A Tech Lyceum episode

InsurTech Unplugged: Riding the Waves of Digital Transformation

Guest Speaker:
Ravi Chauhan
Delivery Head, BFSI vertical

Amit Jain
Practice Director, BFSI vertical

Transcripts

Hello and welcome to Tech lyceum. The topic of discussion on today's episode is insure tech unplugged, riding the waves of digital transformation now sounds very interesting, and to help us dive straight in, we have two lovely speakers today, starting with Ravi Chauhan, who is the global delivery head for the BFSI vertical at Birlasoft. Ravi, I hear is a super enthusiastic & super energetic leader and a big champion of fostering a culture that drives innovation in the organization, apart from wearing many other hats of leadership, Amit Jain also joins us today. Amit is the insurance practice director within the BFSI vertical at Birlasoft Now something really interesting about Amit is that he is cpcu certified, which, if you know, is one of the most coveted certifications in insurance. He's got 20 plus years of experience in insurance, working with global insurance carriers. Welcome to the show, gentlemen, it's great to have you.

 
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InsurTech Unplugged: Riding the Waves of Digital Transformation
Speaker – Ravi – 01:14
Thanks. Neerja, thanks for such great introductions. More than probably we both are, but thanks. Thanks. Happy to be on the show.
Speaker – Amit – 01:22
Thanks, Neerja, I'm excited to be here.
Speaker – Neerja – 01:25
Absolutely, really happy to have you here. So let me preface this conversation by saying the insurance industry's image as a tech follower has radically shifted with its embrace of digital innovation, reshaping traditional practices and creating a hub for digital progress, right? So on that note. Ravi,
Q: How would you describe the shift in the insurance industry from, you know, being perceived as a slow adopter of innovation and technology to now its current status as a thriving hub of digital innovation and transformation.
Speaker – Ravi – 01:58
So I think you very rightly put it Neerja, that it was perceived. And now I would say that it really is a perception that an India and globally, the insurance industry used to be very late in adopting any new technology. Reasons unknown, or maybe they felt comfortable with the current technologies that they have, which have served them very well first so many years, but if you look at it, it has changed, not because the companies are forced to transform, to become digitally innovative, but they have chosen to transform themselves. They've taken major steps towards digitizing their business model, especially the way they engage with customers, which is the big focus for them, because customers. These days, every company is focused on customers, and while Fintech is focused on more of the enhanced technology, ensure tech is focused more on the people directly. So that's the reason why I say it's more of a focus on the end customer, rather than just the technology that they're looking at. And hence the transformation that they want to go in for. The other big concern for insurance companies today is security. We all know the things going on in the world today about hacking and the terrorist the activities that are there due to which all the insurance company are liable to either get hacked or some data center going down due to even the climatic changes that are happening. So they need to ensure that they are well placed to cater to the customers. 24 x 7 , 365, days a year. And if you look at it, they started the building the transformative mindset well before the pandemic. So insurance companies, it's not that they just because the pandemic had come, they had to get into this mindset of getting transformative, but they had started already building towards it. The only thing that happened in pandemic is that everything got accelerated, like we have seen in other industries. And talking about the analysts so Gartner, for example, forecasts global IT spend for insurance to increase by 7.9% in 2023 which is approximately $200 billion plus. And from 2022 to 2027 it's poised to increase to 8.1 given the growth in IT industry, but also because we can see the insurance companies going into this model. So overall, the insurance organization have now become a part and parcel of the most transformative organizations across the globe, and are driving towards those agile mindsets, keeping security, data, it, people, all these in the same focus. So that's what I would say, in terms of insurance company really getting there again, it is more of adoption of the ways of working of today and being future ready.
Speaker – Neerja – 04:50
Absolutely, the only way to take your customers with you into the future is to transform, I suppose, and Amit in the context of this digital transformation journey.
Q: Could you tell us which specific business areas have insurance companies actively been investing in, and what areas do you think they anticipate prioritizing in the future? Maybe you could also provide us with some use cases as examples for everyone listening in?
Speaker – Amit – 05:16
Yes, sure. Neerja, I think that's a very good point that where, actually, if I am embarking on a digital journey, that where I am investing. So yes, for insurance companies, the major area has been the product quality, customer satisfaction and the regulatory compliance. So these are their top priorities before anything else, even their profitability comes later than the customer satisfaction and regulatory compliance, they take the seat ahead. So what we have seen across various customers in US and and in India, that, first of all, it comes with their core insurance platforms, transformation they have been in. I mean, when you call it tech debt. So this is their tech debt. They have lot of legacy systems. They are they were still running as 400 and mainframes. So in their digital transformation, that change in the mindset. In last few years, they have started to think replacing their core platforms. That is, their policy admin system, their claims management system, billing, reinsurance, all their core insurance organizational functions they are trying to adopt, whether they in in house custom