Address: Mr V K Sharma, Chairman, Life
Insurance Corpora�on of India.
Mr Sharma began by declaring that this is the year
of insurance. "We are growing this year by a
reasonably good speed, and I am sure that we will
be ending it with flying colours this year as the
insurance industry," he stated, amidst loud claps.
He expressed pride in the way the life and general
insurance industries in the country had evolved
over the last 15 years. Changes in regulatory
reforms and advances in technology have
influenced the development of the sector and
heightened customer expecta�ons.
India is a young country set to reap the
demographic dividend; the economy is on the
growth trajectory, with increasing infrastructure
investments and rising mobility; the speed of
financial access and inclusion has picked up in
recent �mes. These factors offer immense
poten�al for the expansion of the insurance
sector in India. However, "the future success of
the insurance sector would depend upon a few
cri�cal factors l ike visibil ity," cau�oned
Mr Sharma. So far, he explained, life insurance has
been a push product. More visibility will be able to
give it the same profile as mutual funds or
banking. Awareness should be built so that
insurance is seen as a necessary ingredient of life.
Mr Sharma strongly felt that "nobody should die
un-insured," and it is the duty of the insurance
sector to ensure this. In his opinion, the millions
of Indian ci�zens who die un-insured are a loss to
the country. There are wide gaps in protec�on
cover and re�rement benefits. In par�cular, self-
employed individuals are totally un-insured, with
no pension and no delivery mechanism to them.
With his extensive experience across India, he
iden�fied three main reasons why people opt for
insurance: (i) actual or perceived life insurance
security, (ii) security of money, and (iii) the
percep�on that insurance company will outlive
the policy holder. These are the requirements of
customers.
Recent government ini�a�ves have helped in
financial inclusion. In par�cular, the Pradhan
Mantri Jan Dhan Yojana (PMJDY) has been the
most visible and successful scheme to achieve
this objec�ve. People have availed of these
benefits, and today there is greater awareness in
the country about accident or life insurance
security. Mr Sharma lauded the stupendous
success of the Government in crea�ng such
awareness.
FINCON 2017: Conference Proceedings 11
(iii) A push towards customer-centricity. The
industry must recognise that while the
intermediary is also a customer, the true
customer is the end customer.
(iv) Insurance will also be impacted by shi�s in
the economy, the environment and
demographic changes. The state of the
economy will affect interest rates; climate
change will have a bearing on the weather
that in turn will affect other industries; and a
lesser known fact is that by 2030 India will
have 350 million people over 50 years of
age—almost the en�re popula�on of
Europe.
These four trends put in perspec�ve the extent of
the course altera�on that the insurance industry
will undergo in the coming years.
And since this conference would be focusing on
digital, Mr Alpesh Shah made a daring and
provoca�ve predic�on that "the insure-tech
invasion is coming". He explained that 34 billion
dollars were invested in insurtechs over the last
ten years, most of it in the last three to five years.
This will transform the way insurance is done.
"Either they will partner with insurance or they
will compete with insurance." On a reassuring
note, he con�nued that the opportunity lies with
us, since India is ready to go completely digital.
BCG does a survey of about 25000 customers
every year to understand their digital buying
behaviour. Mr Alpesh Shah presented insurance-
specific data from urban India from 2013 to 2016.
The following salient points emerged from the
survey:
l Fi�y one per cent of the people who bought
insurance already had access to the
Internet. The data indicated a rising trend,
so in another two or three years, seventy to
eighty per cent of customers would have
access to the Internet.
l Twenty three out of a hundred customers
were already doing one of ten insurance
ac�vi�es online. Six out of those were
actually buying life, health or motor
insurance online. This is an accelera�ng
trend.
In this context, insurers need to see how they
move away from a product-centric to a customer-
centric world; from protec�on to preven�on;
from products to solu�ons; and from limited to
mul�ple touch points.
The FICCI-BCG Knowledge Paper iden�fies a 12-
point agenda for the industry:
(i) The phygital distribu�on of the future. A lot
of change is expected to happen in agency.
The agents will need to be enabled with
more technology. Insurers must work with
banks to leverage the digital pla�orm.
(ii) Serving the underserved as well as the un-
served. Opportuni�es exist in Tier 3 and 4
ci�es, as well as in rural and mass markets.
(iii) Working in partnerships to leverage other
companies' infrastructure and access to
customers.
(iv) Changing the customer experience and the
journey by simplifying procedures.
(v) Engaging be�er with customers.
(vi) Offering simple as well as customised
products, along with differen�al pricing.
(vii) Leveraging the power of big data and
analy�cs.
(viii) Engaging with insurtechs to create the
technology pla�orm.
FINCON 2017: Conference Proceedings 10
(ix) Adap�ng to the needs of the millennial
genera�on.
(x) Masking the complexity to deliver a
seamless experience to the customer.
(xi) Working around changing regula�ons.
(xii) Catering to the needs of shareholders.
Mr Alpesh Shah ended by challenging the
audience with a ques�on: "Is insurance a business
enabled by technology, or will this be a
technology business that also sells insurance?"
He confessed that he had a biased view and was in
favour of the la�er. Insurers should be ready to
make a bold move in order to succeed in the
future. And that is the challenge that the
insurance industry faces.
Special Address: Mr V K Sharma, Chairman, Life
Insurance Corpora�on of India.
Mr Sharma began by declaring that this is the year
of insurance. "We are growing this year by a
reasonably good speed, and I am sure that we will
be ending it with flying colours this year as the
insurance industry," he stated, amidst loud claps.
He expressed pride in the way the life and general
insurance industries in the country had evolved
over the last 15 years. Changes in regulatory
reforms and advances in technology have
influenced the development of the sector and
heightened customer expecta�ons.
India is a young country set to reap the
demographic dividend; the economy is on the
growth trajectory, with increasing infrastructure
investments and rising mobility; the speed of
financial access and inclusion has picked up in
recent �mes. These factors offer immense
poten�al for the expansion of the insurance
sector in India. However, "the future success of
the insurance sector would depend upon a few
cri�cal factors l ike visibil ity," cau�oned
Mr Sharma. So far, he explained, life insurance has
been a push product. More visibility will be able to
give it the same profile as mutual funds or
banking. Awareness should be built so that
insurance is seen as a necessary ingredient of life.
Mr Sharma strongly felt that "nobody should die
un-insured," and it is the duty of the insurance
sector to ensure this. In his opinion, the millions
of Indian ci�zens who die un-insured are a loss to
the country. There are wide gaps in protec�on
cover and re�rement benefits. In par�cular, self-
employed individuals are totally un-insured, with
no pension and no delivery mechanism to them.
With his extensive experience across India, he
iden�fied three main reasons why people opt for
insurance: (i) actual or perceived life insurance
security, (ii) security of money, and (iii) the
percep�on that insurance company will outlive
the policy holder. These are the requirements of
customers.
Recent government ini�a�ves have helped in
financial inclusion. In par�cular, the Pradhan
Mantri Jan Dhan Yojana (PMJDY) has been the
most visible and successful scheme to achieve
this objec�ve. People have availed of these
benefits, and today there is greater awareness in
the country about accident or life insurance
security. Mr Sharma lauded the stupendous
success of the Government in crea�ng such
awareness.
FINCON 2017: Conference Proceedings 11
Insurers need to respond posi�vely to the
ongoing changes in the structure of the economy.
This is the age of "hyper-compe��on in the
financial services space." To be successful in such
a situa�on, insurers will need to embrace a
diversified distribu�on system, use their capital
wisely and improve the quality of their products
and services.
Technology will play an important role in this
endeavour. Data analy�cs can arm the insurance
sector with the tools needed to provide insights
into customer behaviour and needs and
surveillance of market trends. Grievances will
need to be redressed in a �mely manner. Aadhar
will be a major vehicle for delivery of services.
Companies that model their products and
services to ride on this vehicle will be the ones
that succeed to the last mile and reach the deep
rural areas where they are not able to penetrate
at present.
Mr Sharma pointed out that the life insurance
market in India is different from that in other
countries. In India, it has developed as a security-
cum-savings product. The rela�onship amongst
all the stakeholders—customers, distributors and
companies—is uniquely symbio�c. The life
insurance ecosystem therefore achieved even
more depth than the banking industry. The role of
this structure cannot be undermined when
planning for future coverage and purchase, which
will be largely technology-driven. It should be
considered as a strength, and technology should
factor in this aspect when designing new
solu�ons. If this can be done successfully, the
insurance industry will be able to cover the 70%
popula�on segment that is yet to be insured.
Inaugural Address: Mr T S Vijayan, Chairman,
Insurance Regulatory and Development
Authority of India (IRDAI).
"Friends, look at the beau�ful way the insurance
sector has developed, especially a�er opening
up." On this posi�ve note, Mr Vijayan informed
the gathering that insurance premiums have
shown 17% CAGR this year. Health insurance has
posted over 32% CAGR. "Which other industry
has got 17% CAGR in India? You can pat yourself,
as an industry we are doing well."
Mr Vijayan pointed out that the growth of the
insurance industry is slightly above the growth
rate of the Indian economy. And it can be
improved in the coming years due to the innova-
�ons that industry is witnessing. Technology is
changing the business environment.
He simplified the concept of insurance. It is
pooling of some amount called a premium, and
paying out against a claim. The concept is simple
but sophis�cated. But the big challenge is
whether this simple concept can move with the
changes in technology. He illustrated his point
with the example of the transporta�on business.
In the past, goods were transported by bullock
cart or headload carriers. Today also goods are
transported, but we use trucks and planes.
Technology has changed, and the transporta�on
business exists because it has kept pace with
those changes. The same idea must be applied to
insurance. It must keep pace with the business
environment. "If the insurance industry can keep
pace with the changes, yes we can also grow very
FINCON 2017: Conference Proceedings 12
well." He sounded op�mis�c that a�er five years
the CAGR could even reach 35%. The market
poten�al is there, with 70% of people un-insured.
"People are there, looking for insurance." That is
why, felt Mr Vijayan, that more and more insur-
ance companies are coming up. With the amend-
ments in the Insurance Act in 2015, foreign
reinsurance companies are allowed to open their
branches here. Shortly, over nine branches of
foreign reinsurers will be opera�ng in India.
"These people would not have come if there was
no poten�al here."
And that poten�al is supported by insurtech.
Compe��on will increase, and not all will
succeed. Those who can u�lise these develop-
ments in the right way will have a great opportu-
nity. Companies must adapt to the changes in
order to grow. Communica�on is becoming easier
with the advent of 4G technology. Insurance
companies must seize this opportunity to reach
out and communicate with their customers.
The Government is assis�ng the growth of the
insurance sector with its various ini�a�ves.
Pla�orms such as Digital India, Make in India,
'JAM' (Jan Dhan, Aadhar and Mobile) and
schemes such as Bima Suraksha Yojana, all give a
big push to the industry. The key for survival is to
tag on to these ini�a�ves. "Whoever is going to
ride that wave is going to be a winner," he
predicted.
The rise of digital also drives the thought process
of the regulator, disclosed Mr Vijayan. Digital
pla�orms such as e-KYC, insurance repositories,
e-commerce and e-policies can be harnessed
posi�vely and are being examined to see if sales
and renewals can be made easier. A central KYC
registry and dematerialisa�on of insurance
policies are also being mooted. He hoped that
insurance gets centralised once GST comes into
force. Other legisla�ve changes are on the anvil,
and the industry should see these changes as
opportuni�es and tag on to them.
Industry must not be shy of innova�on. Product
innova�ons must accompany the changes in the
business ecosystem. Not all of them will be
successful. There may be failures, but "we should
be ready to pay for the failure." O�en, felt Mr
Vijayan, industry barons resist bringing in new
products, ci�ng regulatory restric�ons. He
disclosed that he is open to changing regula�ons
if the industry and the people are benefi�ed.
"Regula�ons are not something wri�en in stone,"
he declared. "You bring the product, let us see."
Technology may even enable the industry to half
its management expenses. "The biggest
challenge in insurance is not on the first sale," he
pointed out. The challenge is in renewal.
Somebody has to follow up with the policy holder.
Constant innova�on can create customised
products that con�nue to remain a�rac�ve.
Digital can help in this, and renewal can be built
into the process. The ini�al enthusiasm of the
customer should be retained through con�nuous
communica�on, and lowering communica�on
costs is essen�al.
With 23 crore policies and 20 lakh agents in the
system, a huge amount of data is available.
Analy�cs can help in ascertaining the chances
that a policy will be renewed, or whether the
agent will con�nue with the customer. The great
challenge before the industry is to use analy�cs to
understand and find an answer to the business
problems. Manpower is very important for the
insurance industry. Training must be provided for
the agents to be able to con�nue and re-sell
policies and engage with the end users.
On a lighter note, Mr Vijayan ended by observing
that FICCI has provided a forum for insurers to
discuss about these developments, and possibly
some companies may base their ac�on plans on
FINCON 2017: Conference Proceedings 13
Insurers need to respond posi�vely to the
ongoing changes in the structure of the economy.
This is the age of "hyper-compe��on in the
financial services space." To be successful in such
a situa�on, insurers will need to embrace a
diversified distribu�on system, use their capital
wisely and improve the quality of their products
and services.
Technology will play an important role in this
endeavour. Data analy�cs can arm the insurance
sector with the tools needed to provide insights
into customer behaviour and needs and
surveillance of market trends. Grievances will
need to be redressed in a �mely manner. Aadhar
will be a major vehicle for delivery of services.
Companies that model their products and
services to ride on this vehicle will be the ones
that succeed to the last mile and reach the deep
rural areas where they are not able to penetrate
at present.
Mr Sharma pointed out that the life insurance
market in India is different from that in other
countries. In India, it has developed as a security-
cum-savings product. The rela�onship amongst
all the stakeholders—customers, distributors and
companies—is uniquely symbio�c. The life
insurance ecosystem therefore achieved even
more depth than the banking industry. The role of
this structure cannot be undermined when
planning for future coverage and purchase, which
will be largely technology-driven. It should be
considered as a strength, and technology should
factor in this aspect when designing new
solu�ons. If this can be done successfully, the
insurance industry will be able to cover the 70%
popula�on segment that is yet to be insured.
Inaugural Address: Mr T S Vijayan, Chairman,
Insurance Regulatory and Development
Authority of India (IRDAI).
"Friends, look at the beau�ful way the insurance
sector has developed, especially a�er opening
up." On this posi�ve note, Mr Vijayan informed
the gathering that insurance premiums have
shown 17% CAGR this year. Health insurance has
posted over 32% CAGR. "Which other industry
has got 17% CAGR in India? You can pat yourself,
as an industry we are doing well."
Mr Vijayan pointed out that the growth of the
insurance industry is slightly above the growth
rate of the Indian economy. And it can be
improved in the coming years due to the innova-
�ons that industry is witnessing. Technology is
changing the business environment.
He simplified the concept of insurance. It is
pooling of some amount called a premium, and
paying out against a claim. The concept is simple
but sophis�cated. But the big challenge is
whether this simple concept can move with the
changes in technology. He illustrated his point
with the example of the transporta�on business.
In the past, goods were transported by bullock
cart or headload carriers. Today also goods are
transported, but we use trucks and planes.
Technology has changed, and the transporta�on
business exists because it has kept pace with
those changes. The same idea must be applied to
insurance. It must keep pace with the business
environment. "If the insurance industry can keep
pace with the changes, yes we can also grow very
FINCON 2017: Conference Proceedings 12
well." He sounded op�mis�c that a�er five years
the CAGR could even reach 35%. The market
poten�al is there, with 70% of people un-insured.
"People are there, looking for insurance." That is
why, felt Mr Vijayan, that more and more insur-
ance companies are coming up. With the amend-
ments in the Insurance Act in 2015, foreign
reinsurance companies are allowed to open their
branches here. Shortly, over nine branches of
foreign reinsurers will be opera�ng in India.
"These people would not have come if there was
no poten�al here."
And that poten�al is supported by insurtech.
Compe��on will increase, and not all will
succeed. Those who can u�lise these develop-
ments in the right way will have a great opportu-
nity. Companies must adapt to the changes in
order to grow. Communica�on is becoming easier
with the advent of 4G technology. Insurance
companies must seize this opportunity to reach
out and communicate with their customers.
The Government is assis�ng the growth of the
insurance sector with its various ini�a�ves.
Pla�orms such as Digital India, Make in India,
'JAM' (Jan Dhan, Aadhar and Mobile) and
schemes such as Bima Suraksha Yojana, all give a
big push to the industry. The key for survival is to
tag on to these ini�a�ves. "Whoever is going to
ride that wave is going to be a winner," he
predicted.
The rise of digital also drives the thought process
of the regulator, disclosed Mr Vijayan. Digital
pla�orms such as e-KYC, insurance repositories,
e-commerce and e-policies can be harnessed
posi�vely and are being examined to see if sales
and renewals can be made easier. A central KYC
registry and dematerialisa�on of insurance
policies are also being mooted. He hoped that
insurance gets centralised once GST comes into
force. Other legisla�ve changes are on the anvil,
and the industry should see these changes as
opportuni�es and tag on to them.
Industry must not be shy of innova�on. Product
innova�ons must accompany the changes in the
business ecosystem. Not all of them will be
successful. There may be failures, but "we should
be ready to pay for the failure." O�en, felt Mr
Vijayan, industry barons resist bringing in new
products, ci�ng regulatory restric�ons. He
disclosed that he is open to changing regula�ons
if the industry and the people are benefi�ed.
"Regula�ons are not something wri�en in stone,"
he declared. "You bring the product, let us see."
Technology may even enable the industry to half
its management expenses. "The biggest
challenge in insurance is not on the first sale," he
pointed out. The challenge is in renewal.
Somebody has to follow up with the policy holder.
Constant innova�on can create customised
products that con�nue to remain a�rac�ve.
Digital can help in this, and renewal can be built
into the process. The ini�al enthusiasm of the
customer should be retained through con�nuous
communica�on, and lowering communica�on
costs is essen�al.
With 23 crore policies and 20 lakh agents in the
system, a huge amount of data is available.
Analy�cs can help in ascertaining the chances
that a policy will be renewed, or whether the
agent will con�nue with the customer. The great
challenge before the industry is to use analy�cs to
understand and find an answer to the business
problems. Manpower is very important for the
insurance industry. Training must be provided for
the agents to be able to con�nue and re-sell
policies and engage with the end users.
On a lighter note, Mr Vijayan ended by observing
that FICCI has provided a forum for insurers to
discuss about these developments, and possibly
some companies may base their ac�on plans on
FINCON 2017: Conference Proceedings 13
the delibera�ons. He was aware that those plans
would not be shared by the companies in order to
gain a compe��ve edge. But he was unperturbed.
"Ul�mately I will come to know all the decisions."
He looked forward to the changes that companies
were planning, in order to make the customer
happier and take Indian insurance to the level of
advanced markets.
Concluding Remarks: Mr G Srinivasan, Co-
chairman, FICCI Commi�ee on Insurance &
Pensions and Chairman cum Managing Director,
The New India Assurance Co Ltd.
Mr Srinivasan thanked Mr Vijayan for his vote of
confidence in the insurance industry, and also for
agreeing to review the regula�ons if required.
Con�nuing from Mr Vijayan's theme of 'change',
Mr Srinivasan described the last two years as "the
most happening phase of the insurance industry."
With the large number of regulatory changes and
the amendments to the Insurance Act, change
will be the only constant in the industry, he felt.
The changes will be so phenomenal that the
en�re face of the industry will be transformed in
the coming years. In fact, he could not predict
what the insurance industry would look like in
2020.
Mr Srinivasan iden�fied the catalysts that will
drive this change:
l Technology: The insurtech invasion, with its
focus on data analy�cs and fraud control
ini�a�ves will dominate the industry in the
coming years and will be cri�cal for its
future.
l Compe��on: It usually brings out the best,
but some�mes even the worst among
insurance companies. But it will definitely
change the face of the industry in the
coming years.
l Regulatory changes.
l Customer aspira�ons: Today, the customer
wants the best and is clear about what s/he
wants. Customer expecta�ons will drive the
industry to change itself.
l Managing high growth: The next 10 years
will see high growth both in the life and non-
life sectors.
