46 Asia Insurance Review April 2017

C over Story InsurTech: Innovation, DisruptionDistraction?

The disruptors
With insurance named as the industry most affected by
disruptive change, Asia Insurance Review speaks to three
of such disruptors/startups as they share their unique
propositions for the insurance industry.
By Ann Toh

Scaling up
Ms Rosaline Koo, CEO of Singapore-based InsurTech startup CXA,
knows that in order to compete with the big boys in the employee
benefits brokerage game, her three-year-old venture cannot afford to
stand still.

A
lready the big sister in Asian
InsurTech, having revolution-
ised the employee benefits
industry by allowing employees to
choose a mix of insurance and wellness
benefits that best suits them, Ms Koo
is working on solving her customers
next pain point: double-digit increases
in premiums that outstrip revenue and
salary growth. This she plans to do by
working with insurers and reinsurers
to pre-negotiate reduced premiums,
conditional upon companies employ-
ees improving their health.
Improving employee health and re-
ducing premium is now our next goal,
said the industry veteran who used to
run Asias largest employee benefits
broker, Mercer Marsh Benefits.
Ms Koo believes that reducing the
root cause of why employees make
a claim against her original intent
of controlling her customers cost by
just capping premiums using defined
contributions fixed budget is a more
sustainable solution.
This is because combatting wors-
ening health and chronic diseases
through incentivising employees to
lose weight, lower cholesterol, con-
trol glucose levels, or participate in
diabetes management programmes,
through team competitions and re-
ward programmes, drives behaviour
modifications that ultimately improve
health and lower claims. The solution
will be piloted with several customers
in April 2017, and then introduced to all
companies on CXAs platform.
An ecosystem for health and
wellness
If CXA solves this pain point, the
US$100 million startup will be the
first employee benefits broker to suc-
cessfully help its clients achieve lower
premiums. Ms Koos keys to the king-
dom? Being able to capture a trove of
data (from claims to health screening
results to lifestyle and sensor data from
wearables and medical devices), and
the clout to convince her ex-clients of
over 10 years to move in this direction.
CXA has amassed a clientele of 500
accounts, out of which 45 are Fortune
Global 500.
Data is captured and stored in a
data warehouse built and managed by
CXAs team of machine-learning arti-
ficial intelligence data scientists and IT
experts, who make up a quarter of her
200-strong staff strength in Singapore
and Hong Kong.
We are integrating insurance with
claims data, biodata, sensor data and

