With the COVID-19 outbreak, life insurers across the globe have witnessed an acceleration of a digitally enabled model of distribution. V. Viswanand, Deputy Managing Director, Max Life Insurance, shares in this article how life insurers can transform into a new-age digital hybrid sales distribution model post COVID-19.
Since the pandemic, remote operations have put into focus concepts such as omni-channel phygital, hyper-personalisation and on-demand offerings. These are words that are rapidly making their way into the lexicon of the largely physical world of distribution in the life insurance industry and set the journey for the adoption of hybrid models.
A hybrid distribution model is one where agents are equipped with a full set of digital capabilities enabling them to interact with customers via a seamless omni-channel journey.
At the core of this phygital transformation is enabling agents to complement their hi-touch physical presence with hi-tech digital.
Agent advisers have always played a very critical role in life insurance awareness and generating business where customers have cherished the personal contact, bonding and relationship.
However, the need of the hour for new-age digitally adept life insurers is to transition from a predominantly face-to-face set-up to a hybrid digital model to operate in a post-pandemic world.
Industry players will now seek a mix of digital and traditional as they invest in re-orienting their distribution strategy in the post pandemic world. The adoption of automation, analytics and even artificial intelligence will be critical to the technology stack of a digital distribution.
In my opinion, there are four strategic pillars to consider as traditional life insurers begin to transform themselves to the new-age hybrid distribution model.
1. Redefine the agent value proposition
The hybrid digital model will call for a long-term shift in the role of the agents. From merely being the friendly neighbourhood salesperson, they will have to take on a greater role of a financial adviser and demonstrate knowledge of not just insurance products and offerings but also advise customers around holistic financial planning as per financial requirements.
Agents will also have to be fully enabled for digital and offline selling because the consumer’s urge to going online is an unstoppable force.
To enable agent advisor to take on this wider role, life insurance companies must redefine the agent’s value proposition. This would involve re-evaluating the way they reward agent advisers and recognise them for not just acquiring new customers but also for providing sound financial advice in the new era.
There is also significant scope to modify the extant processes and experiences, make products and onboarding more compliant for sales and service, and perhaps even recreate the effectiveness of an in-person, advice-based exchange between agents and customers in a virtual environment. (Read more)
2. Identify new technologies and digital tools to empower agents digitally
Increasingly, digital offerings in the life insurance space are becoming a catalyst for driving customer-centricity. Life insurers are therefore required to foster the latest technology that can help improve outcomes and make offerings more engaging for policyholders.
By identifying the hurdles that currently challenge agent-customer interactions and rapidly resolving those with tech-enabled solutions, life insurers can develop a road map and close the productivity gaps effectively.
Digital tools can help make customer onboarding smoother, simplify underwriting, claims processing and bring about greater transparency that can create value for both agents and customers. Agent advisers must also be virtually trained to use the digital tools at their disposal effectively.
3. Enable self-directed distribution
The growth of a tech-addicted customer base of millennials is resulting in a focus on the ready availability of advice and transaction capabilities through the online channel.
This distribution approach relies on engaging the user, ensuring comfort, providing convenience and encouraging independent decision making and self-service. The approach leverages data from diverse sources in real-time to offer a personalised experience.
Insurers must innovate to make this a win-win for the consumer and the agent adviser, rather than ignoring the elephant in the room.
4. Invest in robust learning and development
Life insurers should invest in blended learning for their agent workforce, including virtual classrooms, micro-learning content and self-assessments. And the context of learning and development should broaden to involve both industry-specific knowledge, as well as developing generic entrepreneurship, people and technology skills.
There is often a sense among consumers that agents are “always trying to sell products.” This points to an area of opportunity.
Companies should focus on creating relevant learnings for agents in the post-pandemic era such that agents are able to identify customers’ financial needs meaningfully and offer life insurance solutions in a trustworthy and beneficial manner.
In the post-COVID-19 world, new-age insurers will have to explore how a mixed distribution model with some agents being in the field, and others at home, will impact the overall business.
While changing the distribution operating model will take time and courage to implement, life insurers that start working on these longer-term imperatives today will lead in the next normal.
An industry veteran in the financial services sector for nearly three decades, V. Viswanand is Deputy Managing Director at Max Life Insurance and a member of the Board.
Under his belt, he is responsible for Distribution, including Proprietary Channels, Bancassurance and Third Party Business, Institutional Sales, Business Development and Distribution Operations.
He steers the strategic direction and growth of the company and leads the Max Skill First training partnership as well as the Procurement and Facilities functions.
He played an instrumental role in not only propelling the company to emerge as the industry leader in Customer Retention, Claims Paid Ratio and Customer Loyalty but also had led the Company’s wins in several global and national accolades in Quality and Technology, including the coveted Gold medal at ASQ, USA and RBNQA.
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