Disruptive Innovation in Insurance

Raj: Hi, everyone, my name is Rajaram. I go by Raj. I’m a vice president with Infosys, and I focus on the midsize insurers and banks in the US market. Today I have the privilege of talking to Anurag who heads the FSI practice for Newgen, and we are going to discuss today on a very important topic, which is how to accelerate digital transformation for insurers and especially the midsize insurers. Anurag.

Anurag: Thank you. Thank you so much, Raj. And just by way of introduction, I’m Anurag Shah. I manage the products and solutions and, as Raj mentioned, the insurance, and especially insurance vertical and towards the midsize insurers is what I focus on from the Newgen products and solutions perspective. So just to kind of kickstart right, Raj, I mean, if you look at this insurance industry, how are you seeing it? What is your view on the challenges that these, especially, midsize insurers are facing at this point in time, just post-COVID? And so how do you see it?

Raj: Thank you, Anurag, great question. See, the midsize insurers have always differentiated with their personalized experiences, speed, and agility. And there is a risk to this historical competitive advantage they have had if they don’t undertake digital transformation of their business and evolve to meet the changing customer needs. This is because the large carriers have been moving very fast on an end-to-end digital transformation to deliver personalized and consistent experiences across their channels for their customers. And as we all know, midsize carriers have spend limitations to embark on such a large-scale digital transformation journey.

Let’s take some examples. The majority of the large carriers are using conversational AI capabilities for processing claims, providing both speed and personalized experience to their customers. We know that poor customer experience during the claims leads to lower customer retention. And reducing customer churn by as little as 2% a year can cut cost up to 10%. So this is a very important area. Large carriers are also extensively leveraging insurtech ecosystem to sort of integrate with emerging capabilities to fully remote-enabled claims processing. They’re also looking at end-to-end claims processing using AI for certain threshold limits, especially the high-volume and low-cost insurance claims.

In other examples, I’m seeing the large insurers really making the transformation from a digital perspective, is using telematics to make automated SOS calls, the prediction of accidents using IoT sensors, using machine learning to estimate loss reserves, and using AI image recognition to estimate the repair cost during claims processing. And so these are all very important areas for digital transformation for the midsize insurers to sort of consider. Also, if you see, the midsize insurers are historically focused on owning the complete value chain, whether it is on the operation side or the technology side. And their limited outsourcing has meant they have to make large, outsize investments because they lack the scale economies.

And the other area where I think it’s very important for the midsize insurers to consider in the challenge they’re facing is on the legacy technologies and the technical debt. And this is actually really sharply increasing their cost and expense ratios. And it’s very important for the midsize insurers to adopt next-gen and new technologies to become more efficient. And given, right, all these changes and challenges, I believe the midsize insurers have to match the digital capabilities of the large insurer so that there is not a big gap in the experience they provide and the efficiency ratios between the large carriers and the midsize insurers.

Anurag: That’s really quite an insightful perspective of the industry and especially, like you said, midsize insurers. So with all that being said, right, from your vantage point, how do we approach the digital transformation around the areas that you talked about?

Raj: So, Anurag, that’s a great question. Infosys has created an end-to-end digital transformation playbook and blueprint specifically focused on the midsize insurers. This is based on trying to achieve speed, accuracy, and trust. And this playbook covers multiple areas. It starts with identifying the business OKRs and digital metrics to start the digital transformation, looking at the customer journey design, and reimagining that both for the customers and the internal colleagues, identifying key digital transformation initiatives which drives front-to-back digitization, looking into next-gen technologies including API, cloud, etcetera, data, etcetera.

And then we are also, as part of the playbook, looking into key enablers like how do we do from a delivery perspective, right, agile and product-centric delivery models, design labs, looking into the whole engineering talent, new ways of working. And one of the key areas we have included is how to find the money and then fund portions of this transformation because this is a very important area from a midsize insurance perspective. And we also have, as part of this, a transformation office, which not only executes this across the organization but also helps to track the value that is being realized.

While this is a very comprehensive blueprint, we have made it very modular to focus on key processes like claims processing, policy administration, or contact center. So the midsize insurers can use specific journeys, specific focus areas to transform and achieve the business outcomes quickly. And one of the things we have also realized, as we put this together and as we work with many of our clients, is we can accelerate this journey if we use a platform like Newgen, right? And Newgen acts as a catalyst to drive value and get this digital transformation going quickly. So in this context, right, I’m very keen. Anurag, what is your perspective, right? How do you see acceleration of digital transformation using a platform like Newgen?

