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Following the recent announcement of Kenny Thing as the general manager of U for Life, Computerworld Malaysia asked him for a quick pulse check on the state of online insurance services today and how he sees the industry evolving beyond the current 'hype' of emerging technologies such as artificial intelligence (AI), block chain and telematics.
And as Thing said that U for Life is Malaysia's first online life insurance service startup, we asked him to include some background behind its debut in the following lightly edited transcript of a 'rapid fire' QA interview.
Photo - Kenny Thing, General Manager, U for Life
Taking Malaysia as a 'case example,' what are your thoughts on the business outlook of insurance technology within the next five years?
- The digital economy is fast moving. Online insurance provides a simpler, instant and affordable experience. Whether personal or business, having an online platform enables customers with easy access to their life policies.
- It has been FinTech in the spotlight till the emergence of InsurTech recently. And this is where U for Life comes in as the first online term life insurance company to make a debut in this country.
What is the next phase of insurance technology?
- There are talks about the ABC i.e. Artificial Intelligence, Block chain and Connected Health (telematics) alongside the concept of sharing/on demand economy and P2P. A lot of development going on but we should see some consumer friendly use cases past the peak of these hype
What are some of your insights on insurance technology, and how it provides convenience to customers today?
- If I were to ask 10 customers today about their insurance policy, high chances are 5 out of 10 will not be able to explain or know about the policy details.
- The point here is - our online platform enables customers to understand the life insurance policy they purchase, what they are paying for and the benefits that it will bring - thoroughly.
- There is no sales agent in between. The customer gets to read the policy, understand how it works and provide every piece of information just by a click - this will enable customers to buy a policy tailored to their needs.
Can you share detailed analysis of trends and the changing face that shape the insurance industry in the country?
- As mentioned previously, a digital society is fast emerging and ever-evolving. The need for various companies to move towards the online space is building up, and buying insurance is one of those fast moving trends. Also, we are supporting of the Malaysian government's drive to embrace the digital economy with our move. This will also help close the protection gap. Now is the time to create dynamic online services and segments, such as U for Life, which provides consumers with a convenient option to purchase term life insurance online.
- It is easy to find, low priced services with online end to end platforms. Customers should be able to log on to a website, register and the policy or service can be emailed to them. In today's day and age, pace is everything. We want things quick and easy.
How do you think emerging technology will further change financial services in Malaysia/and Asean in the next few years? In what ways are customer's behaviours changing in this part of the world?
- Digital insurance Products are most likely to be a common goal for many startups especially when consumers are so empowered in this digital era. With that, comes the need for existing insurers to embrace the emergence of new technology and to be more collaborative with InsurTech players.
- As an online insurance platform, U for Life, utilises digital distribution using a smart Underwriting Engine by Intelligent life. This allows the immediate distribution of our term life insurance, making it more convenient for consumers to be protected financially.
Talking further on the business of starting up U for Life: What is the inspiration behind creating the first online life insurance company in Malaysia?
- It is all about the right time frame and era we are in. Today, we live in a digital world where there are new ways to reach out to customers to provide them with a solution for life protection. Purchasing an online life insurance should be made easy and simple to understand, as well as affordable. Customers today look at two important factors when making a decision - quick and affordable. To meet those needs, U for Life was launched. As I said, we are the first in Malaysia to launch an online insurance platform: it's a great milestone.
How long did it take before the idea successfully rolled out?
- It takes time for a company to understand this industry and also invest in the proper technologies before making a debut. U for Life took about 12 to 15 months to establish its presence in Malaysia, officially last year (2015).
What are plans for the company?
- To continue to work closely with our partner life insurance carrier Tokio Marine Life Insurance. Having a strong trusted brand like Tokio Marine Life Insurance helps a lot as we are still relatively a new brand here in Malaysia.
- To continue to build on our Digital Distribution and reach out to our target customers. Partnering with other FinTech players is a key part of our growth strategy.
- Enhancing our product range and our platform as this is the place where customer do their transaction and we want to ensure a smooth checkout experience alongside with more options.