Mr Srinivasan was hopeful that by 2020 the Indian
insurance industry will be an industry of growth,
one that is profitable, customer-focused and
compliant with regula�ons, not only in le�er but
also in spirit. He also hoped the industry would
get its due status in the country and in society. To
reach this goal, two things will be required:
capital, which may not be difficult to procure; but
more important, people who have the domain
exper�se that the industry needs. The la�er is an
area that seems to be ge�ng ignored. Focus
should now be on crea�ng the infrastructure
required to produce the kind of people that the
industry needs.
FINCON 2017: Conference Proceedings 14
SESSION IThe New Shareholders
Session moderated by Mr Alpesh Shah, Senior Partner and Managing Director, The Boston Consul�ng Group.
Panellists:
l Ms Alice G Vaidyan, Chairman cum Managing Director, General Insurance Corpora�on of India.
l Mr Rajesh Sud , Vice Chairman and Managing Director, Max Life Insurance Co Ltd.
l Mr G Srinivasan, Co-chairman, FICCI Commi�ee on Insurance & Pensions and Chairman cum Managing Director, The New India Assurance Co Ltd.
l Mr Neelesh Garg, Managing Director and Chief Execu�ve Officer, Tata AIG General Insurance Co Ltd.
l Mr. Sakate Khaitan, Senior Partner, Khaitan
Legal Associates.
Overview by Mr Alpesh Shah:
In the next three to four years, the insurance
industry is likely to see new types of shareholders.
The reasons for this are as follows:
l Many insurance companies are now ge�ng
listed. The companies ge�ng listed are not
only private organisa�ons, but also PSU
companies.
l A number of mergers and acquisi�ons are
taking place, which is bringing in new
shareholders. These new shareholders
come with different expecta�ons about
what they want to achieve.
l New sources of capital.
FINCON 2017: Conference Proceedings 15
the delibera�ons. He was aware that those plans
would not be shared by the companies in order to
gain a compe��ve edge. But he was unperturbed.
"Ul�mately I will come to know all the decisions."
He looked forward to the changes that companies
were planning, in order to make the customer
happier and take Indian insurance to the level of
advanced markets.
Concluding Remarks: Mr G Srinivasan, Co-
chairman, FICCI Commi�ee on Insurance &
Pensions and Chairman cum Managing Director,
The New India Assurance Co Ltd.
Mr Srinivasan thanked Mr Vijayan for his vote of
confidence in the insurance industry, and also for
agreeing to review the regula�ons if required.
Con�nuing from Mr Vijayan's theme of 'change',
Mr Srinivasan described the last two years as "the
most happening phase of the insurance industry."
With the large number of regulatory changes and
the amendments to the Insurance Act, change
will be the only constant in the industry, he felt.
The changes will be so phenomenal that the
en�re face of the industry will be transformed in
the coming years. In fact, he could not predict
what the insurance industry would look like in
2020.
Mr Srinivasan iden�fied the catalysts that will
drive this change:
l Technology: The insurtech invasion, with its
focus on data analy�cs and fraud control
ini�a�ves will dominate the industry in the
coming years and will be cri�cal for its
future.
l Compe��on: It usually brings out the best,
but some�mes even the worst among
insurance companies. But it will definitely
change the face of the industry in the
coming years.
l Regulatory changes.
l Customer aspira�ons: Today, the customer
wants the best and is clear about what s/he
wants. Customer expecta�ons will drive the
industry to change itself.
l Managing high growth: The next 10 years
will see high growth both in the life and non-
life sectors.
Mr Srinivasan was hopeful that by 2020 the Indian
insurance industry will be an industry of growth,
one that is profitable, customer-focused and
compliant with regula�ons, not only in le�er but
also in spirit. He also hoped the industry would
get its due status in the country and in society. To
reach this goal, two things will be required:
capital, which may not be difficult to procure; but
more important, people who have the domain
exper�se that the industry needs. The la�er is an
area that seems to be ge�ng ignored. Focus
should now be on crea�ng the infrastructure
required to produce the kind of people that the
industry needs.
FINCON 2017: Conference Proceedings 14
SESSION IThe New Shareholders
Session moderated by Mr Alpesh Shah, Senior Partner and Managing Director, The Boston Consul�ng Group.
Panellists:
l Ms Alice G Vaidyan, Chairman cum Managing Director, General Insurance Corpora�on of India.
l Mr Rajesh Sud , Vice Chairman and Managing Director, Max Life Insurance Co Ltd.
l Mr G Srinivasan, Co-chairman, FICCI Commi�ee on Insurance & Pensions and Chairman cum Managing Director, The New India Assurance Co Ltd.
l Mr Neelesh Garg, Managing Director and Chief Execu�ve Officer, Tata AIG General Insurance Co Ltd.
l Mr. Sakate Khaitan, Senior Partner, Khaitan
Legal Associates.
Overview by Mr Alpesh Shah:
In the next three to four years, the insurance
industry is likely to see new types of shareholders.
The reasons for this are as follows:
l Many insurance companies are now ge�ng
listed. The companies ge�ng listed are not
only private organisa�ons, but also PSU
companies.
l A number of mergers and acquisi�ons are
taking place, which is bringing in new
shareholders. These new shareholders
come with different expecta�ons about
what they want to achieve.
l New sources of capital.
FINCON 2017: Conference Proceedings 15
What do these changes imply? Mr Alpesh Shah
felt they would impact the insurance sector in a
few specific areas. These outcomes would also
pose challenges to the industry.
(i) The need for educa�ng the investor
community at large. This includes the
general public, analysts and investors.
These segments will have different levels of
awareness. Foreign ins�tu�onal investors
may have a high degree of knowledge about
the business, but general investors in India
may not be as aware. The right vocabulary
will have to be created for all of them. This is
an opportunity as well as a challenge. All
segments must be comfortable with and
able to jargonise the terminology used.
Concepts such as GWP (Gross Wri�en
Premium), NWP (Net Wri�en Premium),
loss ra�os and combined ra�os will have to
be carefully explained. The industry will
need to work with the investor community.
(ii) Insurance is not one business. It includes
life, non-life, health, re-insurance etc. Each
of these businesses has a very different
nuance; and consequently, a different need
for ge�ng the right metrics and the right
vocabulary.
(iii) Achieving balance between the short and
medium term. So far, insurers have had the
luxury of taking medium to long term calls.
But "along with lis�ng comes the quarter se
quarter tak phenomenon." Targets are
evaluated every quarter, just as in other
industries.
(iv) Management and governance issues. This
again is an opportunity and a challenge.
" H o w d o y o u m a n a g e d i ff e r e n t
shareholders with different perspec�ves
and maybe different priori�es?" This
becomes par�cularly problema�c when
there is one majority shareholder whose
ethos does not gel with that of the others.
(v) Crea�ng value-accre�ve mergers and
acquisi�ons (M&As) rather than ego-
accre�ve M&As.
Having set the topic in context, the discussion was
thrown open to the panellists to express their
views.
Panellists' Views:
l Mr Rajesh Sud , Vice Chairman and
Managing Director, Max Life Insurance Co
Ltd.
Se�ng the context with a historical overview of
his company, Mr Sud informed the audience that
they started their journey in 2001. In 2012 they
had a change of shareholders with the exit of New
York Life. They now have a Japanese partner,
Mitsui Sumitomo, which owns 26% of the
company. Max India, the dominant Indian
promoter, then ver�calised itself; one of the
ver�cals, listed as Max Financial Services, became
a pure life insurance business because it holds the
equity in Max Life. So in that sense the company is
quasi-listed. "Our performance immediately gets
reflected in the overall price that Max Financial
Services commands on the markets."
Mr Sud disclosed that Max Life is currently in the
midst of a merger with HDFC Life, which is
awai�ng regulatory approvals.
He agreed with Mr Alpesh Shah that when
businesses become large, they have to assume a
lot of responsibili�es and expecta�ons. Mul�ple
investors bring in "a significant difference in
investment philosophy."
The measurement of performance, he felt, is a
debatable ques�on. For example, an American
insurer may measure insurance success in a
FINCON 2017: Conference Proceedings 16
manner very different to a European investor, or
an Indian promoter. All these are relevant
stakeholders who have a righ�ul view about the
right measure of success. Hence the management
team must strive to work towards a "convergent
dashboard."
This is actually one of the biggest issues faced by
the insurance business. There is a lack of
adequate repor�ng benchmarks, no clarity on the
right measure and complexity in the way business
is reported.
"If you ever try and run a life insurance company
to the stock market's expecta�ons you will
probably run it aground," he said, because that is
the nature of the business. A product sale in life
insurance will always bring in a loss. This does not
look good on statutory report books. If a company
has hyper-growth, it will look as though it is not
doing well on the P&L. "But is that the real
assessment?" he asked. These dilemmas are
inherent in the way the industry is set up.
One of the ways in which regulators and
accoun�ng standards address the issue is by
DACing (deferred acquisi�on costs), where the
expenses, par�cularly the acquisi�on expenses,
are deferred over the life of the policy. A�er that
the revenue and expenses are matched. There are
accoun�ng standards that govern this.
But insurance is definitely not for the short run. It
is not something that one can buy for a quick gain.
A well-run business may be like a safe annuity
income and keep growing by a steady 15–20%.
"It's not going to be your mul�bagger," he
concluded.
l Mr G Srinivasan, Co-chairman, FICCI
Commi�ee on Insurance & Pensions and
Chairman cum Managing Director, The New
India Assurance Co Ltd.
Mr Srinivasan began by sta�ng, "Lis�ng is
something inevitable for the insurance industry."
It is bound to happen, and there are quite a few
advantages of companies being on the stock
market. Lis�ng, he felt, will raise the industry's
brand value and lead to be�er insurance
penetra�on. It will also improve disclosures and
governance. He applauded the efforts of the
Government of India for insis�ng that public
sector insurance companies also get listed.
The biggest issue, according to him, is whether
the new shareholders will be able to understand
the insurance business. He wondered whether
financial analysts will grasp the technicali�es of
the insurance industry or view it with the same
lens that they do the FMCG or banking sectors.
There is a risk that they may only focus on the
dividends or profit a�er tax. But that is not the
way insurance companies should be evaluated,
because inherently, insurance means not only
profits, but how reserves are built. This is a major
challenge. "There is a need for us to educate the
wider ecosystem for a be�er understanding of the
insurance sector."
The second challenge is the 'quarter to quarter
syndrome' that Mr Alpesh Shah alluded to.
Insurance being a vola�le sector, it may bring in
profits in one quarter and losses in the next. This
is something that the market is not used to,
because the Indian market especially looks at
growth in profits on a quarter to quarter basis.
This can mislead investors.
The third challenge is how to manage the
different categories of investors. There are three
kinds of investors: (a) retail investors, (b)
ins�tu�onal investors and (c) the Government.
They will have different objec�ves. Retail
investors will look for profits; ins�tu�onal
investors will want to study the companies'
performance; and the Government will have
FINCON 2017: Conference Proceedings 17
What do these changes imply? Mr Alpesh Shah
felt they would impact the insurance sector in a
few specific areas. These outcomes would also
pose challenges to the industry.
(i) The need for educa�ng the investor
community at large. This includes the
general public, analysts and investors.
These segments will have different levels of
awareness. Foreign ins�tu�onal investors
may have a high degree of knowledge about
the business, but general investors in India
may not be as aware. The right vocabulary
will have to be created for all of them. This is
an opportunity as well as a challenge. All
segments must be comfortable with and
able to jargonise the terminology used.
Concepts such as GWP (Gross Wri�en
Premium), NWP (Net Wri�en Premium),
loss ra�os and combined ra�os will have to
be carefully explained. The industry will
need to work with the investor community.
(ii) Insurance is not one business. It includes
life, non-life, health, re-insurance etc. Each
of these businesses has a very different
nuance; and consequently, a different need
for ge�ng the right metrics and the right
vocabulary.
(iii) Achieving balance between the short and
medium term. So far, insurers have had the
luxury of taking medium to long term calls.
But "along with lis�ng comes the quarter se
quarter tak phenomenon." Targets are
evaluated every quarter, just as in other
industries.
(iv) Management and governance issues. This
again is an opportunity and a challenge.
" H o w d o y o u m a n a g e d i ff e r e n t
shareholders with different perspec�ves
and maybe different priori�es?" This
becomes par�cularly problema�c when
there is one majority shareholder whose
ethos does not gel with that of the others.
(v) Crea�ng value-accre�ve mergers and
acquisi�ons (M&As) rather than ego-
accre�ve M&As.
Having set the topic in context, the discussion was
thrown open to the panellists to express their
views.
Panellists' Views:
l Mr Rajesh Sud , Vice Chairman and
Managing Director, Max Life Insurance Co
Ltd.
Se�ng the context with a historical overview of
his company, Mr Sud informed the audience that
they started their journey in 2001. In 2012 they
had a change of shareholders with the exit of New
York Life. They now have a Japanese partner,
Mitsui Sumitomo, which owns 26% of the
company. Max India, the dominant Indian
promoter, then ver�calised itself; one of the
ver�cals, listed as Max Financial Services, became
a pure life insurance business because it holds the
equity in Max Life. So in that sense the company is
quasi-listed. "Our performance immediately gets
reflected in the overall price that Max Financial
Services commands on the markets."
Mr Sud disclosed that Max Life is currently in the
midst of a merger with HDFC Life, which is
awai�ng regulatory approvals.
He agreed with Mr Alpesh Shah that when
businesses become large, they have to assume a
lot of responsibili�es and expecta�ons. Mul�ple
investors bring in "a significant difference in
investment philosophy."
The measurement of performance, he felt, is a
debatable ques�on. For example, an American
insurer may measure insurance success in a
FINCON 2017: Conference Proceedings 16
manner very different to a European investor, or
an Indian promoter. All these are relevant
stakeholders who have a righ�ul view about the
right measure of success. Hence the management
team must strive to work towards a "convergent
dashboard."
This is actually one of the biggest issues faced by
the insurance business. There is a lack of
adequate repor�ng benchmarks, no clarity on the
right measure and complexity in the way business
is reported.
"If you ever try and run a life insurance company
to the stock market's expecta�ons you will
probably run it aground," he said, because that is
the nature of the business. A product sale in life
insurance will always bring in a loss. This does not
look good on statutory report books. If a company
has hyper-growth, it will look as though it is not
doing well on the P&L. "But is that the real
assessment?" he asked. These dilemmas are
inherent in the way the industry is set up.
One of the ways in which regulators and
accoun�ng standards address the issue is by
DACing (deferred acquisi�on costs), where the
expenses, par�cularly the acquisi�on expenses,
are deferred over the life of the policy. A�er that
the revenue and expenses are matched. There are
accoun�ng standards that govern this.
But insurance is definitely not for the short run. It
is not something that one can buy for a quick gain.
A well-run business may be like a safe annuity
income and keep growing by a steady 15–20%.
"It's not going to be your mul�bagger," he
concluded.
l Mr G Srinivasan, Co-chairman, FICCI
Commi�ee on Insurance & Pensions and
Chairman cum Managing Director, The New
India Assurance Co Ltd.
Mr Srinivasan began by sta�ng, "Lis�ng is
something inevitable for the insurance industry."
It is bound to happen, and there are quite a few
advantages of companies being on the stock
market. Lis�ng, he felt, will raise the industry's
brand value and lead to be�er insurance
penetra�on. It will also improve disclosures and
governance. He applauded the efforts of the
Government of India for insis�ng that public
sector insurance companies also get listed.
The biggest issue, according to him, is whether
the new shareholders will be able to understand
the insurance business. He wondered whether
financial analysts will grasp the technicali�es of
the insurance industry or view it with the same
lens that they do the FMCG or banking sectors.
There is a risk that they may only focus on the
dividends or profit a�er tax. But that is not the
way insurance companies should be evaluated,
because inherently, insurance means not only
profits, but how reserves are built. This is a major
challenge. "There is a need for us to educate the
wider ecosystem for a be�er understanding of the
insurance sector."
The second challenge is the 'quarter to quarter
syndrome' that Mr Alpesh Shah alluded to.
Insurance being a vola�le sector, it may bring in
profits in one quarter and losses in the next. This
is something that the market is not used to,
because the Indian market especially looks at
growth in profits on a quarter to quarter basis.
This can mislead investors.
The third challenge is how to manage the
different categories of investors. There are three
kinds of investors: (a) retail investors, (b)
ins�tu�onal investors and (c) the Government.
They will have different objec�ves. Retail
investors will look for profits; ins�tu�onal
investors will want to study the companies'
performance; and the Government will have
FINCON 2017: Conference Proceedings 17
different objec�ves, even social objec�ves. This
will need to be managed by the industry.
But in the end, he said, "Lis�ng is something
posi�ve both for the company as well as for the
sector."
l Ms Alice G Vaidyan, Chairman cum
Managing Director, General Insurance
Corpora�on of India
Ms Vaidyan felt that GIC is in a very unique space,
even as far as insurance is concerned. India has
never had a reinsurer, so GIC has always been the
na�onal reinsurer. "If it is difficult to explain
general insurance to an investor, then explaining
reinsurance would be more of a challenge to the
investor crowd," she said.
Another challenge for GIC is that because there
are no peers in the Indian market, they are
benchmarked with global peers. The Indian
investor and a foreign ins�tu�onal investor will
view the reinsurance market very differently.
She felt the government ini�a�ve of lis�ng is very
welcome. It will give insurance companies,
especially reinsurers—because they don't have
any interac�on with the public—that long-
awaited visibility. Since reinsurers interact with
foreign insurance companies, they will get
visibility "not only in the Indian market but also in
the interna�onal market space." This will bring in
market capitalisa�on. She appreciated that the
Government is encouraging the common man to
par�cipate in the working of PSUs by ge�ng them
listed. So far, PSUs have had only book value; to
have market value will be a great boost and they
will be able to compete with their interna�onal
peers.
But the big challenge is how to evaluate the
performance of the company. "What parameter
do you sell to the market?" she ques�oned. From
a reinsurer perspec�ve, she felt that combined
ra�os will be one of the most important factors to
evaluate a company. She agreed with the other
panellists that a short-term view cannot be taken
for an insurance company. "Insurance is a
business where you hedge different lines of
business over a long period of �me," she
explained.
Overall, this is a very good �me for the insurance
companies to list. The industry will benefit from
the huge transforma�onal changes that are
sweeping it.
l Mr Neelesh Garg, Managing Director and
Chief Execu�ve Officer, Tata AIG General
Insurance Co Ltd.
"There has been a lot of significant new investor
interest for the last two years, including private
equi�es," began Mr Garg. But he felt there were
three large issues affec�ng general insurance post
priva�sa�on:
(i) Financial performance: The general
insurance industry made an underwri�ng
loss of about Rs 16000 crore in 2015-16,
with ROEs in the range of about seven per
cent of that.
(ii) The overall aspect of corporate governance,
market conduct and the qual ity of
d isc losures that general insurance
companies make to the public.
(iii) The ques�on about the level of sophis�ca-
�on of the Indian general insurance
industry post de-tariffing. This would
include the quality of risk management
models; risk pricing models; processes and
technologies; and product innova�on.
"I feel the conversa�on between the shareholder
and the management is a very important input
FINCON 2017: Conference Proceedings 18
into all of these factors," observed Mr Garg. It
helps in enhancing corporate governance,
scru�ny and market conduct. With the arrival of
new strategic investors, such tough conversa�ons
with the management will be very posi�ve for the
development of the industry.
He agreed that terminology is very important.
Today there is not enough apprecia�on between
a good, average and bad business model. The
investor community may not appreciate the
nuances in terms of the quality distribu�on,
customer segmenta�on, or risk management.
Two start-up companies having the same
combined ra�o could have significantly different
business models. "One tends to look at all of them
with a similar lens," he felt. Dialogue with the
investor community wil l help the la�er
understand the nuances of business models and
dis�nguish between good, average and bad
business models.
