Contact person: Ran Guo
Email address: [email protected]
Contact number: 18221991443
Asia and ANZ
The Digital Insurer Startup InsurTech Award
Dear Digital Insurer:
I make the case for my team with great pleasure and excitement. What we have accomplished in the past 6 months is truly innovative and first of its kind.
Premium Growth in China and regulatory undertone.
It is important to note the current regulatory environment in China is advancing rapidly underscored by the desire to “open” up. For example, the insurance regulator and banking regulators have merged to form CBRC, foreign brokerage firms can now compete in all line of business instead of a limited subset, the auto premium in 3 provinces (Guangxi, Shanxi, and Qinghai) can now price freely. On top of regulatory changes, direct premium is growing close to 20% a year.
What are insurers doing? As insurance penetration increases in China, premium growth is still the most important KPI and most insurers are working to grow organically.
Given the rapid growth, insurance company are in a feeding frenzy trying to snatch up premiums volumes. Heavy handed investments are observed in direct channel particularly online, AI technology, big data analytics. With the help of mobile payment, the quote to bind process is lighting fast and protection is just a few finger swipes away. The organic growth combined with the softening regulatory environment is creating the perfect storm for insurance technology innovation.
What are the pain points for insurers? Outdated infrastructures together with new demands for services capability and rapid changing products are causing big service gaps for insurers.
Given the rapid expansion in premium, many insurers are faced with the challenge of providing first of class services. Customers are complaining about slow turn over time as claims adjusting sometimes take weeks, and it’s rare to get a real customer service to resolve an issue. It is a well-known secret in developed markets that claim net promoter score (NPS) is the number one driver for renewal rates, a bad claim experience can build distrust and tension between insured and the insurer and the impression once created is very difficult to change. But with the big-ticket investments going into premium generating activities, the operations team are left with little resources to solve a big problem.
What PuYing offer and why it deserves to win.
PuYing’s mission is to help insurers bridge the services gap and create a best in class claim experience for the customer. We started this path by tackling the LOB with the most pain points, health insurance. Health insurance is a newer product in China that has gained in popularity in recent years as people start to seek insurance on their most important asset, health. Currently, the claims services for health insurance are very much a manual process, with little automation and software support. The result is an inaccurate, slow claim process that is laden with human errors and a large labor force that isn’t well suited for the cyclical nature of the claim volume. Puying is a joint venture between a EIS Group a US software company and 3 Chinese entrepreneurs who saw the potential in EIS’s software and had a vision on how it can be adapted to solve the claim services issue in China.
What PuYing created in China is built on top of the EIS software platform but with a tremendous amount of adaptation. The system is now capable of a through put of 10 thousand claims per minute of which 80% or so passes the risk control procedures and are adjudicated automatically. The entire process could take as little as 10 minutes and the claimant usually receive the claim indemnification the same day. This is a 10x improvement over the current experience. To achieve this result, we combined EIS’s product factory with direct data access to the hospital, resulting in a quick product deployment and rapid data connection. The benefit of automated adjudication process is also built on top of the confidence that a sound risk management system is in place to filter out claims with fraud potential. This is also an area that Puying scores high on, in a model competition hosted by Alibaba Puying ranked 3rd out of 1336 teams in our fraud detection model. Our technology has taken the market by storm evidenced by our hit ratio of 100%, as in every insurance company we have spoken to are interested in procure our services. In the past 2 month, Puying also worked to further simplify the way to enjoy our services by rolling out a CaaS platform where insurers can simply connect to a standard set of tools and APIs to enable their claims.
We believe the health insurance claims services is only the beginning. There are vast number of innovative products that need to be supported by best in class claim services. The direct written premium in China has reached 3.6 trillion RMB and a loss ratio of roughly 30%, if ALAE is only 5% of the premium that would be a market size of 160 billion RMB.