Digitization in the insurance industry
By Marjiya BaktyerAhmed
An insurance company known as Alico starts in 1952 in Bangladesh. The nation is now one of the most densely-populated emerging economies. 160 million people and growing, we aren’t just bustling with new life, we have reached the point of saturation. Alico is now known as MetLife Bangladesh and their focus is on helping their customers navigate their ever-changing circumstances. The largest life insurer in the country, they currently have over a million customers who understand that one life is tethered to many others. With a 16,000 strong field force and around 360 employees, they are in the business of securing human lives, making sure that an individual is not leaving a financial burden on everyone around them. The organization also understands the diversity of their clientele; hence they offer products that are just as distinct and comprehensive as each person. MetLife offers products which are designed to suit people of different age groups, professions and income ranges.
Sanjeev Kapur became a part of the insurance giant in 2017; he joined MetLife as Senior Vice President and Chief Marketing Officer for its Asia region. He was the former regional head of marketing at Citi. Despite the efforts at MetLife to make insurance accessible, Sanjeev Kapur, Chief Marketing Officer of Asia observes three notable trends in the country: faster insurance industry growth, rapid digitization and recognized marque. Sanjeev is responsible for driving impactful consumer-focused strategies that will accelerate MetLife’s transformation to a more modern, purposeful and digital company. Strengthening MetLife’s digital and data capabilities will help deliver engaging experiences to MetLife’s existing customers and new prospects, particularly mobile customers. He also believes that life insurance is about going through that journey with his clients. He is leading the charge in building and delivering differentiated customer value propositions to drive business growth.
When you compare insurance penetration in Bangladesh at 0.5% with markets like India, which stands at 2.5%, the discrepancy is hard to miss. Sanjeev explains, “As the income and affluence are increasing in the country we are seeing a massive growth in our industry and it is outstripping the GDP growth. That is one trend which is clearly visible.”
With this shift in living standards, a downside the insurance market is facing is cataclysmic lapse rates. Policy lapse refers to people discontinuing the insurance coverage, or the premium remaining unpaid within the grace period so the policy does not acquire any basic cash value. Another noticeable trait is not reinstating the policy and paying the outstanding premium with interest within the next five years, in some cases 3 years. In Bangladesh, the lapse rates are north of 50%, and Sanjeev notes misinformation as one of the driving reasons: “It is common for a customer to not comprehend what he or she is purchasing. They can also realize that it was not what they were looking for or their needs did not get fundamentally satisfied with the product purchased by the customer.”
The world is in the grips of a digital revolution, with wireless channels of communication overtaking traditional channels. Sanjeev surmises the need for tapping into right channels of communication-based on the category of the product, explaining, “When you are looking at insurance with its 0.5% penetration, you can safely assume that digital channels can play a very important role for this.” In order to create awareness and evangelization of the product, doubling down on digital communication is the next step into the future.
At MetLife, a critical part of the strategy is to deliver the right solutions to the right customers. The insurance company is embodying this mindset when looking to transition from a product-led company to a solution-led company. Sanjeev expounds, “A solution is a combination of products and services you offer to the customer, as well as unique experiences which you are creating to provide access to the product and services for them.” MetLife’s Life Card in Bangladesh is an example of value-added services provided to customers. This card provides access to quality hospitals as well as quality diagnostic services at cheaper prices with discounts ranging from 10%-35% which creates access, knowledge, and affordability for the use of these health care services. Novelties are their agenda as they transform into a solution-lead company.
Focusing on healthcare infrastructure in Asia, Sanjeev observes, “It is a pressing matter because governments across Asia are not being able to provide or keep pace with providing high-quality health infrastructure in line with the rising health issues. For every $1 spent on health, $0.42 are spent out of people’s pockets compared to the US where only $0.07 are paid out of pocket. The rest is being paid by government or insurers.” In a country like Bangladesh where the majority of people do not have access to pension or health facilities from either government or employers, MetLife offers health coverage as a rider due to a regulatory decision in 2015. “Since there is demand, life insurance companies are trying to convince the regulators, and show the evidence that stand-alone health insurance is required.”
The CMO explains, “There are three core needs for our customers – how can I protect my health, how can I protect my family and how can I protect my future?” Bearing this in mind, MetLife is focused around creating awareness and understanding of the MetLife brand as they go forward, promoting the message that, “We believe that we can play a more powerful role in our customers’ lives if we can help them from getting into an adversity.” This role will provide value for customers both today and in the future, in the event of an adversity. As an example for addressing health protection needs, MetLife in Asia is keen on providing access to health services via analog and digital modes across the whole care continuum right from education about prevention of serious diseases to access to high quality, online and offline health-tech companies – which will provide diagnostic capabilities, financial protection, as well as post-critical care for illnesses, like access to nursing care and rehabilitation centers.
With a shift into a solution driven approach, MetLife is looking to reimagine the end-to-end experience provided to the customer by implementing the right use of technology for acquisition and the right use of technology in servicing the customer. Sanjeev details how they want insurance to be more than a product, “We are going to offer either proprietary digital experiences or we’ll plug it into the digital ecosystem of that country to make it easy for the people of that country to have access to these services.” This is a great example of how MetLife is turning into a solution-led company, while also delivering on the vision of preventing people from reaching adversity. “Besides health, we can also employ this for other core needs of the customers. This is a long journey, and we’ve taken our first steps in that direction.”