Overall, he felt the changes in the insurance
industry will be beneficial for its development.
l Mr Sakate Khaitan, Senior Partner, Khaitan
Legal Associates
Mr Khaitan approached the problem from a
different angle. "Why are we raising money?" he
asked. He reasoned that if money is being raised
to grow as currency, then once it is raised it
depends on who the stakeholder is. "The
important bit here is regulatory," he said, poin�ng
out that the lis�ng guidelines mandate that the
exis�ng promoters con�nue to hold 50% of the
insurer who is listed. In other words, the
management reports to the biggest stakeholder,
which is the exis�ng promoter.
He cited two other interes�ng aspects of the
regula�ons. Any person acquiring more than one
per cent of a listed insurer needs to meet certain
criteria; if the insurer believes that the criteria are
not met, it goes to the regulator who may ask the
investor to divest. There are similar regulatory
criteria for between five and ten per cent, and
then over ten per cent. Prior approval is needed
from the regulator. This implies that the "market
is not efficient." It implies that the management
and majority stakeholder will not answer to the
small investor.
Hence one needs to be clear about why one is
inves�ng in an insurer. "Why is the insurance
company raising money and what am I going to
get out of it?" Can the investor control liquidity
and be able to get capital gains and benefit from
the company? The only way to appreciate and
invest in insurance companies is to understand
how the industry works.
The second interes�ng aspect about the
regula�ons is that they are absolutely quiet about
the incen�ve for management. This means that
investors must have sufficient clout to ensure that
the management's KPIs are effec�vely aligned to
return to the small investor. If the regulator says
that the promoter cannot reduce its stake below
50%, what is the incen�ve for management to
bother about the small investors?
A noteworthy point about state-owned insurers
coming on to the market is that they will no longer
be covered by the sovereign put. "Are they
compe�ng in the market on their own balance
sheet or are they actually compe�ng in the
FINCON 2017: Conference Proceedings 19
different objec�ves, even social objec�ves. This
will need to be managed by the industry.
But in the end, he said, "Lis�ng is something
posi�ve both for the company as well as for the
sector."
l Ms Alice G Vaidyan, Chairman cum
Managing Director, General Insurance
Corpora�on of India
Ms Vaidyan felt that GIC is in a very unique space,
even as far as insurance is concerned. India has
never had a reinsurer, so GIC has always been the
na�onal reinsurer. "If it is difficult to explain
general insurance to an investor, then explaining
reinsurance would be more of a challenge to the
investor crowd," she said.
Another challenge for GIC is that because there
are no peers in the Indian market, they are
benchmarked with global peers. The Indian
investor and a foreign ins�tu�onal investor will
view the reinsurance market very differently.
She felt the government ini�a�ve of lis�ng is very
welcome. It will give insurance companies,
especially reinsurers—because they don't have
any interac�on with the public—that long-
awaited visibility. Since reinsurers interact with
foreign insurance companies, they will get
visibility "not only in the Indian market but also in
the interna�onal market space." This will bring in
market capitalisa�on. She appreciated that the
Government is encouraging the common man to
par�cipate in the working of PSUs by ge�ng them
listed. So far, PSUs have had only book value; to
have market value will be a great boost and they
will be able to compete with their interna�onal
peers.
But the big challenge is how to evaluate the
performance of the company. "What parameter
do you sell to the market?" she ques�oned. From
a reinsurer perspec�ve, she felt that combined
ra�os will be one of the most important factors to
evaluate a company. She agreed with the other
panellists that a short-term view cannot be taken
for an insurance company. "Insurance is a
business where you hedge different lines of
business over a long period of �me," she
explained.
Overall, this is a very good �me for the insurance
companies to list. The industry will benefit from
the huge transforma�onal changes that are
sweeping it.
l Mr Neelesh Garg, Managing Director and
Chief Execu�ve Officer, Tata AIG General
Insurance Co Ltd.
"There has been a lot of significant new investor
interest for the last two years, including private
equi�es," began Mr Garg. But he felt there were
three large issues affec�ng general insurance post
priva�sa�on:
(i) Financial performance: The general
insurance industry made an underwri�ng
loss of about Rs 16000 crore in 2015-16,
with ROEs in the range of about seven per
cent of that.
(ii) The overall aspect of corporate governance,
market conduct and the qual ity of
d isc losures that general insurance
companies make to the public.
(iii) The ques�on about the level of sophis�ca-
�on of the Indian general insurance
industry post de-tariffing. This would
include the quality of risk management
models; risk pricing models; processes and
technologies; and product innova�on.
"I feel the conversa�on between the shareholder
and the management is a very important input
FINCON 2017: Conference Proceedings 18
into all of these factors," observed Mr Garg. It
helps in enhancing corporate governance,
scru�ny and market conduct. With the arrival of
new strategic investors, such tough conversa�ons
with the management will be very posi�ve for the
development of the industry.
He agreed that terminology is very important.
Today there is not enough apprecia�on between
a good, average and bad business model. The
investor community may not appreciate the
nuances in terms of the quality distribu�on,
customer segmenta�on, or risk management.
Two start-up companies having the same
combined ra�o could have significantly different
business models. "One tends to look at all of them
with a similar lens," he felt. Dialogue with the
investor community wil l help the la�er
understand the nuances of business models and
dis�nguish between good, average and bad
business models.
Overall, he felt the changes in the insurance
industry will be beneficial for its development.
l Mr Sakate Khaitan, Senior Partner, Khaitan
Legal Associates
Mr Khaitan approached the problem from a
different angle. "Why are we raising money?" he
asked. He reasoned that if money is being raised
to grow as currency, then once it is raised it
depends on who the stakeholder is. "The
important bit here is regulatory," he said, poin�ng
out that the lis�ng guidelines mandate that the
exis�ng promoters con�nue to hold 50% of the
insurer who is listed. In other words, the
management reports to the biggest stakeholder,
which is the exis�ng promoter.
He cited two other interes�ng aspects of the
regula�ons. Any person acquiring more than one
per cent of a listed insurer needs to meet certain
criteria; if the insurer believes that the criteria are
not met, it goes to the regulator who may ask the
investor to divest. There are similar regulatory
criteria for between five and ten per cent, and
then over ten per cent. Prior approval is needed
from the regulator. This implies that the "market
is not efficient." It implies that the management
and majority stakeholder will not answer to the
small investor.
Hence one needs to be clear about why one is
inves�ng in an insurer. "Why is the insurance
company raising money and what am I going to
get out of it?" Can the investor control liquidity
and be able to get capital gains and benefit from
the company? The only way to appreciate and
invest in insurance companies is to understand
how the industry works.
The second interes�ng aspect about the
regula�ons is that they are absolutely quiet about
the incen�ve for management. This means that
investors must have sufficient clout to ensure that
the management's KPIs are effec�vely aligned to
return to the small investor. If the regulator says
that the promoter cannot reduce its stake below
50%, what is the incen�ve for management to
bother about the small investors?
A noteworthy point about state-owned insurers
coming on to the market is that they will no longer
be covered by the sovereign put. "Are they
compe�ng in the market on their own balance
sheet or are they actually compe�ng in the
FINCON 2017: Conference Proceedings 19
market because they have the sovereign put? The
jury is s�ll out." It is not yet clear whether the
market can absorb these lis�ngs. Mr Khaitan felt
that the Indian market is shallow; and if large
ins�tu�onal investors will not be allowed to invest
in a free manner, the company's security has to be
marketable and the company should be able to
exit any �me. That is not the case today.
Analysts will not be able to assess performance
accurately in the near to medium term. It will
need a larger shareholder base, where share-
holder ac�vism can play out in shareholder
mee�ngs and EGMs.
Today the Indian market has 30 insurers who are
carrying out mergers and acquisi�ons among
themselves. That leads to consolida�on, which in
turn leads to monopolis�c and oligopolis�c
prac�ces. These are not good for the market. Why
is this happening? In Mr Khaitan's opinion, this is
happening because the distribu�on chain is
broken. "And penetra�on cannot be achieved �ll
distribu�on is effec�vely democra�sed." When
that happens, small investors will understand the
insurance business and shareholders will start
inves�ng in insurance companies.
l Discussion:
Mr Srinivasan on the other hand pointed out that
general insurers are not covered by any sovereign
put and work on their balance sheets, even
though they are 100% co-owned. He also
clarified, in response to a query, that only LIC has
sovereign guarantee and the company does not
really use it. Second, regulatory restric�ons are
necessary to protect the policy holders' interests;
but this does not deter ins�tu�onal investors.
"Even today we see a lot of ins�tu�onal investors
approaching us," he said. Adding to this,
Mr Alpesh Shah felt that even if mergers and
acquisi�ons are restricted to the top few
companies in the market,this need not
necessarily lead to monopolis�c and oligopolis�c
behaviour.
Ms Vaidyanathan felt that the domes�c percep-
�on about government companies may be very
different from foreign percep�on. As soon as the
announcement was made, foreign investors have
been showing a lot of interest in both New India
and GIC. She inferred that it is the brand image of
both these companies that is bringing in investor
interest and appe�te.
A member of the aud ience a l luded to
Mr Khaitan's point about the need to protect
investors. Ul�mately it is the policy holders who
need to be protected, and the regula�ons are
there to protect them. If the management runs
the company well, the investors will automa�cally
make a profit. He felt that insurers seem to be
underes�ma�ng the intelligence of the Indian
investors. Mr Khaitan's response was that as far as
lis�ng is concerned, the investor is the most
important. The regulatory environment creates
risks for investors.
Another query was raised from the delegates to
understand how reinsurers in emerging markets
will cope with the commitments made to clients
a�er undergoing unforeseen losses. And, with
respect to the 50% shareholding clause, how
investors will react to that situa�on if the KPIs of
the management are not set. Mr Srinivasan
responded that every insurance company has its
own plan and reinsurance protec�ons to meet its
commitments. Regarding the 50% cap, he
men�oned that the majority shareholder who
has a bigger stake in the company is interested in
its well-being because his money is at stake. But
he accepted the sugges�on that the minority
shareholder should also be protected. Mr Khaitan
clarified that there is deep regulatory insight in
the 50% cap, because insurance by its very nature
FINCON 2017: Conference Proceedings 20
requires an anchor investor.
Con�nuing the discussion around the regulatory
framework, another audience member won-
dered why IRDAI cannot just mandate insurers to
keep providing disclosures to the investor
community as this informa�on is important for
investors to analyse an insurance company. "One
step at a �me," was Mr Sud's response. The
regulator and the industry have already come a
long way from the �me when only sales were
being reported.
Another audience member asked whether there
is scope to make policy holders shareholders.
While an investor will be concerned primarily
with profits or dividends, a customer will be more
concerned about coverage and cost. Mr Khaitan
replied in the affirma�ve, poin�ng out that the
recent change to the Insurance Act has got
enabling provisions that allow that to happen.
Mr Srinivasan suggested that the concept of
mutuals and coopera�ves that exist in other parts
of the world can also be looked at for the Indian
market, so that policy holders can become
shareholders. Mr Sud pointed out that the
tradi�onal fund actually operates to the
philosophy of mutuality, so although not at the
shareholder level, policy holders do par�cipate in
the ups and downs of the fund. But he thought it
will be difficult, even with an enabling provision,
to move from corporate en��es into mutual
en��es.
One member of the audience referred back to the
ques�on that Mr Khaitan asked ini�ally about
whom all this is being done for, when the industry
hasn't been producing profits. That needs to be
answered. Mr Alpesh Shah agreed with him. He
believed that is the crux of the issue, but that it
would not be answered and closed in a day.
FINCON 2017: Conference Proceedings 21
market because they have the sovereign put? The
jury is s�ll out." It is not yet clear whether the
market can absorb these lis�ngs. Mr Khaitan felt
that the Indian market is shallow; and if large
ins�tu�onal investors will not be allowed to invest
in a free manner, the company's security has to be
marketable and the company should be able to
exit any �me. That is not the case today.
Analysts will not be able to assess performance
accurately in the near to medium term. It will
need a larger shareholder base, where share-
holder ac�vism can play out in shareholder
mee�ngs and EGMs.
Today the Indian market has 30 insurers who are
carrying out mergers and acquisi�ons among
themselves. That leads to consolida�on, which in
turn leads to monopolis�c and oligopolis�c
prac�ces. These are not good for the market. Why
is this happening? In Mr Khaitan's opinion, this is
happening because the distribu�on chain is
broken. "And penetra�on cannot be achieved �ll
distribu�on is effec�vely democra�sed." When
that happens, small investors will understand the
insurance business and shareholders will start
inves�ng in insurance companies.
l Discussion:
Mr Srinivasan on the other hand pointed out that
general insurers are not covered by any sovereign
put and work on their balance sheets, even
though they are 100% co-owned. He also
clarified, in response to a query, that only LIC has
sovereign guarantee and the company does not
really use it. Second, regulatory restric�ons are
necessary to protect the policy holders' interests;
but this does not deter ins�tu�onal investors.
"Even today we see a lot of ins�tu�onal investors
approaching us," he said. Adding to this,
Mr Alpesh Shah felt that even if mergers and
acquisi�ons are restricted to the top few
companies in the market,this need not
necessarily lead to monopolis�c and oligopolis�c
behaviour.
Ms Vaidyanathan felt that the domes�c percep-
�on about government companies may be very
different from foreign percep�on. As soon as the
announcement was made, foreign investors have
been showing a lot of interest in both New India
and GIC. She inferred that it is the brand image of
both these companies that is bringing in investor
interest and appe�te.
A member of the aud ience a l luded to
Mr Khaitan's point about the need to protect
investors. Ul�mately it is the policy holders who
need to be protected, and the regula�ons are
there to protect them. If the management runs
the company well, the investors will automa�cally
make a profit. He felt that insurers seem to be
underes�ma�ng the intelligence of the Indian
investors. Mr Khaitan's response was that as far as
lis�ng is concerned, the investor is the most
important. The regulatory environment creates
risks for investors.
Another query was raised from the delegates to
understand how reinsurers in emerging markets
will cope with the commitments made to clients
a�er undergoing unforeseen losses. And, with
respect to the 50% shareholding clause, how
investors will react to that situa�on if the KPIs of
the management are not set. Mr Srinivasan
responded that every insurance company has its
own plan and reinsurance protec�ons to meet its
commitments. Regarding the 50% cap, he
men�oned that the majority shareholder who
has a bigger stake in the company is interested in
its well-being because his money is at stake. But
he accepted the sugges�on that the minority
shareholder should also be protected. Mr Khaitan
clarified that there is deep regulatory insight in
the 50% cap, because insurance by its very nature
FINCON 2017: Conference Proceedings 20
requires an anchor investor.
Con�nuing the discussion around the regulatory
framework, another audience member won-
dered why IRDAI cannot just mandate insurers to
keep providing disclosures to the investor
community as this informa�on is important for
investors to analyse an insurance company. "One
step at a �me," was Mr Sud's response. The
regulator and the industry have already come a
long way from the �me when only sales were
being reported.
Another audience member asked whether there
is scope to make policy holders shareholders.
While an investor will be concerned primarily
with profits or dividends, a customer will be more
concerned about coverage and cost. Mr Khaitan
replied in the affirma�ve, poin�ng out that the
recent change to the Insurance Act has got
enabling provisions that allow that to happen.
Mr Srinivasan suggested that the concept of
mutuals and coopera�ves that exist in other parts
of the world can also be looked at for the Indian
market, so that policy holders can become
shareholders. Mr Sud pointed out that the
tradi�onal fund actually operates to the
philosophy of mutuality, so although not at the
shareholder level, policy holders do par�cipate in
the ups and downs of the fund. But he thought it
will be difficult, even with an enabling provision,
to move from corporate en��es into mutual
en��es.
One member of the audience referred back to the
ques�on that Mr Khaitan asked ini�ally about
whom all this is being done for, when the industry
hasn't been producing profits. That needs to be
answered. Mr Alpesh Shah agreed with him. He
believed that is the crux of the issue, but that it
would not be answered and closed in a day.
FINCON 2017: Conference Proceedings 21
SESSION IIInsurance in a Bionic World
Session moderated by Mr Pranay Mehrotra,
Partner and Director, The Boston Consul�ng
Group.
Panellists:
l Mr K Sanath Kumar, Chairman cum
Managing Director, Na�onal Insurance Co
Ltd.
l Mr Vighnesh Shahane, Chief Execu�ve
Officer & Whole Time - Director, IDBI
Federal Life Insurance Co Ltd.
l Mr Munish Sharda, Managing Director and
Chief Execu�ve Officer, Future Generali
India Life Insurance Co Ltd.
l Mr Sa�sh Pillai, Managing Director and
Chief Execu�ve Officer, TransUnion CIBIL.
l Mr K G Krishnamoorthy Rao, Managing
Director and Chief Execu�ve Officer, Future
Generali India Insurance Co Ltd.
Overview by Mr Pranay Mehrotra:
Mr Mehrotra set the context with a five-point
overview about how digital and data can
transform the insurance sector.
(i) Digital is not about the future, it's actually
here and now. With the digital stack being
created, the country will have "a financial
services infrastructure which is digitally
enabled and which will rival the best in the
world." When over one billion people
transact online, they create data; and India
will move from a data-poor to a data-rich
environment in the next two to three years.
(ii) Business dynamics are changing both
globally and in India. Customer expecta�ons
FINCON 2017: Conference Proceedings 22 FINCON 2017: Conference Proceedings 23
are evolving; they are not being set on the
basis of what they experience with their
insurer, but rather on what they experience
with others in the digital ecosystem. And
technology is now making it feasible for
insurers to re-imagine the customer
experience. Mr Mehrotra cau�oned that
across insurance globally, and in financial
services in India, if conven�onal business
models do not create disrup�on for
themselves, the industry will be disrupted
by non-tradi�onal compe�tors outside the
sector.
(iii) Digital and analy�cs are core to business
strategy, and must not be considered as
addi�onal func�ons. Digital is about re-
imagining the customer journey using
technology and data. And to get a good
ret u r n o n i nve st m e nt , a ny d i g i ta l
transforma�on needs to be driven with
agility.
(iv) Analy�cs is not just about fancy modelling,
but about how to enrich the exis�ng data.
The organisa�on must ensure that the right
data is in place, and work with partners in
the ecosystem who have access to
customers and their data, in order to create
a robust data architecture. The analy�cs
and business teams must work together to
iden�fy the priority use cases and create the
right solu�ons for them.
(v) If digital is u�lised op�mally, the impact for
insurers is not incremental, but significantly
more than that. Adop�on of digital has a
strong transforma�ve impact on business.
Panellists' Views
l Mr K Sanath Kumar, Chairman cum
Managing Director, Na�onal Insurance Co
Ltd.
Mr Sanath Kumar used his experience at the helm
of a large public sector insurer with access to a
large customer set to examine where digital and
analy�cs can enhance a company's market
posi�on.
Speaking about his own company, he men�oned
that they have two levels of data. At level one,
there is data that was generated about three or
four years back, which is huge but not well coded.
It is a chunk of data that cannot be sliced and
diced.
Over the past two or three years, they have been
genera�ng sliced and granular data on a
centralised basis. This data is being used to
understand claims pa�erns and their trends; to
understand their customer profile; and to deal
with stakeholders. But he admi�ed that they are
s�ll not making cu�ng-edge use of the data.
There are a lot of exci�ng avenues in which this
data can be harnessed powerfully. This is the
challenge they are facing.
When asked how they could get the organisa�on
to align around the power of digital, Mr Sanath
Kumar replied that they have already crossed the
bridge of a�tudinal change. "Now we are
absolutely aligned to the need of the digital era,
the need to connect," he said. He explained that
customers want to be handled personally, not in a
generic fashion. They are now able to digitally
empower their agents to do this. "Now the en�re
team is asking for more. There's a huge pull from
our employees and stakeholders for more and
more technology adop�on.”
