Gregory Maciag

Mobile Insurance in Asia

Insurers in Pakistan are bringing life insurance to new markets via “branchless” financial services organizations operating by mobile phone. For example, subscribers to Zong Mobile can get 30 days' coverage between PKR 100k (about $1,000) to PKR 300k (about $3,000) for a daily premium as low as PKR 2 (one fiftieth of a cent, US). To put some context around that, according to Bloomberg http://www.bloomberg.com/slideshow/2012-08-13/highest-cheapest-gas-prices-by-country.html#slide52 the average daily income in Pakistan is $3.57. The service is delivered using just four text messages – and that's all.

The challenge in growing this market is not about technology but awareness. SMS (texting) technology is a perfect channel for life insurance sales transactions. It's not so good for sales education. There will need to be further investment in relationship management.

Another product mentioned in the review I read gives users monthly coverage based on the balance in their mobile bank accounts. This is a cool extension of an existing offering and a good way to promote money management.  I notice also that Zong Mobile is a business of China Mobile. The new mass markets for insurance are being built in Asia, and are based on mobile technology. The potential for innovation and growth is jaw-dropping.  Mobile Life Insurance

BYOD

Bring Your Own Device...  The genie is, once again, out of the bottle. With so many of us using and relying on smartphones and other connected devices, the line between personal and business equipment is blurring. CIOs and CTOs are struggling with the implications of BYOD – Bring Your Own Device. On the one hand, if staff pay for and maintain their own devices to do work, then that's a cool saving. On the other hand, such practices blow a hole in your security and support strategies.

I think decision makers have to attack this situation on two levels. There's a coverage level, whereby you need to make sure that BYOD habits don't break the terms of your cyber risk insurance. You might be able to achieve this with suitably worded BYOD contracts signed by employees. However, you also need to attend to the practical level of the situation. What can you do to strengthen security, ensure applications capability and block the creation of rogue applications?

There's no one-size answer, but the solutions lie on a familiar centralized/devolved spectrum. Ideally, you want all business-critical systems to be accessible only through thin client interfaces. You want to restrict data duplication on mobile devices to temporary, non-user accessible caches. And you want to block any data request that is not suitably authenticated.

It's not hard to imagine workable policies based on these principles. However I fear that unresolved poor practices hanging over from the dawn of the PC era and then the beginnings of the email era will be amplified by BYOD. We continue to let people copy and pass data sets in the form of spreadsheets, which is bad for the health and integrity of the organization's information resources. We also let people paste data in emails in the form of tables and slides – often thereby duplicating snapshot reports that quickly age.

BYOD policy making is a great opportunity to look afresh at all your data custodianship responsibilities, and to educate your people in safe stats.

Device Growth

The Consumer Electronics Association says that the biggest growth in device sales in 2011 were for tablets (up 222%) and smartphones (up 58%). They forecast 2012 growth of 59% and 22% respectively.

Of these two device types, smartphones have been around longer. They've traditionally been a high-end sale, and that market is reaching saturation (as are 3G networks). We're likely to see lower-cost smartphones emerging as suppliers try to enlarge the market. The upshot is that mobile apps are going to be a permanent feature of our lives and enhanced information services are going to be taken for granted by customers.

I wouldn't want to take bets on the tablet market. Apple's achievement with the iPad is remarkable but I guess we'd all feel more comfortable if it had some serious competitors. I'll be watching Amazon's progress with interest here – just as I'll be keeping an eye on Google.

Global Gadgets Biz

Mobil App World Widens

The always reliable and informative Insurance Networking News discusses a report from IDC about the impact of in-app purchasing. The market for apps continues its impressive growth, but the focus of this report is on the opportunities for sales and services that are initiated and completed from inside of running apps.

 I'm not 100% sure of the focus for insurers here. This quote from IDC’s Scott Ellison doesn't help any: “The user sustainability trifecta of social networking, location, and the cloud are now increasingly being supported by the business model financial trifecta of application store purchases, in-app purchasing, and in-app advertising.”