CS-InsurTech-3Interviews-AnnToh.indd 46 23/3/2017 8:56:12 AM


C over Story InsurTech: Innovation, DisruptionDistraction?
lifestyle habits, said Ms Koo, so that
we can give employees personalised
recommendations on relevant in-
surance coverage and what to do to
improve their health. Firms can also
reward employees if they lose weight,
lower their blood pressure or win team
challenge competitions. And all of
these data will be captured in a wear-
able device.
CXA believes its platform is its
crown jewel the ecosystem that
will aggregate employees, insurance
providers, hospitals and panel clinics,
as well as disease management and
wellness vendors such as gyms and
yoga studios.
e are digitising every single
process so that we will become the
ecosystem for employees to perform a
Reinventing fundamentals
Chinas TongJuBao wants to throw traditional insurance concepts to
the wind as it furthers its goal of protecting social communities and
advancing users interests. Mr Tang Loaec, Founder of P2P Protect
Group, the holding company of TongJuBao, elaborates in this interview.
I
n Tong JuBaos P2P model, cus-
tomers join social communities
or groups as members. They buy
units of protection after creating a
deposit account into which an adminis-
tration fee and a guarantee deposit are
paid.
Tong uBao offers three products
marriage (divorce) protection, child
protection for women, and ID loss for
young, white-collar migrant profes-
sionals. Its policyholders comprise
mainly married women with children
in their 0s and young professionals in
their late 20s.
The goal of such a model is to re-
solve users frustrations, allow users to
protect each other, and apply greater
fairness to pricing and claims, said
Mr Loaec.
And if that entails scrapping the
insurance model, it has no qualms
re-inventing protection from the roots
up . e dont care about insurance
but the users, said Mr oaec. In our
model, there is no con ict of interest
we do not profit when we reject a claim.
e also provide systematic and uni ue
transparency to each community on
CS-InsurTech-3Interviews-AnnToh.indd 47
whole host of insurance and wellness
needs, including storing their e-wal-
lets, enrolling for services, assessing
their health, shopping for insurance
and wellness services, taking part in
corporate health competitions, storing
their medical records and submitting
claims, she added.
Expansion plans
Ms Koo knows that speed is of the es-
sence in her ambitious plans to scale
her startup before any competitor
big or small catches up. That is why,
unlike her first foray into Insurtech,
As expansion mode outside of
Singapore and Hong Kong will not be
through acquisitions processes, but
through revenue-sharing partnerships.
She has signed a partnership deal
its monthly claim and acceptances
rejections.
P2P pioneer
Tong uBao, an early pioneer of 2
insurance, embodies the purest form
of the P2P model, with ideals Mr Loaec
believes even high-profile startups such
as emonade which he calls digital
insurance models with lots of chatbots
and do not meet. He thinks many
competitors have packaged behavioural
science technology to lead users into
buying their products and services
the antithesis of a pure 2 model,
which is to fight for users benefits.
In the adoption of 2 Insurance,
the problem is not the P2P but the
insurance. People are reluctant to
purchase insurance and many do it
only because it is mandatory. They
are o en encouraged to participate in
mandatory subscriptions or pushed to
tick a box to buy insurance bundled
with another sale. Most P2P insurance
models to date have not realised that
if they just duplicate insurance strate-
gies, they will be going nowhere, he
said.
April 2017 Asia Insurance Review 47
with Shanghai-based osun to extend
CXAs presence to three cities in China
in the second quarter of 2017, and
another deal with Howden Broking
roup. The latter owns brokerage
licenses in India, Korea, Indonesia,
the hilippines, Thailand, Malaysia
and Taiwan. A plans to expand
to these cities by une 20 , with a
view to integrating with local insur-
ers as well as health and wellness
providers.
This will allow her to respond to an
increasing number of requests from
CXAs Fortune 500 clients to support
their o ces across Asia. These invest-
ments, including a shared services
centre to support all the 10 cities, will
be funded with the US$25 million Series
B funding raised in ebruary 20 .
Mr oaec admitted that Tong uBao
also struggles with this conundrum,
and the company plans to relaunch its
user ac uisition model in the next six
months. As he does not think his model
is limited by geographical context or
cultural values, he plans to expand the
service to the US and France (under the
P2P Protect brand) to advance the value
of solidarity and reciprocal help that
is relevant in any market and aims
for ambitious and aggressive user-
build-up in those markets. e would
also consider Indonesia, Malaysia or
Thailand if approached by the right
local partners, he added.
Mr oaec said an example of a 2
model that could be tied to a countrys
cultural values is Taiwanese P2P in-
surance company Intercare owned
by Shacom.com Inc , which has the
distinction of being the only 2
company to sell life insurance instead
of general insurance. The company
provides life insurance for underserved
23/3/2017 8:56:14 AM
 48 Asia Insurance Review April 2017
C over Story InsurTech: Innovation, DisruptionDistraction?
customers who are too old or too sick
to qualify for it.
The importance of social tech
Social technologies are especially
crucial in the P2P insurance model. Mr
Loaec said that social technologies are
at the heart of its social meets finance
The insurers intelligence
engine
Indias Coverfox.com began life as a disruptor of insurance distribution
but Mr Devendra Rane, Co-founder and CTO, plans to tackle product
innovation in its next phase of growth.
W
hen e-commerce gained
traction three years ago, the
founders of Coverfox.com
knew the insurance industry stood at
the cusp of a revolution that could de-
mocratise the way insurance products
were sold and distributed in India.
Believing that India, with its huge pop-
ulation and technology talent, can take
advantage of InsurTech, Coverfox.com
was born to vest consumers with
the power of choice, and education
through unbiased advice on insurance
products.
Faster, seamless and more
transparent process
Three years later, overfox.com has a
shining report card to show. We have
achieved a faster, seamless and more
transparent process for customers to
buy insurance online while getting
educated about product features, mak-
ing insurance a less feared term, said
Mr Rane.
Customers can insure their cars on
Coverfox.com in seven minutes and
their two-wheelers in four minutes.
About 80% of Coverfox.coms bike
customers insure their vehicles on the
online platform without intervention
from an adviser.
Its customer base has also grown
by leaps and bounds. Presently, 30,000-
plus policies are sold monthly, a huge
jump from the 11,000 a month sold at
end 20 . The number of insurers has
also grown from 17 in 2015 to 35 in
end 2016, and over 100 products and
CS-InsurTech-3Interviews-AnnToh.indd 48
model where building communities of
users that share risks, talk to and help
each other, are more important than
amassing client bases.
That is why we focus our customer
acquisition channels on social media,
using them not only as communication
platforms but channels to build social
insurance plans across verticals are
now offered to customers, as against
0 plans in ecember 20 . The site
has also added Travel insurance to its
suite of Health, Motor and Term Life
insurance products.
Mr Rane said his customers cut
across gender, age and geographical
divide. They have warmed up to the
value of insurance and banking prod-
ucts and services, and see a need for
better uality service, more e cient
systems and fewer processes.
Towards a more dynamic
product market
Having democratised insurance
distribution, Coverfox.com is eyeing
disruption of the product innovation
space.
Similar products are sold today
as 20 years ago and these products
have not kept pace with changing
risk profiles and landscape, said Mr
ane. The challenge that the industry
needs to address is innovating exist-
ing insurance products to make them
easy to understand, instead of simply
competing on distribution and brand-
ing, he said, citing hinas InsurTech
players as a good example of product
dynamism and innovation.
By collecting extensive data on
consumer behaviours over the last
three years, and having its team of
data scientists analyse consumer
interactions, Mr Rane plans to give
data-driven insights to help insurers
better understand customers insur-
links, seed groups and build up chat
volume. As compared to traditional
insurance multinationals, our strategic
differentiation is fre uency of contact.
If we build communities of people who
talk to each other and to us, we have
frequency of contact that can only be
dreamed of in the insurance industry.
ance requirements and work with
insurers to innovate and customise
product offerings.
It has created and is fine-tuning an
Insurance Intelligence ngine model,
which has uncovered interesting cor-
relations between consumers and the
premiums they pay, their brand a ni-
ties and propensity to claim.
India is a big enough market
Coverfox.com does not see itself
expanding outside India in the near fu-
ture as it believes the Indian domestic
market offers ample depth for further
innovation.
Insurance is an extremely large
segment and the InsurTech innovation
has only touched the tip of the iceberg
the retail sector. There are other
sectors B2B that are ripe for dis-
ruption. I dont think we are anywhere
close to claiming that the problem of
distribution has been solved. Insur-
ance penetration and awareness in
India is so low that new aggregators
will end up targeting niche segments
to grow and the industry will benefit
as a whole, he explained.
But while we see many more
aggregators formed, each trying to
disrupt distribution of various insur-
ance products, eventually, there will be
consolidation and a few large ones will
come out dominating the industry, he
predicted.
23/3/2017 8:56:20 AM