Mr Mehrotra wanted to know where he saw the
opportunity to use technology and data to
op�mise opera�ons, whether on the cost side or
the claim side, and from a combined ra�o
perspec�ve in the retail or the commercial line of
business. Mr Sanath Kumar's response was that
SESSION IIInsurance in a Bionic World
Session moderated by Mr Pranay Mehrotra,
Partner and Director, The Boston Consul�ng
Group.
Panellists:
l Mr K Sanath Kumar, Chairman cum
Managing Director, Na�onal Insurance Co
Ltd.
l Mr Vighnesh Shahane, Chief Execu�ve
Officer & Whole Time - Director, IDBI
Federal Life Insurance Co Ltd.
l Mr Munish Sharda, Managing Director and
Chief Execu�ve Officer, Future Generali
India Life Insurance Co Ltd.
l Mr Sa�sh Pillai, Managing Director and
Chief Execu�ve Officer, TransUnion CIBIL.
l Mr K G Krishnamoorthy Rao, Managing
Director and Chief Execu�ve Officer, Future
Generali India Insurance Co Ltd.
Overview by Mr Pranay Mehrotra:
Mr Mehrotra set the context with a five-point
overview about how digital and data can
transform the insurance sector.
(i) Digital is not about the future, it's actually
here and now. With the digital stack being
created, the country will have "a financial
services infrastructure which is digitally
enabled and which will rival the best in the
world." When over one billion people
transact online, they create data; and India
will move from a data-poor to a data-rich
environment in the next two to three years.
(ii) Business dynamics are changing both
globally and in India. Customer expecta�ons
FINCON 2017: Conference Proceedings 22 FINCON 2017: Conference Proceedings 23
are evolving; they are not being set on the
basis of what they experience with their
insurer, but rather on what they experience
with others in the digital ecosystem. And
technology is now making it feasible for
insurers to re-imagine the customer
experience. Mr Mehrotra cau�oned that
across insurance globally, and in financial
services in India, if conven�onal business
models do not create disrup�on for
themselves, the industry will be disrupted
by non-tradi�onal compe�tors outside the
sector.
(iii) Digital and analy�cs are core to business
strategy, and must not be considered as
addi�onal func�ons. Digital is about re-
imagining the customer journey using
technology and data. And to get a good
ret u r n o n i nve st m e nt , a ny d i g i ta l
transforma�on needs to be driven with
agility.
(iv) Analy�cs is not just about fancy modelling,
but about how to enrich the exis�ng data.
The organisa�on must ensure that the right
data is in place, and work with partners in
the ecosystem who have access to
customers and their data, in order to create
a robust data architecture. The analy�cs
and business teams must work together to
iden�fy the priority use cases and create the
right solu�ons for them.
(v) If digital is u�lised op�mally, the impact for
insurers is not incremental, but significantly
more than that. Adop�on of digital has a
strong transforma�ve impact on business.
Panellists' Views
l Mr K Sanath Kumar, Chairman cum
Managing Director, Na�onal Insurance Co
Ltd.
Mr Sanath Kumar used his experience at the helm
of a large public sector insurer with access to a
large customer set to examine where digital and
analy�cs can enhance a company's market
posi�on.
Speaking about his own company, he men�oned
that they have two levels of data. At level one,
there is data that was generated about three or
four years back, which is huge but not well coded.
It is a chunk of data that cannot be sliced and
diced.
Over the past two or three years, they have been
genera�ng sliced and granular data on a
centralised basis. This data is being used to
understand claims pa�erns and their trends; to
understand their customer profile; and to deal
with stakeholders. But he admi�ed that they are
s�ll not making cu�ng-edge use of the data.
There are a lot of exci�ng avenues in which this
data can be harnessed powerfully. This is the
challenge they are facing.
When asked how they could get the organisa�on
to align around the power of digital, Mr Sanath
Kumar replied that they have already crossed the
bridge of a�tudinal change. "Now we are
absolutely aligned to the need of the digital era,
the need to connect," he said. He explained that
customers want to be handled personally, not in a
generic fashion. They are now able to digitally
empower their agents to do this. "Now the en�re
team is asking for more. There's a huge pull from
our employees and stakeholders for more and
more technology adop�on.”
Mr Mehrotra wanted to know where he saw the
opportunity to use technology and data to
op�mise opera�ons, whether on the cost side or
the claim side, and from a combined ra�o
perspec�ve in the retail or the commercial line of
business. Mr Sanath Kumar's response was that
FINCON 2017: Conference Proceedings 24
combined ra�o is a big challenge for non-life
players, whether in the public or private sector in
India. The technology can be used to understand
the profitability of segments, the products within
the segments, and the distribu�on channels. It
can also provide a predic�ve mechanism for the
future, which can help the company add
products, see the trends and tweak the pricing.
Fraud analysis is now ge�ng increased priority
among general insurance players, because "if we
can reduce even five per cent of that, it will
translate into huge sums and show a direct impact
on the combined ra�o.”
Using advanced analy�cs calls for sound decision
making, he observed. It will require online
portals, access, mobility solu�ons, data
warehousing and grievance mechanisms. The
company has to take a call on the ROI, whether it
is worth the investment or can they manage with
the basic analy�cs that comes with exis�ng
so�ware packages. There is also the issue of the
technology ge�ng outdated quickly. That could
lead to the en�re investment being lost. Hence
the need for cu�ng-edge use of the technology is
being realised day by day.
Companies must use the benefits technology
offers to reach out to more people "and provide a
facility for them to insure." Digital can be used to
iden�fy the un-insured and bring them on board.
"I think this would be the immediate sudden
expansion in the insurance sphere in our life
today," he concluded.
l Mr K G Krishnamoorthy Rao, Managing
Director and Chief Execu�ve Officer, Future
Generali India Insurance Co Ltd.
Mr Mehrotra suggested that "digital is at �mes a
hackneyed word," and asked how it could
transform the non-life sector.
Mr Krishnamoorthy's response was that 70% of
people are uninsured. This figure could be much
higher in the rural areas or �er four ci�es. "Why
are they uninsured?" he asked. "Or even if they
have taken first �me insurance why are they not
renewing it?" In his view, what is important is to
create awareness about the need for insurance.
Digital can be used as a medium to create that
awareness. Speaking specifically about the non-
life industry, most of the �me the business does
not have full details about the customer. Digital
can help in segmenta�on and requirement
analysis on the customer.
About the top priority areas where digital can
impact non-life insurers across the value chain,
Mr Krishnamoorthy felt that they can capture
value from data and analy�cs in customer
segmenta�on. That will help them decide which
segments they want to target with specific
products. The second area is claims. Products like
motor and health insurance have a high
frequency of claims. "There will be many data
points which can throw specific customer
behaviours based on which you can decide how to
price a typical segment of customer." Possibly in
future, each customer can have a unique
premium rate. Value addi�ons can be considered
for customers who are profitable. Such ini�a�ves
can influence customer behaviour and persuade
them to con�nue renewing.
Speaking about collabora�ng with partners, he
felt that it is possible to collaborate with those
who have informa�on on the customer and a
pla�orm to connect with the customer, such as
telecom companies. Simple product offerings
through such pla�orms can be worked out. He
also suggested that a customer's credit score can
be used because there is a correla�on between
the claims experience of the customer and his
credit score. Credit scores can be a good indicator
FINCON 2017: Conference Proceedings 25
of fraudulent behaviour. This informa�on can be
used for successful underwri�ng on some
products like motor insurance.
l Mr Vighnesh Shahane, Chief Execu�ve
Officer & Whole Time Director, IDBI Federal
Life Insurance Co Ltd.
Mr Shahane discussed the role of digital from a
life insurance, bancassurance and agency channel
perspec�ve.
“Being a bank-led insurance company is
advantageous and disadvantageous," he said,
since 80% of the business comes from people
who have forged a long-term rela�onship with
the bank. This rela�onship cannot be jeopardised
by pushing one product. "We have to be very
conscious of customer dissonance and customer
service.”
In his opinion, the biggest challenge facing the
insurance industry is not financial growth or
market share, but wooing back the customer. "If
the customer doesn't trust you, you won't do
business." He felt that digital will play an
important role, especially in bancassurance, in
enhanc ing and e leva�ng the customer
experience. That is why his company has
a�empted to digi�se every customer touch point.
The other use of digital is in analy�cs. It can
provide historical trends to spot fraudulent
claims; gauge the propensity to buy, up-sell or
cross-sell another product to the bank customer;
and then reach out to them. He described how his
company uses digitalisa�on tablets which
decrease turnaround �me to give the customer
an elevated experience.
But he felt that as far as agency is concerned, they
are s�ll grappling with rudimentary issues. "We
are a li�le way from digitalisa�on of agencies," he
said. The focus is s�ll on recrui�ng the right
person, keeping books, ensuring the right sale
and improving persistency. Digital can help in all
of these, but that may happen in the future.
Responding to a query on how they measure the
return on some of their digital investments, he
said that there are tangible benefits that can be
measured, and also intangible benefits. The
measurable benefits are increase in produc�vity,
sales and spo�ng of fraudulent claims; and the
greatest intangible benefit that cannot be
measured is the elevated customer experience.
Investment in digitalisa�on is necessary also for
the intangible benefits. They cannot be ignored.
Asked about how the industry can maximise the
value that technology offers, Mr Shahane
iden�fied three ways:
(i) Speed is of the essence, because the
adop�on curve is shrinking.
(ii) Cyber security is very important, because
digital technology is vulnerable to real
threats.
(iii) One should never ignore the 'people' side of
technology. If the organisa�on is not aligned
to the new digital strategy, it will not be
successful.
Since life insurance is all about securing monies,
FINCON 2017: Conference Proceedings 24
combined ra�o is a big challenge for non-life
players, whether in the public or private sector in
India. The technology can be used to understand
the profitability of segments, the products within
the segments, and the distribu�on channels. It
can also provide a predic�ve mechanism for the
future, which can help the company add
products, see the trends and tweak the pricing.
Fraud analysis is now ge�ng increased priority
among general insurance players, because "if we
can reduce even five per cent of that, it will
translate into huge sums and show a direct impact
on the combined ra�o.”
Using advanced analy�cs calls for sound decision
making, he observed. It will require online
portals, access, mobility solu�ons, data
warehousing and grievance mechanisms. The
company has to take a call on the ROI, whether it
is worth the investment or can they manage with
the basic analy�cs that comes with exis�ng
so�ware packages. There is also the issue of the
technology ge�ng outdated quickly. That could
lead to the en�re investment being lost. Hence
the need for cu�ng-edge use of the technology is
being realised day by day.
Companies must use the benefits technology
offers to reach out to more people "and provide a
facility for them to insure." Digital can be used to
iden�fy the un-insured and bring them on board.
"I think this would be the immediate sudden
expansion in the insurance sphere in our life
today," he concluded.
l Mr K G Krishnamoorthy Rao, Managing
Director and Chief Execu�ve Officer, Future
Generali India Insurance Co Ltd.
Mr Mehrotra suggested that "digital is at �mes a
hackneyed word," and asked how it could
transform the non-life sector.
Mr Krishnamoorthy's response was that 70% of
people are uninsured. This figure could be much
higher in the rural areas or �er four ci�es. "Why
are they uninsured?" he asked. "Or even if they
have taken first �me insurance why are they not
renewing it?" In his view, what is important is to
create awareness about the need for insurance.
Digital can be used as a medium to create that
awareness. Speaking specifically about the non-
life industry, most of the �me the business does
not have full details about the customer. Digital
can help in segmenta�on and requirement
analysis on the customer.
About the top priority areas where digital can
impact non-life insurers across the value chain,
Mr Krishnamoorthy felt that they can capture
value from data and analy�cs in customer
segmenta�on. That will help them decide which
segments they want to target with specific
products. The second area is claims. Products like
motor and health insurance have a high
frequency of claims. "There will be many data
points which can throw specific customer
behaviours based on which you can decide how to
price a typical segment of customer." Possibly in
future, each customer can have a unique
premium rate. Value addi�ons can be considered
for customers who are profitable. Such ini�a�ves
can influence customer behaviour and persuade
them to con�nue renewing.
Speaking about collabora�ng with partners, he
felt that it is possible to collaborate with those
who have informa�on on the customer and a
pla�orm to connect with the customer, such as
telecom companies. Simple product offerings
through such pla�orms can be worked out. He
also suggested that a customer's credit score can
be used because there is a correla�on between
the claims experience of the customer and his
credit score. Credit scores can be a good indicator
FINCON 2017: Conference Proceedings 25
of fraudulent behaviour. This informa�on can be
used for successful underwri�ng on some
products like motor insurance.
l Mr Vighnesh Shahane, Chief Execu�ve
Officer & Whole Time Director, IDBI Federal
Life Insurance Co Ltd.
Mr Shahane discussed the role of digital from a
life insurance, bancassurance and agency channel
perspec�ve.
“Being a bank-led insurance company is
advantageous and disadvantageous," he said,
since 80% of the business comes from people
who have forged a long-term rela�onship with
the bank. This rela�onship cannot be jeopardised
by pushing one product. "We have to be very
conscious of customer dissonance and customer
service.”
In his opinion, the biggest challenge facing the
insurance industry is not financial growth or
market share, but wooing back the customer. "If
the customer doesn't trust you, you won't do
business." He felt that digital will play an
important role, especially in bancassurance, in
enhanc ing and e leva�ng the customer
experience. That is why his company has
a�empted to digi�se every customer touch point.
The other use of digital is in analy�cs. It can
provide historical trends to spot fraudulent
claims; gauge the propensity to buy, up-sell or
cross-sell another product to the bank customer;
and then reach out to them. He described how his
company uses digitalisa�on tablets which
decrease turnaround �me to give the customer
an elevated experience.
But he felt that as far as agency is concerned, they
are s�ll grappling with rudimentary issues. "We
are a li�le way from digitalisa�on of agencies," he
said. The focus is s�ll on recrui�ng the right
person, keeping books, ensuring the right sale
and improving persistency. Digital can help in all
of these, but that may happen in the future.
Responding to a query on how they measure the
return on some of their digital investments, he
said that there are tangible benefits that can be
measured, and also intangible benefits. The
measurable benefits are increase in produc�vity,
sales and spo�ng of fraudulent claims; and the
greatest intangible benefit that cannot be
measured is the elevated customer experience.
Investment in digitalisa�on is necessary also for
the intangible benefits. They cannot be ignored.
Asked about how the industry can maximise the
value that technology offers, Mr Shahane
iden�fied three ways:
(i) Speed is of the essence, because the
adop�on curve is shrinking.
(ii) Cyber security is very important, because
digital technology is vulnerable to real
threats.
(iii) One should never ignore the 'people' side of
technology. If the organisa�on is not aligned
to the new digital strategy, it will not be
successful.
Since life insurance is all about securing monies,
FINCON 2017: Conference Proceedings 26
risk must be appropriately and efficiently priced.
Data forms the bedrock of the process. Data may
be available in plenty, but it is all in mul�ple
formats. The big challenge for companies is how
to deal with all this data systema�cally.
l Mr Munish Sharda, Managing Director and
Chief Execu�ve Officer, Future Generali
India Life Insurance Co Ltd.
Mr Mehrotra was interested in hearing
Mr Sharda's viewpoint on how insurers concep-
tualise digital and actually execute their plans on
the ground.
Mr Sharda had a slightly different perspec�ve on
digital. His view was that digital is about removing
complexity out of the transac�ons. It should
simplify the customer's understanding of the
product; the benefit he gets out of it; and his
interac�on with the company. If the complexity is
removed, digital can go deep into the organisa-
�on.
The other point Mr Sharda made was how digital
is perceived. It is usually seen as some people in a
corner doing some analy�cs and churning out
models. Digital must be integrated into the en�re
organisa�on. "Unless you are able to put it out to
that employee so that he can make decisions
when he is engaging with the customer, it really
doesn't make a difference to the organisa�on." It
will con�nue to remain in a corner and not create
sustainable value for the organisa�on.
According to him, digital will help in reducing the
risks from the en�re business. But for the digital
agenda to become an agenda of the organisa�on,
it has to be made so simple that the people who
are delivering to the client or doing transac�ons
should find their job made easier by digital.
Digital can sharpen focus and reduce complexity,
especially in future retail. He gave the example of
the Big Bazaar customer. Analy�cs can iden�fy
someone buying kids' garments and the company
should be able to pitch a child plan to that
customer. Digital will help in determining the right
�me to go to the customer and sell the right �cket
on the basis of the Big Bazaar experience. The
poten�al of digital is huge, but it has to be made
to work in a manner that people are able to use it
and make it part of their life.
About how to quan�fy the gain that digital brings,
he said the technology spend must deliver
mul�ple things. It has to take the transac�on cost
out. If the organisa�on has a tab-based app
process where the front-end salesperson is able
to key in the transac�on and do all the analyses,
then the transac�on cost of all the others involved
in the process can be eliminated. Similarly
revenues can be increased by driving sales. Digital
is also useful in customer servicing. If a customer
is doing a number of transac�ons, and a number
of those can be shi�ed to self-service transac�ons
that the customer can do on his own, that has a
clear expense footprint. The expense of people
keying in those transac�ons will be avoided. He
further added that while digital can reduce the
complexity of the lives of those who are doing the
transac�ons, many �mes it is difficult to calculate
or es�mate the benefit of such a move. Drawing
on his experience of the past few decades, he
h owever o bser ved , "wh en ever yo u d o
something, you actually get more than what you
think.”
Speaking about partnerships with other players
outside the financial services ecosystem, Mr
Sharda felt that a lot can be done. "We are part of
an ecosystem which has a lot of this data
available," he said, referring again to Big Bazaar
data. Currently the challenge is to make sense of
the data and make the offering as simple as
possible for the customer. That is impera�ve for
FINCON 2017: Conference Proceedings 27
success, he felt. Earlier, one of the difficul�es the
financial services industry faced was that they
never knew the iden�ty of the person they were
talking to. But with Aadhar and similar
iden�fica�on systems falling in place, the risk
dimension is changing very fast; that makes it
easier for companies to connect with non-
associated pla�orms and make an offer.
He also disclosed that they are inves�ga�ng the
science about the human brain, to be able to
influence customers in a par�cular direc�on. Pilot
tests are being conducted on how, if a customer is
engaging with one pla�orm, to do something that
nudges him to think about insurance. The field is
open, and the poten�al is immense.
l Mr Sa�sh Pillai, Managing Director and
Chief Execu�ve Officer, TransUnion CIBIL
Mr Mehrotra wondered what opportuni�es
Mr Pillai saw for organisa�ons like his to partner
with insurers, and how those partnerships could
be made more conducive from a regulatory
perspec�ve.
Mr Pillai's observa�on was that there is
informa�on asymmetry in terms of data as well as
technology. Technology may be perceived as a
"cool tool," but "if it doesn't make life easier, then
it's actually just a novelty, it's not innova�on."
This is the obstacle they are trying to overcome.
Digital should be able to make a transac�on easy
for a consumer. And, he explained, people will see
something as 'easy' if they don't have the "onus of
proving a lot of different things.”
For an informa�on company, digital can provide
informa�on about the different life stage events
of a consumer. For example, it can reveal whether
he is looking for a loan, and recount his previous
borrowing history. That informa�on can be used
effec�vely to create an accurate profile of the
customer. "Can we fit in pieces of the puzzle of the
consumer that at this point are unknown?" Mr
Pillai believed that the credit and non-credit
informa�on of the consumer that is available
today can solve many problems to get them closer
to removing the asymmetry of informa�on. And
that can solve the fundamental issue of
understanding the consumer.
Mr Pillai was asked that if data is being widely
created within the digital ecosystem, how can
data privacy be managed, while simultaneously
op�mising the mul�ple sources through which it
is being created to maximise its value within the
ecosystem.
His answer was that with the India stack and
commodi�sed APIs, availability of data in secure
formats is a given. That is where the ecosystem is
moving towards. He strongly believed that India
will be way ahead in how pieces of informa�on
are made available; if it is consent-based, the
privacy will be taken care of by the en�ty that is
leading it. But while he was not too concerned
about privacy, he felt that data security is a
concern.
