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IT could be a change agent in the efficient cross border delivery of products and services…

Jul 5, 2015

Praveen Gupta is CEO and Managing Director of Raheja QBE General Insurance Company Ltd. A joint venture between QBE and the well diversified Rajan Raheja Group, where he is trying to build a contrarian business model. He has over three decades of industry experience in diverse markets like India; Thailand; Hong Kong and U.K. Praveen is a Chartered Insurer, Fellow of Chartered Insurance Institute (UK) and Insurance Institute of India. He has a Diploma in Direct Marketing (IDM, UK) and is an MA from St. Stephen’s College, Delhi. He is a recipient of D. Subramaniam Award and SK Desai Memorial Prize by Insurance Institute of India. He is also a recipient of a special prize from the Geneva Association and the Group Study Exchange Award by Rotary International.

IT could be a change agent in the efficient cross border delivery of products and services within the Insurance domain

Praveen regularly writes (on diverse subjects) and speaks at prestigious national and international forums. He championed the cause of Indian insurance industry liberalization, from the very early days. Praveen was also very closely associated with the Bombay Chamber of Commerce & Industry (BCCI), where he was the Chairman of the General Insurance Committee. He is currently Deputy Chair of the Chartered Insurance Institute’s Diversity Action Group and also promotes the cause of Diversity by a dedicated blog ( Praveen is on the Board of Education, Insurance Institute of India, Governing Council of Indian Institute of Risk Management and is a Member of the Australian Institute of Company Directors.

Q: What are the key business trends shaping the Insurance vertical in India? Where do you see the major opportunities going forward?

A:The stimulus is coming from across a spectrum of areas. There is scale but small ticket size at the bottom of the pyramid, thanks to the initiatives of the political leadership. Rising urbanization, socio-economic and life-style changes are driving the creation of what will turn out to be a humongous middle class. This will see a surge in the asset class apart from growth in the auto, health and travel classes and a whole range of sports, leisure and entertainment related risks. Infrastructure and industrial build-up are additionally posing a new scale of risks. The Internet too is making everything and everyone more vulnerable to cyber risks. Last but not the least, tort is raising its head thanks to the fiduciary and governance push where the Companies Act 2013 is coming into play. Now besides company boards, all professionals will be increasingly answerable for their errors and omissions.

Q: What is the business model that Raheja QBE is exploring going forward?

A: We are focusing on areas where we can bring a unique value proposition that’s backed by global expertise and capability of the foreign partner. We do not wish to be everything to everyone. Nevertheless, QBE is looking to explore the Indian growth opportunities that justify deployment of capital, owing to their adequate return on investment for the promoters.

Q: What are the new technologies that are likely to have the most impact on the Insurance vertical? Are Big Data and Analytics going to be critical for the Insurance segment in the future?

A: Big Data and Analytics are critical for both pricing and product development in the very dynamic segmentation process that we have got into. Customers will increasingly not like the ‘take it or leave it’ approach. They will expect a product suited to their needs in a preferred price range. New tech will need to enable this in real time. It will also need to facilitate a better understanding of all insurable risks impacting a customer. Big Data and Analytics will not just work for an insurer but the insured as well.

Q: What is the role that the Indian IT-BPM industry can play in helping the Insurance sector in its Digital journey?

A:The Indian scenario is rather ironical. We have cutting-edge ITES in the BFSI space as off- shored or outsourced services located here and there are also some nascent or rudimentary technology applications sitting side-by-side. All you need to do is to plug the local market’s growing needs into the tech and human resources available right here. This could generate tremendous synergies in a win-win sense. There is a big scope for reverse innovation. The Indian government is pushing insurance inclusivity at the very bottom of the pyramid. The products and processes are simple—thereby bringing together one of the largest masses of humanity on an electronic platform with insurance as a common denominator. As this moves up the pyramid’s hierarchy, a vast new market will evolve. The lower the cost of reach, the lower will be the combined ratios of the insurance carriers. This will make insurance sustainable.

Q: In what ways can the IT industry disrupt and change the way insurance business is conducted?

A:So far the IT industry has been a good follower of the insurance industry. It is now ripe to lead this industry. The changes henceforth are less likely to be linear nor would these be programmed. Take for instance product and price comparison providers. Very soon there will be de-matted electronic policy stores which the individuals or commercial customers will look at and see patterns of risk and costs which they may wish to influence. Google could in its own way revolutionize the conduct first in the form of quotes, then in terms of access, in terms of service, enhancement of existing covers and cross selling or cross buying. The focus will move from ‘point of sale’ to ‘moment of truth’. Customers will look at technology as a means of facilitating transparency, hence trust and not just in a transactional sense. The IT industry started with body shopping, then slowly evolved into differentiated and sophisticated processes, and then moved to high-end strategies. Today, many of the companies have brands and cash that’s far in excess of many in our business. There is nothing to stop them from achieving a ‘brand inversion’, whereby they themselves could become insurers. Thanks to the power of IT, the intermediaries will have to increasingly and regularly demonstrate their value proposition. ‘Dis-intermediation’ and ‘channel transitioning’ will also be falling in the realm of the IT strategy. After challenging the core providers of insurance—both carriers and intermediaries, the next levelling could come in the prudential space. IT could be a change agent in the efficient cross border delivery of products and services within the Insurance domain. It could redefine the stereotypic ways of looking at policy holder protection. – See more at:

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