development, or they deploy a commercially off the shelf, available product that vary by company to company and geography to geography and the priorities of the company as well. But yes, they have embarked on this. So this is one key area where they start with core insurance platform transformation, then within the Digital bracket with they are more closer to digital that will, I would say, customer experience and engagement. So CX that you say, then data analytics is another and then the automation and process optimization. So if I just quickly drill down on each of these customer experience, they are trying to build the use cases, where they build the customer portals, the personalized customer portals that are intuitive, that are interactive. They attract the customer in whatever customer wants to do, whether it is asking for a quote, or it is any servicing of the policy, or it is registering a claim. So across the value chain, across the touch point that they have, then Chatbot is another area where they have those virtual assistants where they can answer any customer query. 24 x 7, that was another area, then mobile apps, building mobile apps for their distribution channel, for their end customer, where they can generate code seamlessly without providing a lot of information in the filling the application forms and all. So I think these are the things that fall in the customer experience, data analytics. Yes, in underwriting, they help with the risk assessment, they try to analyze the data. So this is another use case that helps the their core function of underwriting. So underwriter needs to analyze a lot of data when they try to decide that whether they want to write this risk or not. So this is another use case where using these new technology, they are trying to facilitate risk assessment for the underwriters, then I can say fraud detection. I think another area. I mean insurance company is no different than others. Fraud is a concern for everybody, and as Ravi was also touching on it, that it is another contributing factor that you have to adopt new technology because of these cyber crime and everything. So I think, yeah, that's pretty much some of the key low hanging fruits i would say that insurance company sees with more eased that okay, let's do it. Let's do something in these areas.
Speaker – Neerja – 09:05
Amit, if I may ask you a follow up question. You know, digital transformation is not without its challenges, right?
Q: So what are some of the biggest ones that insurance companies face in their digital transformation journey? And Could you perhaps also offer up some tips for overcoming these obstacles,
Speaker – Amit – 09:23
Definitely. I think that's a very, very basic premise, that wherever you go, whatever you talk about, there are challenges. Even today, we are talking about artificial intelligence as a kind of a apocalypse, that everything will change with artificial intelligence, especially with the Gen AI, that everything will change, nothing will remain same. Even here, there are a lot of challenges. So same is true when we talk about insurance company or any carrier going on to a digital transformation journey. Yes, there are challenges I can think of couple of key points. One is legacy system. So I think we briefly touched on when I mentioned core platform modernization. So legacy system is their main challenge. So their code, their business rules, their business logic, business entirely, everything is embedded in those age old legacy systems, legacy infrastructure that holds them back even when they are embarking on this journey. This is something that they need to overcome. They will have to to do lot of reverse engineering to extract all those business rules that have been built over, I would say more than two decades, more than I mean over a period of two to four decades, all the business logic that has been developed in those legacy system without proper documentation. I think that is the biggest challenge that I have seen. And I have seen analyst also talking about the same thing. And another thing I see the data privacy and security again, insurance data is a high value target everybody, anywhere you go, insurance data is a high value target for the cyber criminals. So it is data privacy and security. They are of the Paramount concerns. They deal with very sensitive data, and they have to adhere to strict regulatory requirements. And remember, when it comes to regulatory requirements, the penalties for any mis act can be from few $100 to shutting down of the entire company. So the regulatory requirement is always a concern. So these are the challenges that come. And I think, as I mentioned, for legacy, most of the time they have to rely on their they rely on their employees who have been there around for I mean, as the system aged, their employees also aged, and they remember some of the things. They know things by their heart, so they have to do lot of reverse engineering, and they have to talk to their employees to document those business logic that is now to be developed in a new technology, then in data privacy, I think they are trying to adopt the best practices. Whatever is there, be it, what are the encryption logic, encryption rules, all those things they are trying to do. So recently, was reading about one of the Indian insurance Bajaj Allianz. This is a big name, and they have invested heavily in the cyber security measures. So they have implemented an advanced encryption and multi factor authentication to safeguard the customer data during their online transactions, so they are finding ways to address the challenges as well. So yes, I think that's pretty much to answer your question on the challenges.
Speaker – Neerja – 12:53
Yeah. Well, Amit, wherever there are challenges, solutions are bound to follow, and this is where innovation really matters, right? So Ravi, as we wrap up this conversation, tell us how Birlasoft is geared to solve some of the business problems that you know the industry is facing.
Speaker – Ravi – 13:09