With mul�ple sources of data, the key challenge is
how it will be consumed. With so much data
available, there is a need to have a process and
solu�ons in place so that it is u�lised in a way that
"it doesn't become worse for you." Too much data
can give informa�on, but can also slow things
down. The so�ware should be able to talk to
mul�ple data sources, be agnos�c to companies,
and synthesise the informa�on for the decision
maker in "four metrics rather than twenty five
pages.”
Finally, he said, "we shouldn't be talking about
data; we should talk about data consump�on.”
FINCON 2017: Conference Proceedings 26
risk must be appropriately and efficiently priced.
Data forms the bedrock of the process. Data may
be available in plenty, but it is all in mul�ple
formats. The big challenge for companies is how
to deal with all this data systema�cally.
l Mr Munish Sharda, Managing Director and
Chief Execu�ve Officer, Future Generali
India Life Insurance Co Ltd.
Mr Mehrotra was interested in hearing
Mr Sharda's viewpoint on how insurers concep-
tualise digital and actually execute their plans on
the ground.
Mr Sharda had a slightly different perspec�ve on
digital. His view was that digital is about removing
complexity out of the transac�ons. It should
simplify the customer's understanding of the
product; the benefit he gets out of it; and his
interac�on with the company. If the complexity is
removed, digital can go deep into the organisa-
�on.
The other point Mr Sharda made was how digital
is perceived. It is usually seen as some people in a
corner doing some analy�cs and churning out
models. Digital must be integrated into the en�re
organisa�on. "Unless you are able to put it out to
that employee so that he can make decisions
when he is engaging with the customer, it really
doesn't make a difference to the organisa�on." It
will con�nue to remain in a corner and not create
sustainable value for the organisa�on.
According to him, digital will help in reducing the
risks from the en�re business. But for the digital
agenda to become an agenda of the organisa�on,
it has to be made so simple that the people who
are delivering to the client or doing transac�ons
should find their job made easier by digital.
Digital can sharpen focus and reduce complexity,
especially in future retail. He gave the example of
the Big Bazaar customer. Analy�cs can iden�fy
someone buying kids' garments and the company
should be able to pitch a child plan to that
customer. Digital will help in determining the right
�me to go to the customer and sell the right �cket
on the basis of the Big Bazaar experience. The
poten�al of digital is huge, but it has to be made
to work in a manner that people are able to use it
and make it part of their life.
About how to quan�fy the gain that digital brings,
he said the technology spend must deliver
mul�ple things. It has to take the transac�on cost
out. If the organisa�on has a tab-based app
process where the front-end salesperson is able
to key in the transac�on and do all the analyses,
then the transac�on cost of all the others involved
in the process can be eliminated. Similarly
revenues can be increased by driving sales. Digital
is also useful in customer servicing. If a customer
is doing a number of transac�ons, and a number
of those can be shi�ed to self-service transac�ons
that the customer can do on his own, that has a
clear expense footprint. The expense of people
keying in those transac�ons will be avoided. He
further added that while digital can reduce the
complexity of the lives of those who are doing the
transac�ons, many �mes it is difficult to calculate
or es�mate the benefit of such a move. Drawing
on his experience of the past few decades, he
h owever o bser ved , "wh en ever yo u d o
something, you actually get more than what you
think.”
Speaking about partnerships with other players
outside the financial services ecosystem, Mr
Sharda felt that a lot can be done. "We are part of
an ecosystem which has a lot of this data
available," he said, referring again to Big Bazaar
data. Currently the challenge is to make sense of
the data and make the offering as simple as
possible for the customer. That is impera�ve for
FINCON 2017: Conference Proceedings 27
success, he felt. Earlier, one of the difficul�es the
financial services industry faced was that they
never knew the iden�ty of the person they were
talking to. But with Aadhar and similar
iden�fica�on systems falling in place, the risk
dimension is changing very fast; that makes it
easier for companies to connect with non-
associated pla�orms and make an offer.
He also disclosed that they are inves�ga�ng the
science about the human brain, to be able to
influence customers in a par�cular direc�on. Pilot
tests are being conducted on how, if a customer is
engaging with one pla�orm, to do something that
nudges him to think about insurance. The field is
open, and the poten�al is immense.
l Mr Sa�sh Pillai, Managing Director and
Chief Execu�ve Officer, TransUnion CIBIL
Mr Mehrotra wondered what opportuni�es
Mr Pillai saw for organisa�ons like his to partner
with insurers, and how those partnerships could
be made more conducive from a regulatory
perspec�ve.
Mr Pillai's observa�on was that there is
informa�on asymmetry in terms of data as well as
technology. Technology may be perceived as a
"cool tool," but "if it doesn't make life easier, then
it's actually just a novelty, it's not innova�on."
This is the obstacle they are trying to overcome.
Digital should be able to make a transac�on easy
for a consumer. And, he explained, people will see
something as 'easy' if they don't have the "onus of
proving a lot of different things.”
For an informa�on company, digital can provide
informa�on about the different life stage events
of a consumer. For example, it can reveal whether
he is looking for a loan, and recount his previous
borrowing history. That informa�on can be used
effec�vely to create an accurate profile of the
customer. "Can we fit in pieces of the puzzle of the
consumer that at this point are unknown?" Mr
Pillai believed that the credit and non-credit
informa�on of the consumer that is available
today can solve many problems to get them closer
to removing the asymmetry of informa�on. And
that can solve the fundamental issue of
understanding the consumer.
Mr Pillai was asked that if data is being widely
created within the digital ecosystem, how can
data privacy be managed, while simultaneously
op�mising the mul�ple sources through which it
is being created to maximise its value within the
ecosystem.
His answer was that with the India stack and
commodi�sed APIs, availability of data in secure
formats is a given. That is where the ecosystem is
moving towards. He strongly believed that India
will be way ahead in how pieces of informa�on
are made available; if it is consent-based, the
privacy will be taken care of by the en�ty that is
leading it. But while he was not too concerned
about privacy, he felt that data security is a
concern.
With mul�ple sources of data, the key challenge is
how it will be consumed. With so much data
available, there is a need to have a process and
solu�ons in place so that it is u�lised in a way that
"it doesn't become worse for you." Too much data
can give informa�on, but can also slow things
down. The so�ware should be able to talk to
mul�ple data sources, be agnos�c to companies,
and synthesise the informa�on for the decision
maker in "four metrics rather than twenty five
pages.”
Finally, he said, "we shouldn't be talking about
data; we should talk about data consump�on.”
FINCON 2017: Conference Proceedings 28
l Discussion:
A delegate present in the session shared his
observa�on that the data which is analysed by
companies are about 15 years old, and several
errors have been there in the analysis, leading to
dismal por�olio deple�on. The en�re industry
needs to be examined so that correc�ve
measures can be taken. He wanted to know if
there is any one umbrella body that can analyse
the data for the industry and share it with the
players.
In response to this, Mr Krishnamoorthy informed
that discussions are on at the Council level to
consolidate the en�re data of the industry at one
point. Insurance Informa�on Bureau is collec�ng
the en�re data, analysing it, informing the public
and also informing the regulator in case any
regulatory interven�on is required. They work on
masked, generic data, so as not to face the issue of
data privacy.
Mr Shahane agreed that it is similar for the life
insurance industry. There are service providers
that have data of various types of companies; a lot
of life insurance companies have started tying up
with these service providers. A start has been
made to use the data to detect fraudulent early
claims. But it is just a ma�er of �me before other
facets of the business begin to u�lise this data
effec�vely.
Another member of the audience asked
Mr Sanath Kumar what he felt about strategic
data partnerships . Would h is company
contemplate tying up with somebody like Ola or
Uber and move towards the autonomous route?
And is there a likelihood of the model of motor
insurance moving from 'pay as you go' to 'pay how
you drive' or 'pay how you maintain the car'?
Mr Sanath Kumar's response was that in India, a
car is typically driven by mul�ple persons.
Telema�cs should be able to read and rate the
driving habits of every par�cular driver, so
individualis�c driving pa�erns are needed.
Pricing will need to be done according to that
informa�on. This is a challenge and has not really
taken off in India as of now. The use of telema�cs
in Indian insurance has just started.
Mr Shahane was asked for his opinion on the
scope of wearable devices, and the possibility of
customers insuring themselves through a self-
insurance port. His response was that his
company sponsors four marathons in four
markets; the next step is to explore whether they
can provide wearable devices to the runners. The
informa�on provided by the device can assist
them in relaxing their products or relaxing the
underwri�ng, and in customising their offerings
effec�vely. But that is a step in the future.
Mr Mehrotra thanked the panellists and the
audience and brought the session to a close.
FINCON 2017: Conference Proceedings 29
SESSION IIIDisrup�ve Force of InsurTech
Session moderated by Mr Amit Kumar, Partner
and Director, The Boston Consul�ng Group.
Panellists:
l Ms R M Vishakha, Managing Director and
Chief Execu�ve Officer, India First Life
Insurance Co Ltd.
l Mr Mayank Bathwal, Chief Execu�ve
Officer, Aditya Birla Health Insurance Co Ltd.
l Mr Ja�n Singh, Chief Execu�ve Officer,
Skymet Weather Services Pvt. Ltd.
l Mr Milan Sharma, Chief Execu�ve Officer,
Intello Labs.
l Ms Meena Ganesh, Managing Director and
Chief Execu�ve Officer, Portea Medical.
Overview by Mr Amit Kumar:
Mr Amit Kumar began by saying that insurtechs
are ge�ng a lot of coverage both globally and in
India. It's important to ask why these en��es are
needed. "What is the role that they will come to
play in the industry?" he asked. He iden�fied two
massive trends that are giving insurtechs the
currency to become viable businesses:
(i) The industry has a reputa�on of not being
very customer friendly. That creates an
appe�te for consumers to try different
things.
(ii) Digital technologies are beginning to
mature.
Globally, net promoter score is a measure of
loyalty; companies like Amazon and Apple, that
FINCON 2017: Conference Proceedings 28
l Discussion:
A delegate present in the session shared his
observa�on that the data which is analysed by
companies are about 15 years old, and several
errors have been there in the analysis, leading to
dismal por�olio deple�on. The en�re industry
needs to be examined so that correc�ve
measures can be taken. He wanted to know if
there is any one umbrella body that can analyse
the data for the industry and share it with the
players.
In response to this, Mr Krishnamoorthy informed
that discussions are on at the Council level to
consolidate the en�re data of the industry at one
point. Insurance Informa�on Bureau is collec�ng
the en�re data, analysing it, informing the public
and also informing the regulator in case any
regulatory interven�on is required. They work on
masked, generic data, so as not to face the issue of
data privacy.
Mr Shahane agreed that it is similar for the life
insurance industry. There are service providers
that have data of various types of companies; a lot
of life insurance companies have started tying up
with these service providers. A start has been
made to use the data to detect fraudulent early
claims. But it is just a ma�er of �me before other
facets of the business begin to u�lise this data
effec�vely.
Another member of the audience asked
Mr Sanath Kumar what he felt about strategic
data partnerships . Would h is company
contemplate tying up with somebody like Ola or
Uber and move towards the autonomous route?
And is there a likelihood of the model of motor
insurance moving from 'pay as you go' to 'pay how
you drive' or 'pay how you maintain the car'?
Mr Sanath Kumar's response was that in India, a
car is typically driven by mul�ple persons.
Telema�cs should be able to read and rate the
driving habits of every par�cular driver, so
individualis�c driving pa�erns are needed.
Pricing will need to be done according to that
informa�on. This is a challenge and has not really
taken off in India as of now. The use of telema�cs
in Indian insurance has just started.
Mr Shahane was asked for his opinion on the
scope of wearable devices, and the possibility of
customers insuring themselves through a self-
insurance port. His response was that his
company sponsors four marathons in four
markets; the next step is to explore whether they
can provide wearable devices to the runners. The
informa�on provided by the device can assist
them in relaxing their products or relaxing the
underwri�ng, and in customising their offerings
effec�vely. But that is a step in the future.
Mr Mehrotra thanked the panellists and the
audience and brought the session to a close.
FINCON 2017: Conference Proceedings 29
SESSION IIIDisrup�ve Force of InsurTech
Session moderated by Mr Amit Kumar, Partner
and Director, The Boston Consul�ng Group.
Panellists:
l Ms R M Vishakha, Managing Director and
Chief Execu�ve Officer, India First Life
Insurance Co Ltd.
l Mr Mayank Bathwal, Chief Execu�ve
Officer, Aditya Birla Health Insurance Co Ltd.
l Mr Ja�n Singh, Chief Execu�ve Officer,
Skymet Weather Services Pvt. Ltd.
l Mr Milan Sharma, Chief Execu�ve Officer,
Intello Labs.
l Ms Meena Ganesh, Managing Director and
Chief Execu�ve Officer, Portea Medical.
Overview by Mr Amit Kumar:
Mr Amit Kumar began by saying that insurtechs
are ge�ng a lot of coverage both globally and in
India. It's important to ask why these en��es are
needed. "What is the role that they will come to
play in the industry?" he asked. He iden�fied two
massive trends that are giving insurtechs the
currency to become viable businesses:
(i) The industry has a reputa�on of not being
very customer friendly. That creates an
appe�te for consumers to try different
things.
(ii) Digital technologies are beginning to
mature.
Globally, net promoter score is a measure of
loyalty; companies like Amazon and Apple, that
FINCON 2017: Conference Proceedings 30
have very loyal customers, typically enjoy net
promoter scores of 50 and above. In comparison,
the global insurance industry has a net promoter
score of -12. Across a number of countries,
consumers rou�nely complain about the kind of
experience that they get from insurance
companies. At the same �me there are lots of
developments taking place in the digital world.
Digital is beginning to have a significant influence
on the overall purchase cycle. Data shows that
customers with an income over Rs 7.2 lakh will
rarely buy a policy without spending �me online
in making the decision.
These two trends are giving rise to insurtechs
which are capitalising on these opportuni�es and
are trying to create something that can help the
industry. Last year alone they received funding of
more than $ 3 billion. They are doing a massive
amount of ac�vity to provide an alterna�ve to
consumers and at the same �me capitalise on
what is happening in the technology space.
Globally, this is impac�ng the industry in the
following ways:
(i) There are companies which were born in
the digital world. They are completely
digital, and are beginning to become quite
sizeable as insurance companies. An
example of such a company is Oscar in the
health insurance space, providing end to
end solu�ons. These companies are likely to
become a material part of the industry and
take share away from the incumbents.
(ii) The industry is witnessing a change from
annual policies to specific-event policies.
Companies like Metro Mile can provide
insurance for a single trip, say from Mumbai
to Pune.
(iii) Preven�on-related ac�vi�es are now
becoming popular. Companies like Vitality
will track whatever is going on with the
customer's health; will offer advice and,
where regula�on allows, will provide a
health cover based on the habits of the
customer. When preven�on goes up, the
premiums come down; but that also opens
up an opportunity for the industry to start
crea�ng new revenue streams through new
services.
(iv) The fourth trend is around the robo�cs and
ar�ficial intelligence which can be used for
customer service and also for selling. This is
par�cularly useful in the western world
where manpower costs tend to be higher.
There is a trend in many companies to start
deploying AI or robo�cs to try and reduce
the servicing and selling costs.
(v) Companies that are si�ng on massive
proprietary data are beginning to get into
insurance themselves or get acquired by
insurance companies. As an example,
Climate Corpora�on, which is part of
Monsanto now, keeps a track of climate data
and will use the informa�on to decide
whether or not a claim needs to be paid.
This is a trend that will play out across
mul�ple categories.
In India, the space that has got the maximum
a�en�on so far is the distribu�on or the
aggregator space. Currently, there is no
standalone digital insurance company in this
space. Part of the reason for that is the
regula�ons and how they are interpreted; but the
companies are also wai�ng and watching to see
how the trends are playing out globally before
deciding to enter this space.
A number of companies are playing an enabler
role. They don't sell policies themselves, but they
help the insurance companies. There are three
types of such companies:
FINCON 2017: Conference Proceedings 31
(i) Companies that provide services, such as
Portea and Skymet.
(ii) Companies using big data and analy�cs.
Insurance is a very data intensive business
and access to proprietary data gives a
company an advantage.
(iii) Companies that are deploying the new
technology at the back end to make the
processes more efficient.
Mr Amit Kumar described how he felt insurance
companies and insurtechs can work together.
There are broadly three models:
(i) The vendor model, when companies come
together for a specific period of �me or for a
specific ac�vity and disperse a�er rendering
the specific service.
(ii) Partnerships, when the CEOs of both par�es
get together and discuss how to work
together on an ongoing basis through
strategic partnerships and �e-ups. Vitality is
a good example of this in the health
insurance space. They have created very
deep partnerships to keep track of what
people are doing and do be�er pricing and
claims management.
(iii) Companies that are actually deploying
significant stakes to invest in or create
insurtechs.
Mr Amit Kumar set the tone for the discussion.
Since the panel had insurtechs and insurance
company CEOs, he highlighted two ques�ons: (a)
how can insurtechs scale up, and integrate well
with insurance companies; and (b) from the
insurtech perspec�ve, how can they be�er
partner insurance companies.
Panellists' Views:
l Ms Meena Ganesh, Managing Director and
Chief Execu�ve Officer, Portea Medical
Ms Ganesh gave a brief introduc�on of her
company. Portea Medical is building, she said,
consumer-centric healthcare. Their objec�ve is to
see what healthcare services their customers
need, how they can be in charge of their own
healthcare, make be�er decisions and get be�er
outcomes. "The main focus for us has been the
outside-of-hospital healthcare spend," she said.
She explained that of the $ 100 billion that gets
spent on healthcare, half of it is spent outside the
hospital. And what everybody focuses on is the
amount spent in the hospital. Huge efforts are
made to improve in-hospital healthcare. But the
balance, which is outside of the hospital is
disjointed, unorganised and of poor quality.
"That's the piece which needs a lot more of
investment and focus.”
Portea Medical, said Ms Ganesh, provides a
number of different services which can be
classified into three or four categories:
(i) Home care: this may be of help for
somebody who is discharged from hospital.
(ii) Longitudinal management of the healthcare
needs of an elderly family member.
(iii) Chronic disease management including
mental and physical wellness; and
(iv) Equipment, diagnos�cs and pharmacy.
Predominantly everything that Portea does is
built on a layer of technology. That is why they are
posi�oned as a part of Insurtech finance. "But
that's not all we are," she said. "The technology is
the underlying backbone which helps us provide a
number of services to the customers, giving them
the power to manage their health." She explained
that there is technology at the customer end and
at the clinician end. The data about the pa�ent's
health is uploaded on to the Cloud and is then
monitored by the clinicians.
FINCON 2017: Conference Proceedings 30
have very loyal customers, typically enjoy net
promoter scores of 50 and above. In comparison,
the global insurance industry has a net promoter
score of -12. Across a number of countries,
consumers rou�nely complain about the kind of
experience that they get from insurance
companies. At the same �me there are lots of
developments taking place in the digital world.
Digital is beginning to have a significant influence
on the overall purchase cycle. Data shows that
customers with an income over Rs 7.2 lakh will
rarely buy a policy without spending �me online
in making the decision.
These two trends are giving rise to insurtechs
which are capitalising on these opportuni�es and
are trying to create something that can help the
industry. Last year alone they received funding of
more than $ 3 billion. They are doing a massive
amount of ac�vity to provide an alterna�ve to
consumers and at the same �me capitalise on
what is happening in the technology space.
Globally, this is impac�ng the industry in the
following ways:
(i) There are companies which were born in
the digital world. They are completely
digital, and are beginning to become quite
sizeable as insurance companies. An
example of such a company is Oscar in the
health insurance space, providing end to
end solu�ons. These companies are likely to
become a material part of the industry and
take share away from the incumbents.
(ii) The industry is witnessing a change from
annual policies to specific-event policies.
Companies like Metro Mile can provide
insurance for a single trip, say from Mumbai
to Pune.
