While Digital Process Handle Efficiency, Human Interaction Is Necessary For Empathy: Manu Lavanya, Max Life Insurance

What changes have you observed in the last three years?
When I joined Max Life in January 2020, the first significant change was the rapid adoption of remote work due to COVID-19. In the insurance industry, which heavily relied on in-person meetings between advisers and customers, we had to quickly digitise many processes to enable remote business operations.

Digitalisation and digital consumption have increased significantly. Approximately 16% of our policies are now purchased online, up from 11% three years ago. Customer self-service using digital tools has also risen from 55-60% to around 84%. Additionally, there has been a focus on enhancing risk management and underwriting with the help of machine learning and analytics.

How has Max Life adapted to changes in its operations and customer engagement?
Max Life has put in a lot of effort in the last two years to automate and digitise operations. We've built a technical solution with API-based platforms that allow us to onboard new partners quickly. Partner onboarding now takes only two to three weeks, compared to several months in the past.

What about penetration in rural areas?
Rural penetration has been steady, with around 27% of our business coming from rural areas. Initiatives like "Bima Vahak" and "Bima Sugam" are being introduced to further drive penetration in rural areas. The regulator is also supporting this effort, and specific strategies are being implemented to reach underserved regions.

What insights can you provide from an underwriting perspective?
From an underwriting perspective, we've seen the importance of leveraging digital tools and analytics to enhance risk assessment and management. The increasing use of data and technology has allowed us to make more informed decisions in underwriting, improving efficiency and accuracy.

The underwriting efforts did not see significant changes during this period. They emphasized the two critical aspects of underwriting: assessing mortality probability and financial wellness to pay. The mix of policies may vary, but there was no mention of substantial changes in the underwriting process itself.

Can you provide an overview of recent initiatives and strategies related to claim information?
Claims Paid Ratio is a key metric used in the industry to measure the ratio of claims paid to total claims. Max Life has consistently been a leader in this metric for the past four years, with ratios consistently above 99.2%.

Calculation of claims paid ratio: this ratio is calculated over the entire year to avoid distortions due to work in progress (WIP) at year-end.

Underwriting Efforts: Max Life has invested in analytics and machine learning to enhance underwriting, reduce the chances of claims being questioned later, and prevent fraud.

Efficient Claims Processing: For non-early claims, which are claims made on policies older than three years, Max Life aims to process claims as quickly as possible, with about 75% of these claims paid on the same day. For early claims, they investigate only about 25% or less of cases.

Intelligent Systems: Max Life uses intelligent systems to detect fraud, identify high-risk geographies, and assess the probability of false claims based on non-disclosure.

Document Analysis: The company employs smart algorithms to extract information from various documents to check for pre-existing ailments and other key factors.

These are some initiatives related to claim settlement that has been taken by the company towards both swift claims processing and thorough due diligence.

How does Max Life use intelligent systems in underwriting and claims processing?

Max Life uses intelligent systems in several ways.

Fraud Detection: They employ algorithms that can detect fraud and impersonation at medical test centres. This helps identify if medical diagnostic centres are altering test results.

Geographic Risk Analysis: Max Life identifies geographies with higher fraud risk and adapts its approach accordingly.

Document Analysis: We use smart algorithms to extract information from various documents, such as physician records, to check for pre-existing ailments and other factors that might affect claims.

Face Matching: Max Life uses face matching to ensure that the person who applied for a policy is the same individual who underwent medical tests or was recorded in verification videos.

Automated Governance: The system provides real-time checks for underwriters, flagging conditions that may pose risks and requiring confirmation before policy issuance.

These systems enhance the efficiency of underwriting and ensure that claims are processed accurately and swiftly.

How is technology affecting the insurance industry, and is it reducing the number of employees in the field?
Technology is indeed reshaping the insurance industry, but it's not necessarily reducing the number of employees. While digital tools enhance efficiency, there are aspects of insurance that require a human touch. For example, customers often seek empathy and trust, which digital tools are still working on. Additionally, not all customers are digitally savvy, and insurance companies must cater to various profiles. We have adopted the technology immensely while maintaining a zero attrition rate. Embracing technology doesn’t mean we need to remove manpower.

Is technology helping to reduce instances of misselling in the insurance industry?
Yes, technology has significantly reduced the instances of misselling. For instance, video point-of-sales verification ensures customers fully understand policies. Advanced technology prevents fraud during sales. However, misselling prevention is just one example; technology is also improving customer service and claims processing.

How does technology maintain a balance between digital processes and human interaction in the insurance industry?
The balance is critical. While digital processes handle efficiency and automation, human interaction is necessary for empathy and trust. Many customers still need a human conversation, especially when making important decisions like surrendering a policy. The goal is to combine digital efficiency with human empathy, as one can't replace the other.

Does Max Life Insurance offer digital training to its employees, and how does it prepare them for technological advancements?
Max Life Insurance focuses on enhancing digital skills and learnability in its employees. The operations, digital, and technology teams report to the same leadership, ensuring alignment. Additionally, the company offers various training, certification programs, and partnerships with external organizations to keep its employees updated with the latest technology.

What changes are expected in the insurance industry, both internationally and domestically, in the next three to five years?
In the coming years, several changes are anticipated. Regulations have become more positive, enabling innovation. Digital adoption will continue to grow. Moreover, customer-centricity will play a pivotal role in shaping the industry. The key will be providing customers with personalized, seamless, and accessible insurance experiences.