For customers, what is the process from registering to approval status?
- Customers need to perform a quick quote process if they are happy with the indicative premium rates.
- Questions will then be asked online and the responses are processed by our Underwriting Engine with a final set of premium rates
- Click the payment button and the policy will be delivered to your inbox.
Do you have underwriters at the back-end?
- Our underwriting is performed by our online Underwriting Engine at this point, we have only 2 percent decline rate due to specific health issues, while 98 percent are approved straight through.
Is there a local support by Intelligent Life?
- This is an online platform; technical support is available 24x7. Customer support is available on the site via live web chat and WhatsApp
How many policies have been sold thus far?
- For strategic reasons and the company's policies, we cannot divulge information on the specific figures. We are more focused on getting the life insurance product to as many consumers as we possibly can, and the fact that sales are done directly through our online platform shows the willingness of Malaysians to purchase the insurance product online.
Are the new customers mainly from competitors? Or are they customers where they never owned a life insurance policy?
- We have a variety of customers: 60 percent of our customer base fall between the age group of 18-35 years, where most of them fall under school goers or fresh graduates who do not own a life insurance, to working class adults. This year, we see an increase of customers that fall under the age group of 36-44 years.
- We aim to expand our reach to a wider range of Malaysian demographics. As U for Life fits well in our modern digital society, owning a life insurance has been made convenient and affordable for anyone and accessible anywhere.
What impact will your online insurance model have on the Malaysian market?
- The future of insurance has become more digital. Online insurance provides a simpler, instant and affordable experience for consumers. Customers are immediately covered and issued with the e-policy instantly. Having an online platform enables consumers to buy a policy anytime. Also, U for Life has a live chat feature that allows consumers to enquire should there be any uncertainty or query.
- U for Life is about delivering convenience at an affordable price with an efficient online process, which suits our fast changing digital society.
- We see our business model complementing the existing traditional Insurance Distribution model and it is more collaborative than disruptive as element of trust is very important and we are glad to work with a partner with a strong trusted brand like Tokio Marine Life Insurance Malaysia.
Being the first online life insurance company in Malaysia, how does U for Life leverage the insurance technology to cater to this digital era? Is U for Life mobile friendly?
- In this digital era, U for Life created the first online life insurance platform to cater to the needs of our modern mobile generation. We provide them with a more convenient yet affordable life insurance application process, as our savvy mobile friendly website incorporates tech insurance characteristics.
- Our website is mobile optimised.
Do you plan to develop a U for Life app for mobile devices?
- Yes, this is already in the process and will definitely provide an update in due time
How would you compare U for Life to your competitors from a technology standpoint?
- U for Life is the first and only online life insurance platform in Malaysia. We have a small pool of industry friends who share similar platforms, however their focus is not on life insurance. In fact, we are expanding our product suite to provide more options with a greater convenience to our customers.
What were some of the success and innovations U for Life has faced to-date, and what were the challenges faced since its establishment?
- We are the market leader in terms of online distribution of term insurance. To date, we have underwritten more than RM500 million (US$98.93 million) of pure protection business in this ROPO segment a significant milestone for us
- About 98 percent of our customers will get some form of coverage when they use our platform, powered by our UW engine.
- This segment is relatively unknown given that insurance products have traditionally been sold rather than bought with the challenge of finding the right mix of digital and traditional marketing.
- Lastly, the continued education of getting protection online and we have to demonstrate to our customers that insurance purchase process can be simple, fast and affordable.
Isn't U for Life competing against existing insurance agents?
- Competition is always good for the industry as the main goal is to get more Malaysians adequately insured at the end of the day.
- Therefore, we would want to increase the penetration rate of consumers with insurance coverage from 50 to 70 percent - it is important to have more options for the customers to choose from.
Will U for Life be going into other countries? If yes, when will that take place?
- The company is currently focused on building our strategic partnership with Tokio Marine Life Insurance here in Malaysia. We are keen to take a look at any strategic opportunities should they prevail.
- At the end of the day, it is all about what the customers want and we will continue our focus on getting them the best products that there is to offer.
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