(iii) Preven�on-related ac�vi�es are now
becoming popular. Companies like Vitality
will track whatever is going on with the
customer's health; will offer advice and,
where regula�on allows, will provide a
health cover based on the habits of the
customer. When preven�on goes up, the
premiums come down; but that also opens
up an opportunity for the industry to start
crea�ng new revenue streams through new
services.
(iv) The fourth trend is around the robo�cs and
ar�ficial intelligence which can be used for
customer service and also for selling. This is
par�cularly useful in the western world
where manpower costs tend to be higher.
There is a trend in many companies to start
deploying AI or robo�cs to try and reduce
the servicing and selling costs.
(v) Companies that are si�ng on massive
proprietary data are beginning to get into
insurance themselves or get acquired by
insurance companies. As an example,
Climate Corpora�on, which is part of
Monsanto now, keeps a track of climate data
and will use the informa�on to decide
whether or not a claim needs to be paid.
This is a trend that will play out across
mul�ple categories.
In India, the space that has got the maximum
a�en�on so far is the distribu�on or the
aggregator space. Currently, there is no
standalone digital insurance company in this
space. Part of the reason for that is the
regula�ons and how they are interpreted; but the
companies are also wai�ng and watching to see
how the trends are playing out globally before
deciding to enter this space.
A number of companies are playing an enabler
role. They don't sell policies themselves, but they
help the insurance companies. There are three
types of such companies:
FINCON 2017: Conference Proceedings 31
(i) Companies that provide services, such as
Portea and Skymet.
(ii) Companies using big data and analy�cs.
Insurance is a very data intensive business
and access to proprietary data gives a
company an advantage.
(iii) Companies that are deploying the new
technology at the back end to make the
processes more efficient.
Mr Amit Kumar described how he felt insurance
companies and insurtechs can work together.
There are broadly three models:
(i) The vendor model, when companies come
together for a specific period of �me or for a
specific ac�vity and disperse a�er rendering
the specific service.
(ii) Partnerships, when the CEOs of both par�es
get together and discuss how to work
together on an ongoing basis through
strategic partnerships and �e-ups. Vitality is
a good example of this in the health
insurance space. They have created very
deep partnerships to keep track of what
people are doing and do be�er pricing and
claims management.
(iii) Companies that are actually deploying
significant stakes to invest in or create
insurtechs.
Mr Amit Kumar set the tone for the discussion.
Since the panel had insurtechs and insurance
company CEOs, he highlighted two ques�ons: (a)
how can insurtechs scale up, and integrate well
with insurance companies; and (b) from the
insurtech perspec�ve, how can they be�er
partner insurance companies.
Panellists' Views:
l Ms Meena Ganesh, Managing Director and
Chief Execu�ve Officer, Portea Medical
Ms Ganesh gave a brief introduc�on of her
company. Portea Medical is building, she said,
consumer-centric healthcare. Their objec�ve is to
see what healthcare services their customers
need, how they can be in charge of their own
healthcare, make be�er decisions and get be�er
outcomes. "The main focus for us has been the
outside-of-hospital healthcare spend," she said.
She explained that of the $ 100 billion that gets
spent on healthcare, half of it is spent outside the
hospital. And what everybody focuses on is the
amount spent in the hospital. Huge efforts are
made to improve in-hospital healthcare. But the
balance, which is outside of the hospital is
disjointed, unorganised and of poor quality.
"That's the piece which needs a lot more of
investment and focus.”
Portea Medical, said Ms Ganesh, provides a
number of different services which can be
classified into three or four categories:
(i) Home care: this may be of help for
somebody who is discharged from hospital.
(ii) Longitudinal management of the healthcare
needs of an elderly family member.
(iii) Chronic disease management including
mental and physical wellness; and
(iv) Equipment, diagnos�cs and pharmacy.
Predominantly everything that Portea does is
built on a layer of technology. That is why they are
posi�oned as a part of Insurtech finance. "But
that's not all we are," she said. "The technology is
the underlying backbone which helps us provide a
number of services to the customers, giving them
the power to manage their health." She explained
that there is technology at the customer end and
at the clinician end. The data about the pa�ent's
health is uploaded on to the Cloud and is then
monitored by the clinicians.
FINCON 2017: Conference Proceedings 32
Ms Ganesh felt that there are three key areas that
are relevant for this discussion.
The first is primary and preven�ve care. "In India
that gets a short shri�." Customers typically go
either directly to a specialist or wait �ll things get
out of hand and then go to a hospital. "That's the
worst way of managing primary care because you
are le�ng things get out of hand." How can
primary care be made accessible using
technology as well as services on the ground? "It's
not one or the other, it's always a combina�on,"
she said. Preven�ve care is also very important.
Checkups should be done at the right �me and
not le� to the annual checkup. Intelligence can be
drawn out of the data and the pa�ent provided
with support to ensure that s/he remains within
safe medical limits.
The second is how to use the technology and the
people to manage chronic disease. The two have
to operate together to keep the disease under
check. An example is the connected glucometer
which is then supported at the back-end by a
team. The data is constantly monitored by a team
of physicians, nutri�onists and counsellors who
look at what needs to be done to keep the pa�ent
within normal limits. In the health insurance
space this ensures that pa�ents don't become
more expensive to the overall ecosystem.
The third use case is around post-opera�ve care.
Good hospitals are constantly looking for ways of
reducing the length of stay of pa�ents. And the
best place to recover is really home. How does a
hospital discharge a pa�ent at the right �me and
let him recover at home? Then there are those in
cri�cal care with really no treatment going on.
They can be managed by bringing them home and
crea�ng an ICU-like environment in the familiar
comfort of the home. In both these situa�ons, a
combina�on of technology and services "keeps all
the pieces of the ecosystem logged in so that you
get the best outcome.”
FINCON 2017: Conference Proceedings 33
Ms Ganesh also discussed her experience of
working with insurance companies. She disclosed
that almost 90% of the services they provide are
not covered by insurers, but are paid for by the
consumers themselves. They have recently
started working with some insurance companies,
with the focus on things that can be done either at
a hospital or at home. They make it cheaper and
more convenient for the stakeholders; but what
will really make a difference are the use cases that
are discussed above. "Can we manage a chronic
disease with the help of technology and include
that as a part of how the insurance payouts
happen and how the people are rewarded?" she
asked. Similarly hospitalisa�on packages which
include a combina�on of at-hospital, outside-
hospital with focus on the outcome, will actually
make a real difference to both the insurers and
the consumers. And when it comes to data,
longitudinal data is not available. Companies like
Portea that are focused on the consumer over a
period of years tend to capture a very long cross
sec�on of the customer's health data. "That
might provide another benefit from an
underwri�ng perspec�ve," she said.
l Mr Ja�n Singh, Chief Execu�ve Officer,
Skymet Weather Services Pvt. Ltd.
"I'm like the Portea for agriculture," declared Mr
Singh as he began describing the work of Skymet.
Skymet, he explained, are the biggest data
providers for the Pradhan Mantri Fasal Bima
Yojana; they have about 6000 weather sta�ons
across the country; they have India's first
lightning detec�on network; and they work in
agriculture and help underwriters and claim
se�lements.
They are experts in crop yield forecas�ng; risk
management; crop modelling; remote sensing;
and GIS. Currently they are carrying out a huge
logis�cal exercise to try and ascertain the yield
risk on a per-farmer basis across India. Mr Singh
explained that Skymet's primary objec�ve is,
besides weather forecas�ng, to monitor crops
and assess loss. They also work in the banking
space and help in providing parametric weather
index based insurance as well as the yield based
insurance products. They work across the board
with every reinsurance company in India.
At present, the most important challenge in
agriculture is to drill down to the individual farm.
Skymet is tackling that problem from a data point
of view. Although it is a huge data challenge, they
now have satellite imagery and about 15 military
grade drones with which they are able to match
each and every farmer to each field. This is done
basically through a combina�on of the Internet
and hardwaring. Data can now be sampled at any
temporal or geographical resolu�on, which will
create a whole new risk profile. They can help in
cu�ng down insurance fraud by using UAVs
because farmer declara�ons have never been
cross-checked.
Mr Singh disclosed that reinsurers are showing
great interest in their work. Unfortunately in
agriculture, most of the insurance has been area-
based, while the Government and the companies
are trying to get to the individual farmer. This
brings in a dimension of complexity, because the
individual farmer has to be linked to the land.
"And what do you do when he is a landless
farmer?" That is where a lot of these IoT (Internet
of Things) devices will come into play, he
explained.
Hence he was op�mis�c that agriculture is not
going to be le� out. “There's already a lot of
innova�on that is ge�ng into it and it probably
will be a very fast adopter of IoT.”
When asked about his experience of working with
insurance partners, Mr Singh observed that one
FINCON 2017: Conference Proceedings 32
Ms Ganesh felt that there are three key areas that
are relevant for this discussion.
The first is primary and preven�ve care. "In India
that gets a short shri�." Customers typically go
either directly to a specialist or wait �ll things get
out of hand and then go to a hospital. "That's the
worst way of managing primary care because you
are le�ng things get out of hand." How can
primary care be made accessible using
technology as well as services on the ground? "It's
not one or the other, it's always a combina�on,"
she said. Preven�ve care is also very important.
Checkups should be done at the right �me and
not le� to the annual checkup. Intelligence can be
drawn out of the data and the pa�ent provided
with support to ensure that s/he remains within
safe medical limits.
The second is how to use the technology and the
people to manage chronic disease. The two have
to operate together to keep the disease under
check. An example is the connected glucometer
which is then supported at the back-end by a
team. The data is constantly monitored by a team
of physicians, nutri�onists and counsellors who
look at what needs to be done to keep the pa�ent
within normal limits. In the health insurance
space this ensures that pa�ents don't become
more expensive to the overall ecosystem.
The third use case is around post-opera�ve care.
Good hospitals are constantly looking for ways of
reducing the length of stay of pa�ents. And the
best place to recover is really home. How does a
hospital discharge a pa�ent at the right �me and
let him recover at home? Then there are those in
cri�cal care with really no treatment going on.
They can be managed by bringing them home and
crea�ng an ICU-like environment in the familiar
comfort of the home. In both these situa�ons, a
combina�on of technology and services "keeps all
the pieces of the ecosystem logged in so that you
get the best outcome.”
FINCON 2017: Conference Proceedings 33
Ms Ganesh also discussed her experience of
working with insurance companies. She disclosed
that almost 90% of the services they provide are
not covered by insurers, but are paid for by the
consumers themselves. They have recently
started working with some insurance companies,
with the focus on things that can be done either at
a hospital or at home. They make it cheaper and
more convenient for the stakeholders; but what
will really make a difference are the use cases that
are discussed above. "Can we manage a chronic
disease with the help of technology and include
that as a part of how the insurance payouts
happen and how the people are rewarded?" she
asked. Similarly hospitalisa�on packages which
include a combina�on of at-hospital, outside-
hospital with focus on the outcome, will actually
make a real difference to both the insurers and
the consumers. And when it comes to data,
longitudinal data is not available. Companies like
Portea that are focused on the consumer over a
period of years tend to capture a very long cross
sec�on of the customer's health data. "That
might provide another benefit from an
underwri�ng perspec�ve," she said.
l Mr Ja�n Singh, Chief Execu�ve Officer,
Skymet Weather Services Pvt. Ltd.
"I'm like the Portea for agriculture," declared Mr
Singh as he began describing the work of Skymet.
Skymet, he explained, are the biggest data
providers for the Pradhan Mantri Fasal Bima
Yojana; they have about 6000 weather sta�ons
across the country; they have India's first
lightning detec�on network; and they work in
agriculture and help underwriters and claim
se�lements.
They are experts in crop yield forecas�ng; risk
management; crop modelling; remote sensing;
and GIS. Currently they are carrying out a huge
logis�cal exercise to try and ascertain the yield
risk on a per-farmer basis across India. Mr Singh
explained that Skymet's primary objec�ve is,
besides weather forecas�ng, to monitor crops
and assess loss. They also work in the banking
space and help in providing parametric weather
index based insurance as well as the yield based
insurance products. They work across the board
with every reinsurance company in India.
At present, the most important challenge in
agriculture is to drill down to the individual farm.
Skymet is tackling that problem from a data point
of view. Although it is a huge data challenge, they
now have satellite imagery and about 15 military
grade drones with which they are able to match
each and every farmer to each field. This is done
basically through a combina�on of the Internet
and hardwaring. Data can now be sampled at any
temporal or geographical resolu�on, which will
create a whole new risk profile. They can help in
cu�ng down insurance fraud by using UAVs
because farmer declara�ons have never been
cross-checked.
Mr Singh disclosed that reinsurers are showing
great interest in their work. Unfortunately in
agriculture, most of the insurance has been area-
based, while the Government and the companies
are trying to get to the individual farmer. This
brings in a dimension of complexity, because the
individual farmer has to be linked to the land.
"And what do you do when he is a landless
farmer?" That is where a lot of these IoT (Internet
of Things) devices will come into play, he
explained.
Hence he was op�mis�c that agriculture is not
going to be le� out. “There's already a lot of
innova�on that is ge�ng into it and it probably
will be a very fast adopter of IoT.”
When asked about his experience of working with
insurance partners, Mr Singh observed that one
FINCON 2017: Conference Proceedings 34
thing that will impact everybody is that "today the
Government itself is very innova�on-savvy."
There seems to be a certain amount of pressure,
flowing down from the top, to 'interne�se'
everything. This change is seeping into both local
governance as well as insurance companies. And
as the job of the intermediary in the post Internet
age gets minimised, the gain shi�s to the
reinsurer. If, in the post Internet age, distribu�on
is digital; market acquisi�on is fairly simple;
products are visible; and the bulk of the risk is
taken by the reinsurer, "then what are you
doing?" would be the ques�on which many
insurers will be asked, he predicted.
l Mr Milan Sharma, Chief Execu�ve Officer,
Intello Labs
Mr Sharma introduced Intello Labs is an ar�ficial
intelligence big data company. They operate
primarily in two domains of ar�ficial intelligence:
(i) deep learning and (ii) natural language
processing.
Deep learning is informa�on picked up from
images. It can be used on items such as hand-filled
forms. Such forms contain a lot of informa�on.
When they are processed, that informa�on is
digi�sed. The handwri�ng is 'learned'; and �ck
marks and crosses are deciphered. Neural
networks can be trained to make them smarter. In
this way, the system interprets policies as humans
do.
Natural language processing (NLP) operates in a
manner similar to the human brain, using neural
networks and learning from text and words. The
main applica�on is customer segmenta�on. The
star�ng point is based on publicly available
informa�on. There is a lot of informa�on that can
be picked up from the Internet. The challenge is to
extract the informa�on and make it usable. A lot
of details that are not presented can be imputed
very easily from whatever is publicly available on
the Internet, Mr Sharma disclosed. This social
data enrichment is very powerful to understand
who the customer is.
Mr Sharma also pointed out that as a young
technology company, they struggle with most of
the startup challenges. On the business side, the
biggest challenge is to create use cases of the
technology. The technology that they have built
shows immense poten�al and they are able to
handle petabytes of data using the Cloud.
Since they have built a very good neural network
that behaves like the human brain, the challenge
now is to reach out to real businesses, and adapt
this technology to provide solu�ons and create
business impact. They have been able to do that
successfully; they already have a few insurance
clients and clients across different ver�cals
leveraging their technology. What they give the
client is "processed, relevant informa�on which
can be consumed directly" and is very easy to
integrate.
l Ms R M Vishakha, Managing Director and
Chief Execu�ve Officer, India First Life
Insurance Co Ltd.
Mr Amit Kumar asked Ms Vishakha about her
view on insurtechs, given that IndiaFirst is a
rela�vely new entrant in the industry and
therefore has the benefit of not having too many
legacy systems.
She felt that legacy systems are irrelevant. Every
company should benefit from the opportuni�es
coming up with insurtechs. Life insurance
companies face three challenges: (a) produc�vity
enhancement, (b) cost op�misa�on and (c)
customer reten�on. People have tried to address
these issues through manual efforts; but that
increases the cost. The only way it can be done is
through technology because this helps in bringing
FINCON 2017: Conference Proceedings 35
out a lot of process enhancement without
appropriate cost increase. As an example, with
the digi�sa�on of money, a money transfer can be
made from the customer directly into a
company's account. Companies can therefore
reach the interiors irrespec�ve of bank branches
and people movement.
Ms Vishakha disclosed that she has spent �me
with more than a dozen insurtechs. She finds that
the biggest challenge is that insurtech companies
are technical companies. "Their ability to create a
proposi�on and fill the need of a customer is
actually limited," she said. She touched on sales
management as an example. The biggest
challenge in terms of produc�vity for a sales
manager is to look at the data and ask direct
ques�ons. "Most sales managers are Gabbar
Singhs," she declared jocularly. They'll get into
kitne aadmi the, kitna paisa laya, kitna dhanda
hua?" Beyond that they cannot ask any ques�on.
Whereas, management really needs to ask
intelligent ques�ons about the customer, his
profile, his need, the product that was pitched,
and how and when it was pitched. A sale, she
explained, is not robo�c. A customer will behave
differently based on his moods.
Hence, she felt, at present a sales person's job is
not really in threat. Unless we get into a great
level of NLP (Natural Language Processing), the
personal interface will always be needed to be
able to sell. At present no insurtech so�ware
provides that solu�on. "What is frustra�ng to me
is that we see a lot of development but I don't
think we see solu�ons to the needs," she
revealed.
l Mr Mayank Bathwal, Chief Execu�ve
Officer, Aditya Birla Health Insurance Co Ltd.
Mr Bathwal shared his perspec�ve on insurtechs.
Since these companies are recent entrants in the
insurance space, they had the opportunity to see
what they could do different from the way the
industry has performed so far. Insurance
companies concentrate mainly on acquisi�on of
customers. They iden�fied two areas beyond
that: (a) how to leverage the whole insurtech and
digital opportunity to engage be�er with
customers; and (b) how to use these tools to
enhance consumer experience. "There are
players in this space who can help you do that," he
advised. He shared two examples of what they are
doing today.
When they launched the health insurance
business they realised that they had the
o p p o r t u n i t y to go b eyo n d t h e t y p i ca l
reimbursement of medical expenses that other
insurers were doing. The challenge was to create
a much more engaging rela�onship. They looked
for ways to incen�vise consumers if they took
care of their health, because that would be in the
interest of both the insurance company as well as
the consumer. Today that proposi�on can be
realised because of the power of wearables and
smartphones. So they return 30% of the premium
of those who take care of their health. Using
wearables and smartphones they are able to track
consumers and check out their physical ac�vity.
Consumers simply download their app, connect it
to a wearable device, and can be tracked and
rewarded.
Another example he gave was in submi�ng
hospital isa�on claims. At present when
somebody wants to make a claim, they have to
take a pre-authorisa�on and go through another
process at the �me of discharge. "The whole
process is so archaic and the level of integra�on
between the providers and the payers is very
restricted today." Each insurance company goes
to the hospital separately and asks for their portal
to be integrated with the hospital so�ware. So the
hospital has to integrate with as many payers as
FINCON 2017: Conference Proceedings 34
thing that will impact everybody is that "today the
Government itself is very innova�on-savvy."
There seems to be a certain amount of pressure,
flowing down from the top, to 'interne�se'
everything. This change is seeping into both local
governance as well as insurance companies. And
as the job of the intermediary in the post Internet
age gets minimised, the gain shi�s to the
reinsurer. If, in the post Internet age, distribu�on
is digital; market acquisi�on is fairly simple;
products are visible; and the bulk of the risk is
taken by the reinsurer, "then what are you
doing?" would be the ques�on which many
insurers will be asked, he predicted.
l Mr Milan Sharma, Chief Execu�ve Officer,
Intello Labs
Mr Sharma introduced Intello Labs is an ar�ficial
intelligence big data company. They operate
primarily in two domains of ar�ficial intelligence:
(i) deep learning and (ii) natural language
processing.
