Established Insurer Seeks to Enhance Customer Experience And Grow Business Through FinTech
By leveraging Hong Kong's market potential, talent pool and supportive government policy, FWD hopes to make its new e-commerce platform a success and expand it to other markets in the region .
Buying insurance has always been seen as something one does only when it is absolutely necessary, much like a visit to the dentist's office. Other than the plethora of forms and paperwork, having to read all the terms and conditions in fine print is another aspect of it that makes it daunting. This ingrained idea, however, is about to change with the use of FinTech in the insurance sector.
In June 2015, iFWD, the digital arm of FWD Life Insurance Company (Bermuda) Limited, launched an initiative with the aim to not only change how things were done internally, but also to "disrupt" the insurance industry through the use of FinTech. The idea was that insurers could follow the example of the financial sector to enhance customer experience through technology. The company started building a mobile-first, Direct-to-Customer online insurance platform seeking to reinvent the customer journey.
"Hard-to-understand commercials and collaterals were replaced with a simple e-commerce website and targeted, tailored digital marketing," David Wong, CEO, Hong Kong & Macau and EVP Greater China of FWD, said. "Rather than filling out reams of paperwork, they could buy general and life insurance products in just a few clicks."
Hong Kong has been chosen as the hub for the pilot project, as it offers many favourable conditions.
"We selected Hong Kong as the innovation hub for our regional Insurance FinTech development because of the great market potential, availability of talent and also a very supportive insurance regulator," Wong said.
"We like the down-to-earth and practical implementation approach taken by OCI (Office of the Commissioner of Insurance) to encourage FinTech development."
OCI became an important partner of the project as having to tailor the often-cumbersome offline insurance-buying process for a streamlined online platform involved tackling complicated compliance and sales practice issues, such as anti-fraud and anti-money laundering measures.
"For example, the current offline FNA (Financial Needs Analysis) consists of tedious forms. iFWD team spent months of time to work with OCI to convert the existing process to a first-in-the-market interactive and gamified online module," Wong said.
FWD customers can now go through FNA online and instantly receive personalised product recommendations. They can also manage their policies, of both life and general insurance, with the eServices App, and even submit a claim request by taking photos of receipts and sending them through with a mobile phone. Customer service representatives can be contacted through Live Chat and there is the option to sign up for e-newsletters and updates.
To implement that project, the iFWD team was built from scratch and operates independently, akin to a start-up within the company. Under the leadership of Wong as the champion, there is a 20-strong team including four "leads" responsible for various functions. They also work with agencies around Southeast Asia for know-hows such as web development, e-commerce and digital marketing. The capabilities, once developed and proven, will be deployed to other FWD business units in different ASEAN countries.
The team employs an Agile approach in which prototypes are produced for customer validation and usability testing before a product is released to the public. Each product is enhanced every two weeks. This methodology has allowed the team to release a new product every month.
The results so far are encouraging. From June 2015 to June 2016, iFWD has achieved HK$100 million in Life APE sales, eight new products, 20,000 policies issued and 1.3 million visits to its website. The company hopes to grow the team to some 40 members by next year and expand the project to other markets such as Thailand, Indonesia and the Philippines.
FWD Group's business spans Hong Kong and Macau, Thailand, Indonesia, the Philippines, Singapore and Vietnam. It is owned by Pacific Century Group and Swiss Re.
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