Ahem: This article is written as our personal opinion about Life Insurance as a whole, and the direction it is heading into.
If you are allergic to strong language and hard truths, we suggest that you skip it in its entirety. But if you love subtle meme references, boy are you are in for a treat!
Life Insurance as an industry seems to be the fat, fugly chick from your secondary school years who is in a hurry to make up for lost time – slapping on botox, lipo, and chin contouring within the same month.
After limping along for decades with processes and mindsets remnant from the previous century, it has found the need for a mega transformation within the last couple of years, with 2019 being the apex of it all (so far, by our estimate).
Last year was the one in which we saw the highest number of mentions about insurance + technology, manifested in the lovely buzzwords of: “fintech, insurtech, regtech, blockchain, digitalization, machine learning, artificial intelligence.”
Technology seems to the prom night that every cool kid is invited to, and of course, our fat, fugly girl protagonist needs to have a date.
We aren’t Luddites for sure (we go as far as to turn our desktops on some days), but there is a general sense that the industry is missing the plot insofar what is really needed to rejuvenate it.
Let’s wind the clock back a few years to demonstrate that point.
Backstory before Technology became the focus
The year is around 2010 – 2015, and many insurers are still upholding time-honored traditions held dear by their ancestors: 0 digital presence, a preference for manual processes, and generally loving all things paper.
Even as late as 2013, many of these insurers’ websites were still clunky, downright ugly, and near impossible to navigate (Some of them still are, we checked).
But gradually simplicity became the focus. Sites were updated with friendly sited fonts, attractive and intuitive navigation flow, and some even had great graphics.
Then came in the digital insurers, who promised to make purchasing easier than redrawing entire electoral boundaries (sorry, I digress). A few clicks here and there, and voila! You are now the proud owner of a Life Insurance policy.
Somewhere around the same period entered the much-vaunted: Chatbot (you do remember it, don’t you?)
One insurer built an entire campaign around it, hailing to be the only Jarvis you need in your life. And of course, no one gives two hoots about it today.
Then came the holy trinity: Blockchain, Machine Learning, and Artificial intelligence.
Together, they painted a world of untold possibilities – insurance for the unbanked and underinsured, all done with only a smartphone.
Where does that leave us?
Why aren’t all of us buying more insurance than ever before?
(Total Life Insurance premiums for 2019 compared to 2018 increased a grand total of…. 0.4%. We kid you not, just check out the Life Insurance Association website here)
Dissecting the role of Tech in Insurance objectively
Yeah, its the savior we all need…
Again, we have nothing against technology and progress.
Tonnes of manual processes in the backend can and should be automated. Claims filing, processing, payout, for example.
Purchases should be able to be executed easily in front of a screen, nothing wrong with that.
No one will say no to policies that are secure, immutable, and tamper-proof.
If there is a central hivemind of intelligence poring through terabytes of data and recommending me the coverage I need, then more power to you, the insurers, I say.
(But at least come up with a chatbot that is really useful first, please)
… but doesn’t solve the one issue truly plaguing the industry
Technology simply isn’t a substitute for knowledge.
It is the knowledge that we need a certain sort of coverage, that is the genesis of every policy purchased. (that, along with the persistent nudging of an insurance advisor)
I contend that while most of Life Insurance’s other challenges are substantial (like risk calculation, fraud detection, claims and policy processing), all of them pale in comparison when stacked up against lack of knowledge about insurance by the man on the street.
(Insurers would sell way more insurance if everyone knew about its importance right off the bat)
After all, people won’t buy what you don’t understand, especially for a product that gives no tangible satisfaction or benefit upfront.
Our bold prediction for the future
We started in late 2014 with simplicity and ease of comparison as our calling card. We’ve since seen almost every other insurer and startup follow that premise.
With ease and simplicity out of the way, the next block to be put in place is price competitiveness, which kinda works…
… but only for commoditized products like General Insurance. You renew your motor insurance on a yearly basis, so the impact on buying the “wrong” policy isn’t that severe. Ditto stuff like travel insurance.
No dice with Life Insurance, despite one notable digital insurer offering perennial discounts at every given opportunity (e.g, Deepavali, Mother’s day, Saturday, Sunday, etc)
So it boils back down to knowledge. The ease and simplicity of purchase, the price discounts, and all other frills come into play once the knowledge issue is fixed.
How is this knowledge gap going to be fixed? We have a pretty good idea, actually.
But we aren’t gonna tell.
We are gonna show.
Watch this space as we transform into an all-new platform that could potentially solve Life Insurance’s biggest headache.
In the meantime, here’s a hint to help our fat, fugly girl out.
What is truly important for a person to be considered attractive?
Remember, you saw it here first.
www.ClearlySurely.com aims to eradicate the knowledge gap between consumers and Life Insurance. Our Vision is that one day, every Man, Woman, and Child will be properly insured.
We are also in the midst of building a top-secret new platform that will change the way people view financial planning. PS. It does not contain lame hyperboles like “fintech” or “insurtech” or “machine-learning” or “AI”.