Deep learning is informa�on picked up from
images. It can be used on items such as hand-filled
forms. Such forms contain a lot of informa�on.
When they are processed, that informa�on is
digi�sed. The handwri�ng is 'learned'; and �ck
marks and crosses are deciphered. Neural
networks can be trained to make them smarter. In
this way, the system interprets policies as humans
do.
Natural language processing (NLP) operates in a
manner similar to the human brain, using neural
networks and learning from text and words. The
main applica�on is customer segmenta�on. The
star�ng point is based on publicly available
informa�on. There is a lot of informa�on that can
be picked up from the Internet. The challenge is to
extract the informa�on and make it usable. A lot
of details that are not presented can be imputed
very easily from whatever is publicly available on
the Internet, Mr Sharma disclosed. This social
data enrichment is very powerful to understand
who the customer is.
Mr Sharma also pointed out that as a young
technology company, they struggle with most of
the startup challenges. On the business side, the
biggest challenge is to create use cases of the
technology. The technology that they have built
shows immense poten�al and they are able to
handle petabytes of data using the Cloud.
Since they have built a very good neural network
that behaves like the human brain, the challenge
now is to reach out to real businesses, and adapt
this technology to provide solu�ons and create
business impact. They have been able to do that
successfully; they already have a few insurance
clients and clients across different ver�cals
leveraging their technology. What they give the
client is "processed, relevant informa�on which
can be consumed directly" and is very easy to
integrate.
l Ms R M Vishakha, Managing Director and
Chief Execu�ve Officer, India First Life
Insurance Co Ltd.
Mr Amit Kumar asked Ms Vishakha about her
view on insurtechs, given that IndiaFirst is a
rela�vely new entrant in the industry and
therefore has the benefit of not having too many
legacy systems.
She felt that legacy systems are irrelevant. Every
company should benefit from the opportuni�es
coming up with insurtechs. Life insurance
companies face three challenges: (a) produc�vity
enhancement, (b) cost op�misa�on and (c)
customer reten�on. People have tried to address
these issues through manual efforts; but that
increases the cost. The only way it can be done is
through technology because this helps in bringing
FINCON 2017: Conference Proceedings 35
out a lot of process enhancement without
appropriate cost increase. As an example, with
the digi�sa�on of money, a money transfer can be
made from the customer directly into a
company's account. Companies can therefore
reach the interiors irrespec�ve of bank branches
and people movement.
Ms Vishakha disclosed that she has spent �me
with more than a dozen insurtechs. She finds that
the biggest challenge is that insurtech companies
are technical companies. "Their ability to create a
proposi�on and fill the need of a customer is
actually limited," she said. She touched on sales
management as an example. The biggest
challenge in terms of produc�vity for a sales
manager is to look at the data and ask direct
ques�ons. "Most sales managers are Gabbar
Singhs," she declared jocularly. They'll get into
kitne aadmi the, kitna paisa laya, kitna dhanda
hua?" Beyond that they cannot ask any ques�on.
Whereas, management really needs to ask
intelligent ques�ons about the customer, his
profile, his need, the product that was pitched,
and how and when it was pitched. A sale, she
explained, is not robo�c. A customer will behave
differently based on his moods.
Hence, she felt, at present a sales person's job is
not really in threat. Unless we get into a great
level of NLP (Natural Language Processing), the
personal interface will always be needed to be
able to sell. At present no insurtech so�ware
provides that solu�on. "What is frustra�ng to me
is that we see a lot of development but I don't
think we see solu�ons to the needs," she
revealed.
l Mr Mayank Bathwal, Chief Execu�ve
Officer, Aditya Birla Health Insurance Co Ltd.
Mr Bathwal shared his perspec�ve on insurtechs.
Since these companies are recent entrants in the
insurance space, they had the opportunity to see
what they could do different from the way the
industry has performed so far. Insurance
companies concentrate mainly on acquisi�on of
customers. They iden�fied two areas beyond
that: (a) how to leverage the whole insurtech and
digital opportunity to engage be�er with
customers; and (b) how to use these tools to
enhance consumer experience. "There are
players in this space who can help you do that," he
advised. He shared two examples of what they are
doing today.
When they launched the health insurance
business they realised that they had the
o p p o r t u n i t y to go b eyo n d t h e t y p i ca l
reimbursement of medical expenses that other
insurers were doing. The challenge was to create
a much more engaging rela�onship. They looked
for ways to incen�vise consumers if they took
care of their health, because that would be in the
interest of both the insurance company as well as
the consumer. Today that proposi�on can be
realised because of the power of wearables and
smartphones. So they return 30% of the premium
of those who take care of their health. Using
wearables and smartphones they are able to track
consumers and check out their physical ac�vity.
Consumers simply download their app, connect it
to a wearable device, and can be tracked and
rewarded.
Another example he gave was in submi�ng
hospital isa�on claims. At present when
somebody wants to make a claim, they have to
take a pre-authorisa�on and go through another
process at the �me of discharge. "The whole
process is so archaic and the level of integra�on
between the providers and the payers is very
restricted today." Each insurance company goes
to the hospital separately and asks for their portal
to be integrated with the hospital so�ware. So the
hospital has to integrate with as many payers as
FINCON 2017: Conference Proceedings 36
there are. This is highly unwieldy. In more
advanced na�ons, this is done through switches
or exchanges. If payers use such a switch or
exchange to integrate with the providers, the
whole experience of digital informa�on flow from
the provider to the payer can be seamless. If the
industry collaborates in this area, "you can
actually create a much be�er experience for the
customers," he proposed.
He went on to add that some people are doing
very good work on geotagging and geomapping,
helping companies find out where customers are
located, so that it is possible for them to match
the profile of their sales agent to that of the
consumer. He was convinced that the exci�ng
work happening in the healthtech area will lead to
both efficiency in the insurance space and a be�er
consumer experience.
l Discussion:
A delegate wanted to know the following from
Ms Vishakha and Mr Bathwal:
(i) What budget they have allocated to engage
with insurtechs;
(ii) What framework they have built within
their companies to take risks on new
technologies; and
(iii) How they have set up their legal and
financial systems in order to engage with
smaller companies that don't have
substan�al funding.
Ms Vishakha responded to each of his points:
(i) They are seeking solu�ons for the three
main challenges of produc�vity enhance-
ment, cost reduc�on and consumer
reten�on. Any solu�on that can achieve
these objec�ves will always be treated as an
investment. It will never be looked at as an
opera�onal expense.
(ii) Se�ng up the framework to work with
insurtech companies is simple: they do a
pilot. Since insurtech companies may not
understand business problems, the change
management or the opera�ons team within
the organisa�on works with them,
understands the technology and examines
how it can be aligned with the business
problem to develop a solu�on. The solu�on
is developed jointly.
(iii) They have not faced any major issues in
terms of legal or finance. Every �me they
have gone to the regulator with something
that they have felt is good, they have got the
go-ahead to implement it.
Mr Bathwal echoed what Ms Vishakha said.
Budget was not so much of a concern. Referring to
the two examples that he shared earlier, he
pointed out that these are real life issues for them
as a health insurance company and they approach
the solu�on with the convic�on that it just has to
work. In situa�ons where they don't have a very
proven case they may do a pilot, but when it is an
absolute necessity they go ahead and make sure
that it works.
A student of Na�onal Insurance Academy had a
ques�on for Mr Ja�n Singh. Since data collec�on
at the basic level is subject to many errors either
because it is in the local language or because of
errors when entering the data, he wanted to
know how Skymet handles that problem.
Mr Singh responded that when satellite and UAV
is used, there is no interpreta�on issue in acreage
data. For digi�sa�on of cadastral maps they have
a team of about 300 people and a significant
amount of man-hours goes into the process.
Describing the process of ge�ng individual
farmer data, he said it is "literally a census
collec�on, effec�vely we are de facto patwaris
and kanungoes." But there is no other way to do
FINCON 2017: Conference Proceedings 37
it. A lot of the data is now being manually digi�sed
because the available data is very unorganised,
and many big companies outsource that job to
Skymet.
Another member of the audience then asked
Mr Singh whether they are also able to throw
back informa�on to the insurance companies on
actuarial based pricing. Mr Singh responded that
they are a se�lement agency and they have built
so�ware. The data is either sold to the insurance
companies or they can buy the en�re so�ware
suite and use it to price products. They are also
consultants with the state governments, World
Bank and IFC.
A cyber security professional present at the
session suggested that companies should include
the security aspects while developing the
applica�ons because as insurance companies
they hold a lot of personal sensi�ve data. A�er
the Digital India push the laws have become
stringent and there can be huge penal�es and
compensa�ons to be paid out.
With this , Mr Amit Kumar thanked the
par�cipants and brought the session to a close.
FINCON 2017: Conference Proceedings 36
there are. This is highly unwieldy. In more
advanced na�ons, this is done through switches
or exchanges. If payers use such a switch or
exchange to integrate with the providers, the
whole experience of digital informa�on flow from
the provider to the payer can be seamless. If the
industry collaborates in this area, "you can
actually create a much be�er experience for the
customers," he proposed.
He went on to add that some people are doing
very good work on geotagging and geomapping,
helping companies find out where customers are
located, so that it is possible for them to match
the profile of their sales agent to that of the
consumer. He was convinced that the exci�ng
work happening in the healthtech area will lead to
both efficiency in the insurance space and a be�er
consumer experience.
l Discussion:
A delegate wanted to know the following from
Ms Vishakha and Mr Bathwal:
(i) What budget they have allocated to engage
with insurtechs;
(ii) What framework they have built within
their companies to take risks on new
technologies; and
(iii) How they have set up their legal and
financial systems in order to engage with
smaller companies that don't have
substan�al funding.
Ms Vishakha responded to each of his points:
(i) They are seeking solu�ons for the three
main challenges of produc�vity enhance-
ment, cost reduc�on and consumer
reten�on. Any solu�on that can achieve
these objec�ves will always be treated as an
investment. It will never be looked at as an
opera�onal expense.
(ii) Se�ng up the framework to work with
insurtech companies is simple: they do a
pilot. Since insurtech companies may not
understand business problems, the change
management or the opera�ons team within
the organisa�on works with them,
understands the technology and examines
how it can be aligned with the business
problem to develop a solu�on. The solu�on
is developed jointly.
(iii) They have not faced any major issues in
terms of legal or finance. Every �me they
have gone to the regulator with something
that they have felt is good, they have got the
go-ahead to implement it.
Mr Bathwal echoed what Ms Vishakha said.
Budget was not so much of a concern. Referring to
the two examples that he shared earlier, he
pointed out that these are real life issues for them
as a health insurance company and they approach
the solu�on with the convic�on that it just has to
work. In situa�ons where they don't have a very
proven case they may do a pilot, but when it is an
absolute necessity they go ahead and make sure
that it works.
A student of Na�onal Insurance Academy had a
ques�on for Mr Ja�n Singh. Since data collec�on
at the basic level is subject to many errors either
because it is in the local language or because of
errors when entering the data, he wanted to
know how Skymet handles that problem.
Mr Singh responded that when satellite and UAV
is used, there is no interpreta�on issue in acreage
data. For digi�sa�on of cadastral maps they have
a team of about 300 people and a significant
amount of man-hours goes into the process.
Describing the process of ge�ng individual
farmer data, he said it is "literally a census
collec�on, effec�vely we are de facto patwaris
and kanungoes." But there is no other way to do
FINCON 2017: Conference Proceedings 37
it. A lot of the data is now being manually digi�sed
because the available data is very unorganised,
and many big companies outsource that job to
Skymet.
Another member of the audience then asked
Mr Singh whether they are also able to throw
back informa�on to the insurance companies on
actuarial based pricing. Mr Singh responded that
they are a se�lement agency and they have built
so�ware. The data is either sold to the insurance
companies or they can buy the en�re so�ware
suite and use it to price products. They are also
consultants with the state governments, World
Bank and IFC.
A cyber security professional present at the
session suggested that companies should include
the security aspects while developing the
applica�ons because as insurance companies
they hold a lot of personal sensi�ve data. A�er
the Digital India push the laws have become
stringent and there can be huge penal�es and
compensa�ons to be paid out.
With this , Mr Amit Kumar thanked the
par�cipants and brought the session to a close.
FINCON 2017: Conference Proceedings 38
SESSION IVScaling New Technology Fron�ers
Session moderated by Mr Yashraj Erande, Partner
and Director, The Boston Consul�ng Group.
Panellists:
l Mr Tapan Singhel, Managing Director and
CEO, Bajaj Allianz General Insurance Co Ltd.
l Mr Rakesh Jain, Chief Execu�ve Officer,
Reliance General Insurance Co Ltd.
l Mr Vikas Agnihotri, Industry Director,
Google India.
l Mr Sagar Apte, Founder and Chief Execu�ve
Officer, CarlQ.
l Mr Shridhar Marri, Chief Execu�ve Officer
and Co-Founder, Senseforth Technologies.
Mr Erande opened the session by observing that
technology has been evolving very rapidly. He
noted that consumers have adopted the
technology faster than marketeers. The data
available now is so rich in informa�on that it can
completely change the manner in which we do
business. The en�re ecosystem is changing,
especially with the India stack.
Mr Singhel was not in favour of developing
markets trying to copy first world solu�ons. To
illustrate, he men�oned that 85% of the Indian
popula�on who can afford health insurance
doesn't have it. So it is easy to go to them and sell
without needing data or analy�cs. These are
mechanisms which make things simpler; but,
according to him, they have no relevance in India.
"The business of insurance is not going to change
in the next three to five years," he pronounced.
That is the case because insurance here is not a
pull product, it is a push product. Ci�ng his own
example, he said that as a leading insurance
company they have every device available. "But
FINCON 2017: Conference Proceedings 39
the impact on my business as of now has been
insignificant compared to the investments that I
made on them." So he advised the delegates not
to get too carried away by just fancy talks and
numbers.
At this point Mr Erande decided to bring the two
'technology evangelists' into the discussion. He
asked them how they saw the role of the new
technology, where it should get deployed and
what technologies make more sense than others.
Mr Marri saw a huge opportunity in the fact that
the country is under-insured. Quo�ng from his
own experience, he observed that the agents go
and try to sell a product. They present the
customer with dozens of insurance policies and
when posed a ques�on, they have to refer to a
huge amount of material or reschedule the
mee�ng. This is a huge loss of opportunity. That's
where the new technologies can actually figure
out the right policies. Today there are several
companies and several policies with mul�tudes of
features and benefits. Customers do not have the
�me to examine all of them and take a call. So if
there is Ar�ficial Intelligence-driven technology
that can assimilate al l the informa�on,
understand the needs of the customer and then
suggest the right product, that would make it very
simple for the customer.
Mr Apte averred that technology is changing
what we are currently doing. It is a tool to do
something be�er. If customer rela�ons are
important, then technology can help have a
be�er customer rela�onship than in the past.
Today, customer needs are changing very fast;
and the biggest challenge is to understand those
changing needs. Technology can address those
issues and help companies do be�er.
Mr Erande wondered that as technology begins
to intersect the insurance trajectory, which areas
would see maximum disrup�on. He posed this
ques�on to Mr Jain. The la�er responded that the
way in which the technology is used will
determine how disrup�ve it could be. The same
degree of discre�on should be used when
employing technology as is done while employing
humans. In his view, technology is no longer one
single en�ty that can be standardised for
everybody. Every company will use it in a different
way to make strategic choices. In today's
compe��ve environment every company has to
excel in its niche and stand out in the crowd. Can
that be done without technology, he challenged.
He gave the following illustra�on: ten years ago
they sold 1000 policies and recorded everything
with pen on paper. Today they deal with 0.5
million policies and one lakh claims every month.
Is it possible to do this without technology?
Mr Jain con�nued that while technology is
applied in most areas today, in the next three to
five year period it will have maximum applica�on
in the claims area. A person's domain knowledge
may be limited. But using bots or AI, they can
create the architecture to support the front-end
personnel to make the r ight decis ions.
Technology has myriad applica�ons; the way it is
put to use is what ma�ers to a company. "The way
forward is the choice we have to make," he
suggested. Over a period of �me, the way
technology is used will be the dis�nguishing
factor between companies.
Mr Erande turned his a�en�on to the broader
ecosystem where data and informa�on
technology are being developed. He wanted to
know from Mr Agnihotri how that could impact
the way the insurance industry shapes.
Mr Agnihotri explained that today everybody is
leaving a digital footprint. They have access to big
data and analy�cal tools; and last year they were
able to 'nowcast' accurately by brand for the
FINCON 2017: Conference Proceedings 38
SESSION IVScaling New Technology Fron�ers
Session moderated by Mr Yashraj Erande, Partner
and Director, The Boston Consul�ng Group.
Panellists:
l Mr Tapan Singhel, Managing Director and
CEO, Bajaj Allianz General Insurance Co Ltd.
l Mr Rakesh Jain, Chief Execu�ve Officer,
Reliance General Insurance Co Ltd.
l Mr Vikas Agnihotri, Industry Director,
Google India.
l Mr Sagar Apte, Founder and Chief Execu�ve
Officer, CarlQ.
l Mr Shridhar Marri, Chief Execu�ve Officer
and Co-Founder, Senseforth Technologies.
Mr Erande opened the session by observing that
technology has been evolving very rapidly. He
noted that consumers have adopted the
technology faster than marketeers. The data
available now is so rich in informa�on that it can
completely change the manner in which we do
business. The en�re ecosystem is changing,
especially with the India stack.
Mr Singhel was not in favour of developing
markets trying to copy first world solu�ons. To
illustrate, he men�oned that 85% of the Indian
popula�on who can afford health insurance
doesn't have it. So it is easy to go to them and sell
without needing data or analy�cs. These are
mechanisms which make things simpler; but,
according to him, they have no relevance in India.
"The business of insurance is not going to change
in the next three to five years," he pronounced.
That is the case because insurance here is not a
pull product, it is a push product. Ci�ng his own
example, he said that as a leading insurance
company they have every device available. "But
FINCON 2017: Conference Proceedings 39
the impact on my business as of now has been
insignificant compared to the investments that I
made on them." So he advised the delegates not
to get too carried away by just fancy talks and
numbers.
At this point Mr Erande decided to bring the two
'technology evangelists' into the discussion. He
asked them how they saw the role of the new
technology, where it should get deployed and
what technologies make more sense than others.
Mr Marri saw a huge opportunity in the fact that
the country is under-insured. Quo�ng from his
own experience, he observed that the agents go
and try to sell a product. They present the
customer with dozens of insurance policies and
when posed a ques�on, they have to refer to a
huge amount of material or reschedule the
mee�ng. This is a huge loss of opportunity. That's
where the new technologies can actually figure
out the right policies. Today there are several
companies and several policies with mul�tudes of
features and benefits. Customers do not have the
�me to examine all of them and take a call. So if
there is Ar�ficial Intelligence-driven technology
that can assimilate al l the informa�on,
understand the needs of the customer and then
suggest the right product, that would make it very
simple for the customer.
Mr Apte averred that technology is changing
what we are currently doing. It is a tool to do
something be�er. If customer rela�ons are
important, then technology can help have a
be�er customer rela�onship than in the past.
Today, customer needs are changing very fast;
and the biggest challenge is to understand those
changing needs. Technology can address those
issues and help companies do be�er.
Mr Erande wondered that as technology begins
to intersect the insurance trajectory, which areas
would see maximum disrup�on. He posed this
ques�on to Mr Jain. The la�er responded that the
way in which the technology is used will
determine how disrup�ve it could be. The same
degree of discre�on should be used when
employing technology as is done while employing
humans. In his view, technology is no longer one
single en�ty that can be standardised for
everybody. Every company will use it in a different
way to make strategic choices. In today's
compe��ve environment every company has to
excel in its niche and stand out in the crowd. Can
that be done without technology, he challenged.
He gave the following illustra�on: ten years ago
they sold 1000 policies and recorded everything
with pen on paper. Today they deal with 0.5
million policies and one lakh claims every month.
Is it possible to do this without technology?
