Insurance companies must embrace multi-stack innovation as the global digital ecosystem grows: Arun Balakrishnan, Co-Founder & CEO, Xceedance

The insurance sector in India is among the premium sectors that is witnessing growth. According to India Brand Equity Foundation (IBEF), India is the fifth largest life insurance market across the globe, witnessing a growth rate of 32-34 percent each year. The technology could be attributed as the engine driving the growth of the insurance sector. In the present-day scenario, cutting-edge technologies like robotic process automation, artificial intelligence, data analytics, low code/ no code solutions have transformed the entire landscape of the insurance sector in India.

In an exclusive interview with Express Computer, Arun Balakrishnan, Co-Founder & CEO, Xceedance shares his insightful views on how advanced technologies are transforming the insurance sector in India.      

Xceedance was set up with the vision to disrupt the services landscape in insurance. To what extent have you been able to bring in the change and transform the insurtech industry?

Xceedance was founded in 2013 to leverage in-depth insurance knowledge to support all aspects of the insurance lifecycle. Xceedance prides itself on having a deep knowledge of how the industry works and an understanding of the challenges facing insurance professionals. Our team works with insurers, reinsurers, agents, brokers, and program managers to increase operational efficiency. As insurance is the only industry we serve, our team leverages extensive insurance and technology expertise to cover risk management, actuarial requirements, underwriting, policy administration, and claims processing and then finds new and innovative ways to automate and streamline insurance lifecycle functions.

Xceedance is headquartered in Worcester, Massachusetts, USA, and has nine locations worldwide, including four locations in India. The company is experiencing employee growth of over 30 percent annually. With over 2,600 team members, 138 client partners, and over 250 ongoing insurance operations and technology engagements, Xceedance helps insurers launch products, implement intelligent technologies, deliver advanced analytics, and help optimize business processes. Xceedance provides technology that has the greatest impact on the insurance industry, including artificial intelligence (AI), analytics/big data, robotic process automation (RPA), machine learning, and low-code/no-code technology.

What technologies are you leveraging to facilitate, automate and optimise insurance lifecycle functions? How has this been instrumental in boosting the company’s operational efficiency?

In the era of digital transformation, insurers are utilising data and technology to develop distinctive consumer experiences. Insurance companies must choose whether they want to take the initiative or stand by and observe as client demands and expectations change. Insurance companies must embrace multi-stack innovation, which mixes and enhances many digital technologies, as the global digital ecosystem grows.

Our solutions leverage the following technologies making a big impact on the insurance sector:

Artificial Intelligence (AI): Insurance firms benefit from AI by streamlining essential strategies, increasing productivity, and improving customer service across all client touchpoints. Insurance companies will be able to better understand their customers with the help of this technology, opening the door for tailored product and service offerings, pricing, and faster service delivery. 

Data Extraction: The selection of risks, administration of policies, underwriting procedures, claims, analytics for loss modeling, evaluation of insured assets, and regulatory reporting can all be enhanced with better data access. Strong data extraction models can be produced using IPA (Intelligent Process Automation), NLP (Natural Language Processing), and ITI (Intelligent Text Ingestion) technologies.

Robotic Process Automation (RPA): RPA makes it possible to automate repetitive but complicated procedures and tasks, which frees up resources for more strategically important work, boosts throughput, decreases turnaround time, and boosts the overall efficiency of insurance operations. It enables the automation of the claims workflow and the processing of documents, improving timeliness, effectiveness, the ability to assess the risk of retention, and real-time access to customer information.

Big Data/Analytics: Insurers may create meaningful consumer interactions in distribution, claims processing, and customer services by securing both unstructured and structured data for analysis. Advanced analytics can be used in actuarial practice to establish premiums, manage portfolios (including propensity analysis and loss prevention), and assess and estimate unpaid claims.

Low-Code/No-Code 

Low-code/no-code technology is ground-breaking because it makes it possible for non-programmers to develop applications more quickly than with the conventional method. This provides companies with countless options for designing and managing software applications and insurance products, including networking, connectivity, and rating algorithms. By automating tedious procedures, streamlining workflows, and accelerating returns from new goods and services, they can assist firms in achieving operational excellence and narrowing the gap between expected and actual performance.

Each of these technologies will enable insurance companies to achieve better client interactions, improved connections, and streamlined/more efficient procedures.

In your opinion, how is the insurtech sector shaping up in the coming five years? What areas can pose to be a game-changer?  

The pandemic has pushed India’s cultural shift toward online and digital activities. Insurtechs were already well-positioned to gain from this pressure, thanks to their digital attributes. Some areas which are proving to be game changers in the insurance lifecycle are:

Embedded insurance: At the point of sale, embedded insurance combines insurance with the purchase of a good or service. It can be either a hard package (where additional money is added as a guarantee) or a soft package (where the buyer must deposit a small sum of money but has the option to decline). No matter how the offer is structured, embedded insurance is a clear solution for addressing the coverage gap and making insurance better available.

Artificial Intelligence, Internet of Things, and Machine Learning in underwriting: The insurance industry in general is moving away from traditional, one-size-fits-all ways of underwriting risks and moving to more personalized risk assessments. This transformation is taking place at the intersection of artificial intelligence (AI), Internet of Things (IoT) devices, and machine learning (ML).

Tailored product bundles and hyper-personalisation: Insurtechs have now started combining several insurance products by evaluating personalised risks based on demographics, geographies, and habits. It has become imperative to offer insurance against specific risks rather than stuffing the insurance product with lots of add-ons to increase premiums.

Penetration in tier 2 and tier 3 markets: Penetration of insurance, especially health insurance, in tier 2 and tier 3  markets will triple. With easier KYC and customer profiling, there is also some innovation in payment modes – where monthly or even daily payments have been tried with some success. 

Claims and customer service automation: Insurtechs typically come with a digital DNA that is pervasive in all operations from day 1, including claims and servicing. Digitised claims, with 24-hour turnaround, are now the expectation for most policyholders. This is forcing traditional insurers to change how they operate and invest in technology and partners to catch up with insurtech and consumer demands. 

 

How Xceedance will be contributing to the changing insurtech sector in India in the times to come?

India is the second largest insurtech market in the Asia-Pacific region, accounting for 35 percent of the US$ 3.66 billion invested in insurtech projects. In the coming years, further partnerships between insurtechs and insurance agents will lead to increased insurance penetration, especially in areas outside of major cities. This will further help develop modern and customised insurance products for different customer segments.

We at Xceedance are always innovating and coming up with technological solutions for the betterment of the entire insurance ecosystem. We will continue to focus on data-driven product development, reducing customer acquisition costs, and accessing untapped markets.

What clientele does Xceedance cater to?

Xceedance is a global provider of strategic consulting, managed services, and technology for insurance companies. Our team works with insurers, reinsurers, agents, brokers, and program managers to increase operational efficiency. 

We leverage our extensive insurance and technology expertise to facilitate, automate and streamline insurance lifecycle functions including risk management, actuarial requirements, underwriting, policy administration, claims processing, and treasury. Technology is fundamentally changing the way insurance works, and companies like Xceedance are leveraging new technologies and approaches to drive this change by finding ways to integrate solutions such as robotic process automation, artificial intelligence, and machine learning into their insurance operations.

We are proud of our track record of working with insurance organisations of all types across global insurance markets. For some clients, this translates to project-driven work, where we work with them on a specific, often short-term need, and help them develop and deploy the right solution. For others, we work with them on an ongoing basis, essentially becoming an extension of their in-house team. We provide tailored solutions to cater to the specific needs of the clients.