An overview of how digital is transforming the Insurance Industry. With a case study from Nest, the UK Government's pension auto enrolment scheme on how they are embracing digital and innovation to attain strategic objectives.

1. Digital Insurance Enterprise
NEST Case Study – A Digital Start-up
Start-
Vinod Kachroo
Helen Dean
CTO & Global Head – Industry Solutions Managing Directore
Insurance & Healthcare
NEST Corporation
Copyright © 2011 Tata Consultancy Services Limited
1

2. Evolution of Business Objectives
Social Influencers
Physical to Digital
Footprint
Realize Rapidly
Extend Portfolio
Reach Everyone
Sense Demand
Business Objectives as the Enterprise Evolves
Yesterday
Today & Tomorrow
Traditional Enterprise
Digital Enterprise
2

3. Insurers Must Evolve into Digital Insurers
Social
media
Four generations
co-existing
Multi-channel
experiences
Global
reach
Evolving
technology
Customer
centricity
Next gen genomics, autonomous
vehicles, internet of things &
intelligent cities
Market drivers forcing evolution
Yesterday
Today & Tomorrow
Traditional Insurer
Digital Insurer
3

4. Shift to “Systems of Engagement”
Top executives
Decision Support
Systems of Engagement
External
Stakeholders
Consumer technology
Mobile face
SOR Integration
Middle of the
Organization
Context
Public Cloud
Systems of
Record
Transactional workers
4

5. Digital Forces Are Transforming The Business
Mobility & Pervasive
Computing
Channels
Cloud
AI &
Robotics
Business Processes
Five
Digital
Forces
Big Data
Analytics
Business Models
Products & Services
Customer Segments
Social
Media
Workplaces
5

6. Creating Innovation Assets… Making the Digital Journey Real
iAgent
Virtual
Assistant
Insurance
Quickpass
Telematics
CubuZZ
Social
CRM
Quotation
&
Illustratio
n
Fraud
Analytics
& Data
Mining
GIS
Integration
Executive
Dashboard
Knowledge
Mgmt &
Collaboration
Platform
Real Time
Integrated
Platform for
Services &
Analytics
6

7. The Digital Enterprise Creates New Outcomes
Characteristics of the Digital Enterprise
New Business
Models
Omni-Channel
Experience
Customer
Centric
Innovative Products
& Services
Insight Driven
Next Gen
Efficiency
Simplified
Processes
Improved
Effectiveness
Digitization of
Workplaces
Growth
Improved
Compliance
New Business Outcomes
7

8. NEST: A major corporate start up
Embracing innovation and digital
Helen Dean
MD Product and Operations
© NEST Corporation 2012

9. NEST is…
Part of a UK Government programme of auto enrolment, aimed at getting the
population saving for retirement
A trust-based statutory occupational pension scheme overseen by a Trustee
Corporation which is also a non-departmental public body
A high quality scheme designed for the ‘mass market’ including those unserved by
traditional providers
Obliged to accept any employer at a single price
Not-for-profit
Priced 1.8% on contributions, 0.3%amc
Self-funding in the longer-term, loan from Government in the shorter-term
Unprecedented take on challenge
A digital enterprise out of necessity and sustainability
© NEST Corporation 2012
9

10. Product Innovation - Online by default
Decided to make a virtue of the
absence of legacy business
Redrew the line between the
provider and customer
– Key administrative tasks sit with
the customer
Customers (either employers or
members) are guided towards the
online option. For employers it is
the only option.
SCALE
Millions of members
– never been done on
this scale before
Traditional paper
based model will
struggle with scale
© NEST Corporation 2012
COST
Successful
e-businesses leverage
high quality self
service capabilities to
enable scale and drive
down cost
Achieving low cost will require
straight through processing
Simple charging structure
means we can’t charge for
extra’s
QUALITY of
experience
Must be easy to use
Available outside of
core hours
High quality web
experience mitigates
channel risk
10

11. Product Innovation: the evolution of delegated
access
Third party
access to the
product to allow
ad hoc
translation
© NEST Corporation 2012
Different levels
of product
access for
different
customer
business units
Full third party
product
administration
access for
advisers and
intermediaries
11

12. Customer engagement driving innovation
Aim to be an intelligent user of quantitative and qualitative
research
Early design:
–
–
–
–
understanding market for auto-enrolment – the “unpensioned” & their specific needs
bringing the product to the market –brand, communication and engagement strategy
Research-based communications approach makes pension saving easily understood
Qualitative research into attitudes to pensions, investment risk and loss. Investment
strategy is tied directly to research findings
– Extensive product usability testing
Now focused on:
– tracking member’s and employers experiences of the scheme and NEST
– tracking behaviour of NEST members over time – making fund choices, engagement
with NEST communications, ceasing contributions etc
– evaluating impact of engagement strategies on member behaviour
All including continuing use of insights from behavioural economics
© NEST Corporation 2012
12

13. Affordability message
targets procrastination
bias
© NEST Corporation 2012
13

14. Wording targets loss
aversion
© NEST Corporation 2012
14

15. Future innovation - NEST’s data should tell the
story of automatic enrolment
Collecting a mass of data through MI – basic analysis underway –
more advanced work to come
– Main question for us is how to use it in the interests of the membership and
in the context of widespread academic interest
Very difficult to encourage engagement with the product – and
hence capture more sophisticated information
– Only 4 per cent register online
– Key question for NEST is how to exploit that in the context of a product
predicated on inert consumers
© NEST Corporation 2012
15

16. Start with “USER”: Unify, Simplify, Engage & Respond
Unify: Ability to provide a consistent customer
experience across brands, products, and channels
• Omni channel customer experience
• Matching & mapping of enterprise customer & social persona into
SocialCRM
Simplify: Ability to achieve operational
excellence in both business and IT
• Process simplification
• Application portfolio simplification
E R
Engage: Ability to create and
sustain customer engagement
•
•
•
•
•
•
Improved stickiness
Advocacy
Collaboration
Rewards
Value added productivity tools
Gamification
Respond: Ability to sense and
react to customers timely
• Anytime anywhere
• Real-time systems integration
• Insight driven next best action
recommendations
Engage
S
U
Respond
Simplify
Unify
16

17. Think Holistic, Plan Incremental
Holistic Digital Strategy
Integrated insurance
digital experience
platform vision
Business
prioritization
Single executive
sponsor / owner
Small projects with continuous business value delivery
•
•
•
•
Web / portal redesign & consolidation
Web content migration & management
Insurance forms modernization
Multi-channel analytics & Voice of customer
•
•
•
•
Social data leverage & big data analytics
Backend service & data integration
Incremental legacy modernization
Infrastructure & availability optimization
17

18. Common myths about being a digital insurer:
Myth
Direct to
consumers
only
Customer
segment of
one
“It’s all
about big
data”
Myth Buster
•
Omni-channel
•
Flexibility for customer to use preferred channel
•
Ability to switch between channels without losing
context
•
It will never be for “1”
•
Better customer insight for finer segmentation
•
Contextualized offers & next best action
recommendation
•
Use both structured & un-structured data
•
Use externally available data wherever it makes
sense
•
Use data from social to complement internal CRM
data
18

19. Thank You
19