Mr Jain con�nued that while technology is
applied in most areas today, in the next three to
five year period it will have maximum applica�on
in the claims area. A person's domain knowledge
may be limited. But using bots or AI, they can
create the architecture to support the front-end
personnel to make the r ight decis ions.
Technology has myriad applica�ons; the way it is
put to use is what ma�ers to a company. "The way
forward is the choice we have to make," he
suggested. Over a period of �me, the way
technology is used will be the dis�nguishing
factor between companies.
Mr Erande turned his a�en�on to the broader
ecosystem where data and informa�on
technology are being developed. He wanted to
know from Mr Agnihotri how that could impact
the way the insurance industry shapes.
Mr Agnihotri explained that today everybody is
leaving a digital footprint. They have access to big
data and analy�cal tools; and last year they were
able to 'nowcast' accurately by brand for the
FINCON 2017: Conference Proceedings 40
automo�ve industry, using search data on
Google.
A nowcast, clarified Mr Agnihotri, is different
from a forecast. It is a predic�on of, for example,
the number of cars that will get sold in the next 30
to 60 days. They were able to do it very accurately.
That kind of data can also give much more
informa�on about people. But when we talk
about digital, we talk mainly about acquisi�on
online. That suffers from a trust deficit both in the
company and in the customers' confidence in
themselves. Now the India stack, with its various
layers of inbuilt data, has made it convenient for
people to transact online with confidence. So
change will come, and it will be for the be�er.
Mr Erande then steered the discussion towards
risk. "Is technology going to change the nature of
risk?" he wondered. He highlighted some work
done by his company on the motor industry to
illustrate his point. "Motor is almost half of India's
GWP (Gross Wri�en Premium)," he revealed.
They classified the degree of automa�on into
various levels from 0 to 5, where level 0 is the
most basic with just a driver, and level 5 the most
advanced, where no driver is required at all. They
did a simula�on on the degree of penetra�on of
each of these levels on the Indian roads. Their
findings showed that by 2020 about 12% of
vehicles will have level 1 technology, and by 2034,
roughly 18 years from now, a large number of the
exis�ng fleet will have significant propor�ons of
level 1, 2 and 3 technology. He wondered whether
that will change the nature of risk in motor
insurance. He also pondered on how it would
affect the GWP.
Mr Singhel expressed doubt in the interpreta�on
of the findings, because this is informa�on that is
extrapolated from today's knowledge. "It has
never worked," he claimed. There is no reason
why today's ecosystem would s�ll be prevalent 18
years from now. "That is how the human brain
works. And that is how ar�ficial intelligence and
bots also work." While they extrapolate from
today's data, the human mind "always beats this
game." He disclosed that this is the reason why he
places more faith on the human mind rather than
on ar�ficial intelligence. So the findings cannot be
taken as an absolute predic�on. However, in case
the predic�ons are considered to be true then
motor insurance could reduce to 10% of the
por�olio.
Mr Jain agreed with Mr Singhel. At any given
point, there will always be two parallel worlds,
and the emerging world will a�ract people to
keep inves�ng. So he reiterated Mr Singhel's
point that the principles of insurance will not
change, and insurance will adapt itself to the new
ecosystem. "Contextually, the risks will remain,
the facets will keep changing and consumers will
s�ll be there to buy insurance products.”
A show of hands by the audience indicated that
quite a few people believed that auto-technology
would shrink the motor insurance market in India
by five to ten per cent. Mr Apte disagreed with
this. "Risks are replaced with new risks. That's all
that will happen," he stated. Even if the number of
accidents are reduced, that does not mean the
risk is reducing. "How risks are perceived is pre�y
important," he felt. What might change are the
rela�onships that are being nurtured; they may
shi� from the car driver to the car manufacturer.
But all this is futuris�c.
While Mr Agnihotri conceded that errors will
con�nue to happen although the nature of the
errors may change, the whole purpose of
technology is to bring the error rate down to zero.
"Technology will always come in to ensure that
the probability of error gets minimised." But then,
with new technology, new kinds of risks will
FINCON 2017: Conference Proceedings 41
emerge. Speaking about driverless cars, he was
confident that they will become a reality. There is
a good chance that they will be error-free because
a huge amount of science and technology goes
into the design. He could not predict how soon
they will enter the Indian market. But he was
confident that what will happen in India even
faster is connected technology. That will redefine
the insurance market. In lighter vein, he used the
analogy of the high demand for a 'Parsi-owned'
car in the resale market. He felt it was unfair that
s o m e b o d y w h o m a i nta i n e d h i s c a r s o
immaculately should have to pay the same
premium as everyone else. Now machines will be
able to describe how the vehicle has been used,
and that should affect the premium being paid.
"That's what is going to get more and more
people converted," he prophesised.
Mr Erande steered the discussion to cu�ng edge
technology such as AI and NLP (Natural Language
Processing). He prodded the panellists about
what these technologies can change, and what
value they will add.
"It's not a ba�le between the human mind and
ar�ficial intelligence," submi�ed Mr Marri.
Ar�ficial intelligence is a crea�on of the human
mind, because we are living in �mes when there is
a vast amount of repe��ve tasks that are required
to be done, that our minds cannot process rapidly.
He cau�oned against brushing off these
developments. "History is replete with examples
where they don't see the future from where we
are si�ng." He foresaw that the changes would
be fundamental to the business itself. In health
insurance, for example, it is now possible for
technologies to predict when a person will get a
par�cular disease. The en�re risk mi�ga�on
mechanism will need to be re-tailored to this
development. This is already being done in the
US. He suggested that it is �me for Indian
companies to start looking global. That's when
they will face the technology forces that they
need to deal with.
“So," Mr Erande reflected, "some things will
change, some things won't." He tried to find the
middle ground. As Mr Jain had envisaged that
different players will have different strategies,
Mr Erande wanted to hear from him about what
hurdles companies can expect as they prepare to
embrace these changes. Mr Jain observed that
we are entering the age of pla�orms and
connected technology has been gaining trac�on
over the last two or three years. He foresaw that a
lot of strategies will be built around pla�orms.
People may coexist in a smaller version of the
Internet. So companies can co-create individual
environments for specific customer segments,
suppliers and consumers. That is how business
strategies will get differen�ated. While he could
foresee a perceivable difference in the way
people look at things, he presumed that "one
thing the machines hopefully will not be able to
copy is human emo�on." He felt that human
nature may resist too much intrusion by
machines. So in the near term machines will
facilitate business processes, but the long-term
trends are not too clear.
Picking up from this point, Mr Agnihotri was
asked at what point connec�vity would be seen as
too intrusive despite its obvious benefits,
resul�ng in loss of the human touch, and would
that come at a premium? He replied that there is
no doubt that technology brings people a be�er
life, relieves them from rou�ne mundane chores,
and saves �me. That is the objec�ve of
technology. Apps like Google Now can tell you
when you need to leave for a certain des�na�on
and the �me it will take you to reach there. Such
apps also read their users' behaviour pa�erns,
and, at the click of a bu�on, can simplify their
FINCON 2017: Conference Proceedings 40
automo�ve industry, using search data on
Google.
A nowcast, clarified Mr Agnihotri, is different
from a forecast. It is a predic�on of, for example,
the number of cars that will get sold in the next 30
to 60 days. They were able to do it very accurately.
That kind of data can also give much more
informa�on about people. But when we talk
about digital, we talk mainly about acquisi�on
online. That suffers from a trust deficit both in the
company and in the customers' confidence in
themselves. Now the India stack, with its various
layers of inbuilt data, has made it convenient for
people to transact online with confidence. So
change will come, and it will be for the be�er.
Mr Erande then steered the discussion towards
risk. "Is technology going to change the nature of
risk?" he wondered. He highlighted some work
done by his company on the motor industry to
illustrate his point. "Motor is almost half of India's
GWP (Gross Wri�en Premium)," he revealed.
They classified the degree of automa�on into
various levels from 0 to 5, where level 0 is the
most basic with just a driver, and level 5 the most
advanced, where no driver is required at all. They
did a simula�on on the degree of penetra�on of
each of these levels on the Indian roads. Their
findings showed that by 2020 about 12% of
vehicles will have level 1 technology, and by 2034,
roughly 18 years from now, a large number of the
exis�ng fleet will have significant propor�ons of
level 1, 2 and 3 technology. He wondered whether
that will change the nature of risk in motor
insurance. He also pondered on how it would
affect the GWP.
Mr Singhel expressed doubt in the interpreta�on
of the findings, because this is informa�on that is
extrapolated from today's knowledge. "It has
never worked," he claimed. There is no reason
why today's ecosystem would s�ll be prevalent 18
years from now. "That is how the human brain
works. And that is how ar�ficial intelligence and
bots also work." While they extrapolate from
today's data, the human mind "always beats this
game." He disclosed that this is the reason why he
places more faith on the human mind rather than
on ar�ficial intelligence. So the findings cannot be
taken as an absolute predic�on. However, in case
the predic�ons are considered to be true then
motor insurance could reduce to 10% of the
por�olio.
Mr Jain agreed with Mr Singhel. At any given
point, there will always be two parallel worlds,
and the emerging world will a�ract people to
keep inves�ng. So he reiterated Mr Singhel's
point that the principles of insurance will not
change, and insurance will adapt itself to the new
ecosystem. "Contextually, the risks will remain,
the facets will keep changing and consumers will
s�ll be there to buy insurance products.”
A show of hands by the audience indicated that
quite a few people believed that auto-technology
would shrink the motor insurance market in India
by five to ten per cent. Mr Apte disagreed with
this. "Risks are replaced with new risks. That's all
that will happen," he stated. Even if the number of
accidents are reduced, that does not mean the
risk is reducing. "How risks are perceived is pre�y
important," he felt. What might change are the
rela�onships that are being nurtured; they may
shi� from the car driver to the car manufacturer.
But all this is futuris�c.
While Mr Agnihotri conceded that errors will
con�nue to happen although the nature of the
errors may change, the whole purpose of
technology is to bring the error rate down to zero.
"Technology will always come in to ensure that
the probability of error gets minimised." But then,
with new technology, new kinds of risks will
FINCON 2017: Conference Proceedings 41
emerge. Speaking about driverless cars, he was
confident that they will become a reality. There is
a good chance that they will be error-free because
a huge amount of science and technology goes
into the design. He could not predict how soon
they will enter the Indian market. But he was
confident that what will happen in India even
faster is connected technology. That will redefine
the insurance market. In lighter vein, he used the
analogy of the high demand for a 'Parsi-owned'
car in the resale market. He felt it was unfair that
s o m e b o d y w h o m a i nta i n e d h i s c a r s o
immaculately should have to pay the same
premium as everyone else. Now machines will be
able to describe how the vehicle has been used,
and that should affect the premium being paid.
"That's what is going to get more and more
people converted," he prophesised.
Mr Erande steered the discussion to cu�ng edge
technology such as AI and NLP (Natural Language
Processing). He prodded the panellists about
what these technologies can change, and what
value they will add.
"It's not a ba�le between the human mind and
ar�ficial intelligence," submi�ed Mr Marri.
Ar�ficial intelligence is a crea�on of the human
mind, because we are living in �mes when there is
a vast amount of repe��ve tasks that are required
to be done, that our minds cannot process rapidly.
He cau�oned against brushing off these
developments. "History is replete with examples
where they don't see the future from where we
are si�ng." He foresaw that the changes would
be fundamental to the business itself. In health
insurance, for example, it is now possible for
technologies to predict when a person will get a
par�cular disease. The en�re risk mi�ga�on
mechanism will need to be re-tailored to this
development. This is already being done in the
US. He suggested that it is �me for Indian
companies to start looking global. That's when
they will face the technology forces that they
need to deal with.
“So," Mr Erande reflected, "some things will
change, some things won't." He tried to find the
middle ground. As Mr Jain had envisaged that
different players will have different strategies,
Mr Erande wanted to hear from him about what
hurdles companies can expect as they prepare to
embrace these changes. Mr Jain observed that
we are entering the age of pla�orms and
connected technology has been gaining trac�on
over the last two or three years. He foresaw that a
lot of strategies will be built around pla�orms.
People may coexist in a smaller version of the
Internet. So companies can co-create individual
environments for specific customer segments,
suppliers and consumers. That is how business
strategies will get differen�ated. While he could
foresee a perceivable difference in the way
people look at things, he presumed that "one
thing the machines hopefully will not be able to
copy is human emo�on." He felt that human
nature may resist too much intrusion by
machines. So in the near term machines will
facilitate business processes, but the long-term
trends are not too clear.
Picking up from this point, Mr Agnihotri was
asked at what point connec�vity would be seen as
too intrusive despite its obvious benefits,
resul�ng in loss of the human touch, and would
that come at a premium? He replied that there is
no doubt that technology brings people a be�er
life, relieves them from rou�ne mundane chores,
and saves �me. That is the objec�ve of
technology. Apps like Google Now can tell you
when you need to leave for a certain des�na�on
and the �me it will take you to reach there. Such
apps also read their users' behaviour pa�erns,
and, at the click of a bu�on, can simplify their
FINCON 2017: Conference Proceedings 42
immediate planned ac�vi�es. This frees up a lot
of �me for them to do other things that they love.
He disclosed that Google's big bet is that machine
learning in AI will redefine the future. And it will
humanise technology as we go along. That is
missing in the insurance sector right now.
Mr Singhel however emphasised that "Insurance
is about emo�on, which is never missing". What
customers need in �mes of adversity is a friend
who can allay their fears. "Emo�ons to me will
always play a bigger role." Technology may
diminish risk, but it cannot change the
fundamental principle of insurance, which is
being there in �mes of need. To him, automa�on
tools can only facilitate the primary objec�ve of
keeping customers safe, secure and happy.
Mr Marri agreed that the human forte is
rela�onship building, bonding, understanding
and empathy. But humans are also highly biased,
temperamental, judgmental and bad decision
makers. "So bringing in technology to address
that is the need of the hour.”
An audience member had a ques�on for
Mr Agnihotri . He wanted to know how
n o w c a s � n g c a n w o r k w i t h p r e d i c � v e
underwri�ng. Mr Agnihotri explained that
nowcas�ng is based on Google search data. It
measures 'micro moments' to understand the
user's intent at that point in �me. There is an
immediacy element to it, and millions of micro
moments happen during a search. What it gives is
the person's need at that moment and predic�ve
FINCON 2017: Conference Proceedings 43
analysis can be done based on that informa�on.
But underwri�ng needs a much larger quan�ty of
con�nuous data flow for a system to understand
it; hence nowcas�ng may not be relevant to
underwri�ng.
Mr Jain was asked about the possibility of P2P
(Peer to Peer) insurance entering the business
space with increased use of the India stack. He
agreed that it is a good concept; but the law has to
be conducive to provide a sense of security to
customers.
Another audience member wanted to know how
technology can influence motorists to improve
their driving behaviour. Mr Apte pointed out that
telema�cs are already playing that role. His
company works with insurance partners and
rewards customers who have shown improved
performance on the road over a period of �me.
This must be in-built in the ecosystem, and it is
already happening. The panellists were also of the
opinion that although the technology is very
expensive currently, mass produc�on in the
future may make it affordable for all. That will
encourage be�er driving.
The discussions also highlighted the fact that
companies now should consider having a chief
informa�on security officer as with the
advancement of technology, cyber-crimes are
likely to go up and compensa�ons and penal�es
will become very high.
Summing up, Mr Erande noted that the session
had brought forth many important lessons. The
panellists had thrown light on the use of
technology in risk assessment, differen�al pricing
and customer engagement. The discussions also
revolved around maintaining the emo�onal
connect while companies employ technology to
increase their bus iness . He ended the
proceedings by thanking all the panellists.
FINCON 2017: Conference Proceedings 42
immediate planned ac�vi�es. This frees up a lot
of �me for them to do other things that they love.
He disclosed that Google's big bet is that machine
learning in AI will redefine the future. And it will
humanise technology as we go along. That is
missing in the insurance sector right now.
Mr Singhel however emphasised that "Insurance
is about emo�on, which is never missing". What
customers need in �mes of adversity is a friend
who can allay their fears. "Emo�ons to me will
always play a bigger role." Technology may
diminish risk, but it cannot change the
fundamental principle of insurance, which is
being there in �mes of need. To him, automa�on
tools can only facilitate the primary objec�ve of
keeping customers safe, secure and happy.
Mr Marri agreed that the human forte is
rela�onship building, bonding, understanding
and empathy. But humans are also highly biased,
temperamental, judgmental and bad decision
makers. "So bringing in technology to address
that is the need of the hour.”
An audience member had a ques�on for
Mr Agnihotri . He wanted to know how
n o w c a s � n g c a n w o r k w i t h p r e d i c � v e
underwri�ng. Mr Agnihotri explained that
nowcas�ng is based on Google search data. It
measures 'micro moments' to understand the
user's intent at that point in �me. There is an
immediacy element to it, and millions of micro
moments happen during a search. What it gives is
the person's need at that moment and predic�ve
FINCON 2017: Conference Proceedings 43
analysis can be done based on that informa�on.
But underwri�ng needs a much larger quan�ty of
con�nuous data flow for a system to understand
it; hence nowcas�ng may not be relevant to
underwri�ng.
Mr Jain was asked about the possibility of P2P
(Peer to Peer) insurance entering the business
space with increased use of the India stack. He
agreed that it is a good concept; but the law has to
be conducive to provide a sense of security to
customers.
Another audience member wanted to know how
technology can influence motorists to improve
their driving behaviour. Mr Apte pointed out that
telema�cs are already playing that role. His
company works with insurance partners and
rewards customers who have shown improved
performance on the road over a period of �me.
This must be in-built in the ecosystem, and it is
already happening. The panellists were also of the
opinion that although the technology is very
expensive currently, mass produc�on in the
future may make it affordable for all. That will
encourage be�er driving.
The discussions also highlighted the fact that
companies now should consider having a chief
informa�on security officer as with the
advancement of technology, cyber-crimes are
likely to go up and compensa�ons and penal�es
will become very high.
Summing up, Mr Erande noted that the session
had brought forth many important lessons. The
panellists had thrown light on the use of
technology in risk assessment, differen�al pricing
and customer engagement. The discussions also
revolved around maintaining the emo�onal
connect while companies employ technology to
increase their bus iness . He ended the
proceedings by thanking all the panellists.
Notes Notes
Notes Notes
Federation of Indian Chambers of Commerceand Industry (FICCI)
Jyoti VijT: +91-11-23487257, 23487417E: [email protected]
Anshuman KhannaT : +91-11-23487435E : [email protected]
Gunjan AggarwalT : +91-11-23487457E : [email protected]
Federation of Indian Chambers of Commerceand IndustryFederation House, Tansen Marg,New Delhi - 110 001
T : +91-11-23738760-70W: www.ficci.com
FICCI Contacts
Our Partners
Event Partner
Premium Partners
Documenta�on Partner
Associate Partners
Knowledge Partner
Corporate Contributor Support Partners
www.ficci.insurance.com
Federation of Indian Chambers of Commerceand Industry (FICCI)
Jyoti VijT: +91-11-23487257, 23487417E: [email protected]
Anshuman KhannaT : +91-11-23487435E : [email protected]
Gunjan AggarwalT : +91-11-23487457E : [email protected]
Monika DholeT : +91-11-23487457E : [email protected]
Nidhi TomarT : +91-11-23487457E : [email protected]
Federation of Indian Chambers of Commerceand IndustryFederation House, Tansen Marg,New Delhi - 110 001
T : +91-11-23738760-70W: www.ficci.com
FICCI Contacts
Our Partners
Event Partner
Premium Partners
Documenta�on Partner
Associate Partners
Knowledge Partner
Corporate Contributor Support Partners
www.ficci.insurance.com
Federation of Indian Chambers of Commerce and Industry
Federation House, Tansen Marg, New Delhi - 110001
T : +91-11-2373 8760 (11 Lines) | F : +91-11-2332 0714, 2372 1504
E : [email protected] W : www.ficci.com
Industry’s Voice for Policy Change