My guess is that the interesting opportunities for insurers lie in collaborative efforts with other providers of products and services. There must be enormous potential for an insurer to insert itself in, say, the process of buying an expensive, complex item. An app that helps you choose a vacation could feature a prompt for buying travel insurance, with the premium being shared by the insurer and the app host.

This doesn't sound a whole lot different than traditional sales partnerships. Travel companies and insurers already team up in this way. The difference that in-app service could bring is a greater degree of flexibility on the part of the partners. You could even call it the promise of promiscuity. The travel app host could switch its in-app insurance provider with a simple change to the call-out code.

This business switchability is a free by-product of the fact that for in-app services to have any hope of gaining traction, they have to be standards-based. The standard discussed in Pat Speer's INN article is Apple's Store Kit framework, so the assumption at work here is that Apple owns the market for apps. With Android growing strongly, developers will want to look at alternative technical standards as well.

The good news is that at the level of business logic - the code that performs the actual insurance process - standards are already in place. ACORD standards can be used as easily in-app as anywhere else. This is just one more area where the insurance community's investment in our standards contnues its rich payback.

 Insurance Networking News

Mobile Apps

Travellers has been analyzing its claims data and finds that the number of claims filed by mobile device has tripled in the first four months of 2011, compared to the same time period in 2010. According to Insurance Networking News: "Travelers found that 70% of claims filed through mobile devices related to personal auto insurance, 28% were personal insurance property claims and the remaining two percent were business insurance property claims (.5%) and business insurance auto claims (1.5%)."

Mobile devices are now firmly embedded in consumers' lives. It's becoming natural to turn to your smartphone for every need and eventuality in life - including insurance. What interests me about the breakdown of product types is the healthy percentage for personal property claims. You'd expect auto to be leading in the mobile channel, but maybe by an even bigger margin. The figures suggest that people are using their mobile phones for preference even in the home or yard. Insurers can't assume that the mobile channel is only for people on the move.

 Insurance Networking News

Micro Insurance a Mobile App

Here's an insurance application that is making smart use of cheap technology to get cover to farmers in Kenya. Twelve thousand farmers have already used the application to buy cover for seeds and fertilizer at risk of loss due to excessive rain.UAP Insurance plans to grow the market to 50,000 farmers this year, and to offer more insurance options.

Local agents use their camera phones to scan a bar code when they sell a policy. Policy confirmation is then sent to the farmer's mobile phone by text message. The company uses a network of 30 weather stations to determine payouts. These stations have been fitted with solar-powered transmitters, so the weather reporting function is fully automated. Finally, claims are paid using the M-PESA mobile money transfer service offered by telecom operator Safaricom – it's already a popular means of transferring money in Kenya.  This is an initiative that really deserves the label “innovative”.  Micro-insurance 

Insurance App Wars... For Real

Best's Review magazine has a cover feature on “App Wars” with the tagline: “Insurers vie for interactivity, usability and convenience for customers and producers on mobile devices.” Bests Review

It wasn't so long ago that people used to scratch their heads and ask why anyone would want to do insurance business on a mobile device. But now that so many people have smartphones and such like, the “mobile” part of the equation doesn't stick out so much. These devices aren't significant because you can carry them around, but because people do carry them around.

You see the difference? “Mobile applications” used to be a hard sell, because few consumers or business decision makers could envision the lifestyle that would make them relevant or attractive. Well, that lifestyle shift has happened. Fact is, you can no longer assume that your customers or partners do business in the old way of sitting down at a desk, and rolling their sleeves up. People do a lot more transactions with a lot more organizations than they used to, and they do it around the clock, to fit in with their busy lives.

I  guess the shift in mindset really happened when “app” moved from the techies' lexicon to the general vocabulary. We have Apple to thank for that. It's ironic that while their direct impact on business IT has been minimal, the indirect effect they're having via this cultural change is immense. Some people even think “app” is short for Apple, and that Steve Jobs should be working harder to protect his intellectual property around the name!

I'd like to see some ACORD Forms on tablets... like the one I created 15 years ago... to an overwhelming industry yawn. Somehow, I feel somehat redeemed today.