Anurag: Yeah, that’s a great way of looking at the challenges that mid insurers are seeing, and, Raj, the way you bring your Infosys value prop to help them in what pain and challenges that they’re going through. And your question about Newgen platform, right, how Newgen platform is going to help accelerate this entire digital transformation, so I’d like to start by saying that IDC projects, that about 80% of the worldwide data is going to unstructured by the year 2025, in less than three years. What it means is these insurers, employees, and partners, and their customers, they are going to start spending a lot of time in gathering information, going through those information, and oftentimes repeatedly going through it comparing certain content like, let’s say, policy of previous years versus policy of this year for different terms and conditions, and looking at the videos, accidental videos, listening to audio calls from contact centers.

So all of these things are going to result into, one, low productivity, and second, high processing time. And that’s where Newgen low-code platform coupled with its content services and customer communication comes into the picture, and it really helps insurers in four or five areas. One is accessing the information, all through by sufficiently helping discover the documents. Now if we just see the very nature of these insurance companies, they are actually sitting in a gold mind of the decades of content that they would’ve accumulated. These policy holders would be renewing an existing with these insurance companies for years and years. There would have been hundreds of interactions and hundreds of content and all of those things gathered.

How easy would it be for a processor within these, or a operational people within these insurance companies to be able to get the relevant content from the history without having to go and manually search in the context of this service that they are rendering to these policy holders. So those kind of things, enhancing the collaboration, bringing in case management, automating those lines of processes. You talked about claims. You talked about policy servicing. You talked about policy issuance, Raj, automating all of those processes and then communicating back to the policy holders, right, reaching back to the customers, generating those required documents, policies, binders, alerts and notices, and all of these things, cloud hosted with adequate security and control with all those leading technologies we talked about, artificial intelligence, machine learning, natural processing language, and all of those things. So that’s how we see Newgen platform coming into this and kind of gelling in with what you talked about Infosys’ digital transformation value prop.

And with that, I would like to take another perspective on… You touched upon certain very interesting aspects, and I’d like to take that leaf from there, that these digital journeys appears complex. The journey of the acceleration becomes a little bit complex as it appears to… and especially to the midsize carriers as compared to large carriers. So how do we really go about starting these transformation journeys? What is your view on that?

Raj: Yeah, great question, Anurag. So the way we have seen, working with clients, the best way to approach this is look at specific areas and use cases in terms of where we want to transform, right? And I talked about the digital label, and that helps to identify the broad areas. And then in order to get to value, right, we have what we call as a digital factory. And this has actually, I would say, three pillars and working together. One is a research ops. So this is about identifying and prioritizing the ideas, use cases, and customer journeys, which actually makes the highest impact and drives the business outcomes, right?

This is followed by a design ops, and this is where we do very rapid prototyping. We prioritize the features and to find minimum viable products. This helps to set the stage for what we have as the DevOps. This is where the story backlogs are created. We try to build then release, and also as we roll it out, we actually evaluate the impact, the business impact of the various features and then the whole sort of feedback goes back, right? So by focusing on a sort of digital factory approach and taking bite-size chunk of the problem, we are able to sort of deliver a lot more value than doing it in the old-style waterfall where all the scope is identified, and the feedback loop is really almost non-existent, right?

So we recommend using this digital factory approach, and Infosys has set up local hubs across the US, which actually helps to work closely with both the business operations and technology teams, with the clients, and bring together and make this whole thing real, right? So this is what we think is a way to quickly move faster and start delivering value to the insurers. If you could share some of the successes, what type of use cases they’re focused on, what type of outcomes they have seen, right, and what type of acceleration they have achieved from a digital perspective, so, Anurag, if you could share that, I think that will bring to life some of the discussions we have been having.

Anurag: No, certainly, and it is probably a perfect segue into the solutions that have been implemented on Newgen platform. And I will take maybe a couple of examples. One of the example is this midsize insurance company, and they were having challenges with their policy servicing, customer request management, producers servicing. So the chief operating officer of this insurance company, in his own words, wanted to do a digital policy servicing kind of automation. He really had this initiative that wanted to do. And when we started that journey on Newgen platform to automate, we found that they were having more than 150 different workflows, each one corresponding to a different request types, could be financial in nature, could be non-financial in nature, could be administrative for all these policy holders. Some requests were coming directly from policy holders. The others would come through their producers and agents.

