China
42
Asia Insurance Review
July 2021
Data is an
opportunity
to create
better health
insurance
Pandemic-induced digitalisation
can be a game changer for
health insurance, especially in
a market like China where the
big numbers generate lots of
data that can help create digital
health insurance ecosystems
and a win-win situation for
industry and consumers alike.
axiusSoftware’s Mr Jayanta
Nandi takes a look at the
things as they are now and how
digitalisation and data can be put
to good use.
T
he pandemic has spurred rapid
digital transformations in
China’s insurance industry.
e shi from traditional oine
channels to digitalisation and online
channels to provide more exibility
to end-consumers is apace.
Insurers in China are now
working on how to usher in
greater automation through image
recognition, big data and data
analytics and smartphone apps
to streamline their underwriting
processes and deliver beer services
to their customers.
Online and ofine have to exist
together
Traditional face-to-face interactions
with the agents and brokers have
been the mainstay of life and
health insurance business in China.
However, with the pandemic and
social distancing norms, insurance
companies are now reaching
customers via online channels
and through web-chat and video-
conferencing.
e physical face-to-face
interactions with agents work more
on trust and relationships and these
play an important role, especially for
long-term insurance products.
For standard short-term products,
insurance companies are working
to have more direct contact with
end consumers. is hybrid mode of
sales engagement will not only keep
human interactions intact but will
also oer the end consumers the best
of digital values.
In the current pandemic
digitalisation has also helped with
health examinations for purchase of
life insurance products when in-
person health examinations for those
purchasing life insurance products are
dicult. Life insurers are collecting
data digitally through health
questionnaires along with medical
history records to work out the risk
class and the premium to be charged.
Digital health data is 24X7
Digital health data has the
advantage of access to more
information anytime, anywhere
on a continuous basis. is will
help the industry gradually make a
move towards smart underwriting
as insurers will now not have to
depend on data collected initially
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China
July 2021
Asia Insurance Review
43
Digital health data has the advantage of
access to more information anytime, anywhere
on a continuous basis. This will help the
industry gradually make a move towards smart
underwriting as insurers will now not have to
depend on data collected initially at the time of
purchase of the insurance cover.
at the time of purchase of the
insurance cover.
Digital health data, which has
surged during the pandemic, will
help insurers to make beer use
of advanced analytics and AI.
Availability of a person’s health
data at more granular level will
help insurers price the covers more
prudently, both for the customer and
for the insurer as well.
A major ‘benet’ of the pandemic
has been that digitalisation had
been happening at the insurer’s end,
however, now it is driving insurers to
involve end consumers as well to be a
part of the entire digital ecosystem.
InsurTechs provide easy
solutions for insurers and
customers
In the initial stages of the pandemic
in 2020 the Shanghai-based InsurTech
Ins for Renascence launched an
industry rst, the ‘zero-contact’
advance payment system for hospital
visits. e platform enables the
patient to authorise access to their
medical records, health information
and insurance plans through their
WeChat ocial account.
e Ins for Renascence platform’s
big data risk control model then
detects in advance the payment
to be made by the patient. e
patient then uses the fund to
pay the medical bills at hospitals
with a QR code. e medical cost
is subsequently reimbursed to
the platform by the insurer. e
individual does not have to use
cash or any other mode to sele the
hospital bills.
e pandemic has also seen
a surge in the number of end-
consumers seeking medical guidance
online. is trend is likely to
continue post-pandemic too. is
could spur such exclusive ‘online-
hospitals’ and insurers could have
specic tie-ups with such ventures.
e healthcare data that such
online hospitals would generate
would be of immense value for
developing beer data analyses.
Currently, Doubao, a Chinese
intelligent technology service
provider for the insurance industry
provides 24X7 free unlimited access
to online diagnosis for all common
ailments.
Health consciousness will grow
Another benecial eect of
COVID-19 may be an increasingly
health-conscious society, especially
patients in recovery. Some people
may be more amenable to change
their lifestyle and pay more aention
to their health. is could see an
increase in connected devices and
wearables, which would make
collection of lifestyle data more
convenient.
In addition, several healthcare
apps, many of them with an inbuilt
system of rewards, are now available
on smartphones and will encourage
users to share their health data with
the insurers. is trend, in turn,
will help insurers to collect more
data and analyse that data beer as
collaboration with the app-providers
can generate data in the desired
format.
Automated underwriting could
be the next phase
is may also help insurers gradually
to move towards automated
underwriting. e digital availability
of vaccine data will provide
exibility for the insurers in the
underwriting process and more so for
those with co-morbidities.
us the entire process of health
insurance underwriting may go
through a transformation and
insurers stand to gain from improved
eciency. Consumers stand to gain
by being involved with their own
healthcare at a much more granular
level with availability of professional
advisory services and also beer
priced health insurance covers.
Can support increase insurance
penetration
Digitalisation can also support
China’s insurance industry to tackle
the low insurance penetration
and poor awareness about the risk
transfer mechanism.
China’s insurance density and
penetration is still lower than the
global average. In 2019, China’s
insurance density was only CNY3,046
($475) and insurance penetration was
4.3%.
With increasing health concerns
and life risks due to the COVID-19
pandemic, China’s insurers need
to look again at how they can
enhance awareness about insurance,
especially in the lower tier cities.
Also, the pandemic learnings would
help the insurers to cover the hitherto
uncovered diseases. is will become
possible only due to the analysis of the
accumulated health data.
China’s insurance industry will
perhaps need to look at the positive
side of the pandemic and learn from
it. is is an opportunity for China’s
insurance companies to review their
business models, to work on building
an agile insurance system and a
roadmap to respond to such crises in
the future. Last but not the least, they
need to appreciate the value-added
importance of data and how it can
equip them beer.
Mr Jayanta Nandi is co-founder of axiusSoftware.
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