India becoming stronger on the other side of the pandemic

Digital transformation has various facets—ones that emerge from CX needs and ones that arise from the need to do things faster and better internally. Sumanta Ghosh, SVP and Head – Technology, Aegon Life Insurance, explains

How has your company been performing over 2022? Elaborate.

It was an important year for our company and the entire industry. We had just emerged from a Black Swan event with significant financial implications for all insurance companies. Nobody knew whether to expect another Covid wave. Nobody knew how Covid had shifted customer expectations and customer behaviour. So, it was a year when we were prepared for the worst, hoped for the best, and organised the team to be super agile and responsive to external signals.

For us, the strategy and preparedness worked out quite well. For the last few years, we have worked on a digital-only product, digital distribution, and a 100% digital zero-touch underwriting process. Finally, after many proofs of concepts and experimentations throughout the pandemic years, we launched the first set of products in 2022. It marks a first for the industry, and with all probability, this is the direction the rest of the industry will take. The performance exceeded all our expectations, and 2023 and 2024 will be years of the exponential scale of this approach.

How are you keeping up with the ever-increasing demands for digital transformation?

Digital transformation has various facets—ones that emerge from customer experience needs and ones that arise from the need to do things faster and better internally. At Aegon, the mandate is to stay one step ahead of the customer and shape the customer’s expectations with our superior experience rather than reacting to customer expectations post-facto. Keeping that in mind, we invested in digital underwriting even before it became an expectation so that we could underwrite and issue a policy on the spot without human intervention. Also, with digital distribution, we can save on the cost of distribution-operations and pass on the saving benefit to the customer. The silver lining from Covid was that customer expectations also got shaped along these lines and were a perfect match.

Our belief and experience have been that digital transformation is more than just going online. It is a different way to imagine your business. There is an aspect of art as well as science to it. Once you get the hang of it as a company, digital transformation opens opportunities you hadn’t thought of before.

Keeping that in mind, we invested in digital underwriting even before it became an expectation so that we could underwrite and issue a policy on the spot without human intervention. Also, with digital distribution, we can save on the cost of distribution-operations and pass on the saving benefit to the customer.

How are you integrating customer experience into IT deliverables? How is it helping in advanced customer experience?

IT Architecture that doesn’t help in enhancing customer experience and, hence, revenue is just an academic exercise. For us, a multi-level OKR system ensures that IT is an enabler of business and that deliverables are aligned with business and CX goals.

We start everything with the revenue objectives of the year, as determined by OKRs, and what each function must achieve for sales to reach there. IT comes at the third level after this—each function requests the support they need from IT to achieve its functional goals. So, for example, the CX team might ask to enhance our APIs to respond faster, while the pre-sales team might request a new dashboard to exchange information with a distribution partner. Since the IT deliverables are not being designed independently but are being requested by specific functions, they are, by design, aligned with revenue and CX goals.

Main choices come in where there is a pressing business need, and we have to create something “quick and dirty” (which likely incurs a tech debt) vs doing things first-time right despite business pressure. There are no right or wrong answers in these cases, and we strike a balance based on the case at hand.

Main choices come in where there is a pressing business need, and we have to create something “quick and dirty” (which likely incurs a tech debt) vs doing things first-time right despite business pressure. There are no right or wrong answers in these cases, and we strike a balance based on the case at hand.

How are you managing growing cybersecurity and data privacy threats?

Data has become the lifeblood of organisations, and traditional siloed approaches towards data protection won’t work. Since data privacy is crucial for creating digital trust and improving customer experience, we have taken many initiatives. We have taken a unified approach to Data Management and Governance, Data Privacy and Data Protection to avoid retrofitting cybersecurity or privacy implementations with holistic capabilities. We also deployed state-of-the-art security solutions for the proactive detection and remediation of cyber threats by integrating security in DevOps rituals using ShiftLeft, by bringing Security Left. Since the security controls are non-negotiable and inseparable for us, it is the default feature for us. It’s like you do not want your airbag in a car to deploy after the crash; you want it to deploy during the accident itself.