The policy holders may be having more than one policy. The request would include corresponding to one policy or multiple policies. So when we looked at that landscape… And that is not unique to just this one customer. We have seen similar situation in almost all these midsize insurance companies. So one, rationalizing and optimizing all of those 150-odd workflows into intelligent business processes and simplifying it for their internal operational staff, connecting it to their portal, and then bringing their customers and producers and agents as a participant to this entire journey of request management. So all of those things, coupled with, again, like I talked about, the content services platform wherein we ingested their entire legacy content, which they had accumulated over last, let’s say, decade or more than a decade, all of those, bringing those into Newgen content services, and then helping the operational staff while they are processing these customer requests to utilize those content from history and from their ongoing operations, on interactions from the customers, what customers are sending.

So this Newgen digital transformation platform with its low-code capability, it has provided that unified and agile interface layer, streamlining all of these processes, and enabling this end-to-end automation of more than 150 different workflows and request types. That’s one. And quickly touching upon second one, which is, again, unique because this is a claims department where, prior to Newgen implementation, this entire department was using physical papers and folders and tens and hundreds of pages going from desk to desk, everybody annotating on that paper with the markers, highlighters, using Post-its to put their notes and those kind of things. That was the world in which this claims department was living in.

And then when we came in, and we said that, “Hey, we can do this digital transformation,” there were skepticism within users saying that, “Hey, we have been living with this physical world for years. We don’t see how you can mimic our processes in a digital environment.” And when we provided that interface where the users were now electronically able to do all of those things that they did on paper, making notes, putting those annotations, and to go a step further, to be able to put notes for themselves, private notes, and restricted published notes and generic notes and then annotations, same way. And now everything is available through search, almost like a Google search. You start searching whether that content is in one of the pages of the document or in one of the annotation or one of the notes. All of those things coming ergonomically in front of those users. So these are a couple of examples that I thought may be helpful for our audience to appreciate how Newgen platform has helped our customers. So with that…

Raj: Great case studies, Anurag. Yeah, fantastic. Yeah.

Anurag: Yeah. And with that, I think we are coming to our concluding part of the chat. And that’s where I wanted to ask you, Raj, how do you see Infosys’ and Newgen partnership helping these insurers? How do you see this joint value prop working here?

Raj: Oh, great question. I think we have a lot to offer to the clients as we come together. It’s a long-standing partnership we have, Infosys and Newgen, over 18 years. And Infosys has a very strong Newgen center of excellence. And both of us, as we saw during our discussion, right, we are very focused on this market segment, the midsize insurance market. While Infosys brings a comprehensive insurance-specific digital transformation capabilities, we also have an ability to quickly focus on results. And I think that is where working closely with Newgen as a platform, being able to implement it and being able to continuously build use cases on top of it and orchestrate all the digital capabilities with both the low-code, the content management, the data, I think it’s been an amazing capability for us to come together and help our joint clients to get to those business outcomes quickly. So I see this as a partnership, which is growing, which is creating a lot of value for our clients. And, Anurag, we thank you. And personally, I thank you for all the support we have had, and I think the best is yet to come.

Anurag: Of course, of course. And it goes without saying, Raj, I mean, this partnership has flourished, and our joint customers are testimony it to it. Multiple of these customers within insurance here in US and other parts of the world are live testimony. And just to add to what you just said, right, all those good things that you bring from Infosys’ perspective. And from Newgen, how do we contribute into this partnership for these midsize insurers is by bringing its product, the core product, the low-code, the content, the communication, those three pillars, bringing its architecture, architecture around these products, and last but not the least, hosted on the cloud. Whether it is, one, customer-hosted cloud or it is Newgen-hosted cloud or it is Infosys-provided cloud, all those permutation and combination, and then being an extended arm of Infosys’ team, to go through this entire customer program that you run for all these customers.

And yes, this has been a great partnership, like you said, best is probably yet to come. But so far, it has been such a wonderful journey. And looking at it from our customers’ perspective, I can safely say that I’m so proud of this thing, Raj, and we cannot thank enough to you and Infosys’ entire team and management in having this commitment and working with us in this. We really look forward to this.