Yeah, and you very rightly put it, and I think Amit has mostly covered from the industry perspective, and how we as Birlasoft are looking at various things and making ourselves also future ready, but looking at how Birlasoft is thinking of solving these problems, I'll just broadly divided into four categories of the constructs that we have, the partners, the investments that we have been making, and the digital offerings that we have, right? So let's, let's just quickly and briefly touch upon all of those. So if you look at the constructs that we have and how the Birlasoft leadership has evolved during the last one year. The number of leaders at the top level, right from the CEO to many sub vertical heads, are all with BFSI and many with insurance backgrounds. And you look at the recent joiner that we have, the CEO who's just joined a couple of weeks back he has lived his entire life and insurance. So looking at overall BFSI perspective, we are at a place today where we can claim that we know our domain in terms of the leadership talking that language, as well as ensuring that our people also talk the same language. And if you look at our tenants, that we have come up with the six tenants that our leadership, our CEO, has come in with the organization. First, quick decision making. Be bold, people centricity, Say Do ratio and customer centricity. I'll just move to the partner ecosystem. In the partner ecosystem, we have tied up with companies like Microsoft and SAP. And from the domain perspective, we from insurance perspective, I'm just talking about just the overall BFSI perspective, we have also tied up with Duck Creek to ensure we take the solutions and the right partners as well as the right.Tools and technologies to our clients. It's not just one size fits all. So we keep on evaluating different partners. We keep on looking for new partners to ensure we give the best of the best to our clients, and not just what we know. So it is more of what solves your problem, rather than we telling you that this will solve your problem, and hence you have to take it because we only know of it. Many of the companies that you see in the industry today are competitors. If they have a strength in one area, they would probably force it back particular strength to all their clients. While Birlasoft, avoids that. It is, as I said, it is more of a customer centric company, which focuses on, how do we ensure that what is right for the client is what we do. The third part that I spoke about was investments. And in BFSI, we tie very closely with the horizontals. So we've got four horizontals with us, the infrastructure, the ERP, the digital and the data analytics. We are more closely tied to digital and data analytics for obvious reasons. You would know, though, infrastructure is also a big piece of us, considering that we also take security very, very seriously of our clients, but data and digital are the two things that we are doing big time with our clients today, looking at the kind of work that they have today. Right? What we are also doing in terms of investment, creating the tools and frameworks which we'll talk about and in the next part that I was talking about digital offerings, but our people. So if you look at it, we are in a people industry wherein we need to ensure that our people are ready to serve the clients for the future, rather than ready to serve the clients for the past, right? So we are investing heavily. We have tied up with Coursera. We are investing very heavily in our people to get the knowledge that is required, including the certifications that are required for the domain. So most of the companies will tell you we are just doing Gen AI cloud. We are doing that that is basics for us. Now. That is not even the next level. That is the basics for us. Everybody has to get those certifications. What we are doing on top of that is ensuring that all our people are trained, and most of them are certified on one or the other insurance domain also. So that is an addition that we are doing. Apart from that, we have this innovation week every quarter where in our people are going and taking those theoretical skills from the courses or certifications that they have done and putting it into practical use, which are the real industry use cases or pain points that the client has coming up with some point of view, or some strategy, or some tool or framework which gives them a chance to enhance their skills in a practical way and solve the problem for a lot of our clients. So we have got lot of things coming out of these innovation weeks, which actually we are able to use practically with the clients. So the last the digital offerings that I would talk about with the when we send case, we have many digital offerings, but I'll just talk about one particular case, about submission automation that we had, we had innovation week in the last quarter wherein we are now bringing in the chat bot into that through Gen AI and trying to fit it in to help our clients do their work even more seamlessly and maybe increase their productivity by 80 to 90% so that is how we as Birlasoft are trying to help our clients and ourselves get to the next level of transformation and moving towards that.
Speaker – Neerja – 18:44
That's fantastic. Ravi, thank you for taking us through that, and thank you, Ravi and Amit for giving us an insight into what it means to be future ready in Insurtech. It was great speaking with you both.
Speaker – Ravi – 18:56
Thanks. Neerja, it was a pleasure talking to you too.
Speaker – Amit – 18:58
Thank you, Neerja. It was a good interactive session.
This is tech Lyceum podcast from Birlasoft.
Speaker – Neerja - 19:10
And there we have it, another fascinating topic covered right here on tech Lyceum, and there's a lot more to look forward to. I do believe we all gained a little something from today's episode, I always learn a thing or two, and I hope that's what you're taking away as well, if not more. And let me just leave you with some food for thought, as I remind you that Birlasoft has got great credentials in solving key business problems faced by the insurance industry with their impeccable record of delivering high quality services across a wide spectrum of technology area. So there you go, something to think about. I'll catch you next time on another episode of Tech lyceum. Until then, it's me, Neerja, signing off, bye, bye.
You were listening to tech Lyceum, a podcast from Birlasoft.