How are CTOs and CIOs seeing advancing organisational use of data as key to reaching enterprise objectives?

We are moving towards a data and insights-driven world. Data-driven algorithmic underwriting, data-driven marketing strategy and customer targeting, and extreme experimentation in CX design are just a few examples.

But the bigger rock that organisations must move is that of culture. It takes a lot of deliberate effort and patience to create a data-driven culture in the organisation so that organisational use of data is the default practice and doesn’t need an executive push.

I would like to believe that we are ahead of most companies in the industry, the journey was not easy. The mindset shift involved several workshops conducted over two years, getting new talent from outside the sector, gamification, incentivization, and a host of other deliberate measures.

At Aegon Life, we have adopted a digital-only strategy. We have moved the needle noticeably in cultural aspects, but hybrid organisations, for whom digital is just one part of the business, need to put in more deliberate efforts. I have seen that the executives’ stance determines the company’s culture, and the CIO/CTO must be the catalyst here. So, for example, when there is a decision on a particular topic, let’s say something related to CX; as an executive, would you base the decision on most people’s opinions after a long debate? Or would you say, “guys, let the data answer the question”? This behaviour will set the tone for the rest of the organisation.

How are you maturing the enterprise cloud strategy?

Aegon Life has taken a specific approach to mature its enterprise cloud strategy, including:

•             Developed a clear and detailed blueprint (instead of doing lift and shift of the existing ecosystem) to build a cloud-native – event-driven, microservices-based insurance platform that outlines the exact steps and timelines for moving applications and data to the cloud.

•             Establishing governance and security protocols to ensure compliance with industry regulations and protect sensitive data.

•             Building a team of internal experts – Engineering, DevOps, and Security, familiar with the specific cloud platforms being used and who can provide ongoing support and maintenance.

•             Continuously monitoring and optimising cloud usage to ensure cost efficiency and performance.

•             Building a robust disaster recovery and business continuity plan to ensure that systems and data can be quickly restored during an outage or other disruption.

•             Leveraging automation, monitoring, and management tools to ensure that the cloud environment runs smoothly and that any issues are quickly identified

and resolved.

•             Building a culture of innovation and experimentation (fail-fast) within the organisation to encourage the development and adoption of new technologies and best practices.

•             Continuously assessing and evaluating the organisation’s cloud strategy to ensure it remains aligned with business objectives and stays updated with industry trends and advancements.

How is the digital adoption and employee training in your company?

Since we adopted a digital-only sales strategy and a work-from-anywhere policy, the digital shift was an automatic byproduct. While I would like to believe that we are ahead of most companies in the industry, the journey was not easy. The mindset shift involved several workshops conducted over two years, getting new talent from outside the sector, gamification, incentivization, and a host of other deliberate measures.

New digital is the default mindset. We keep reinforcing and enhancing this through case studies, training, etc., which opens them up to the “art of the possible.”

What will be the trends in 2023?

2023 is going to be an exciting year. Three significant forces are playing a role here. First, India is clearly becoming stronger on the other side of the pandemic. As a result, there is associated optimism, which will reflect in all industries’ growth.

Second, increased digital awareness and adoption will bring a shift in channels.

Third, the actions of the insurance regulator aimed at increasing the penetration will make insurance products more accessible and democratic for the end customer while commoditising them, as far as companies are concerned. Democratisation will also pose cybersecurity challenges. Therefore, in this light, from an IT perspective, we will see:

1.            A lot more investment and focus on the digital customer experience, including a more intuitive purchase journey, the use of vernacular on

websites, etc.

2.            Increased investment in the cross-firewall exchange of information, which includes manufacturer and distributor on either side of the equation.

3.            Cybersecurity and fraud prevention-related investment.

4.            A continuing trend to reduce the “cost of compliance” and “cost of audit” through algorithms that do the job. In many cases, algorithms would eliminate the need for audits or reconciliations.