David Piesse – Head of Microinsurance Unirisx Apr 2011
Unirisx – Rural Finance Solutions
Presentation to MiRT Roundtable – What’s New
Page 2
Presentation Agenda
• India Project Has Commenced
• Weather Index Enablement
• Unblocking the Security Concerns – Op Risk
• Challenges
• Capacity is hard for insurers doing non life microinsurance because of loss ratios, moral hazards and distribution with innovative product design.
• Reinsurers need contract certainty, robust IT systems and strong claims control in order to provide the needed capacity. This slows down adoption in microinsurance sector.
• Strong primary insurance base is required in order to satisfy the umbrella need of reinsurance.
Capacity Hard - Non Life Microinsurance
Benefits of Pay As You Go – Must Haves
Internet-based business service – accessible 24x7
No investment in IT hardware, software or infrastructure
Multi-language; multi-currency; multi-compliance regime
Supports B2B and B2C
Create unique distribution network e.g., Mass Market/Affinity; Bancassurance; Portal, Small Ticket
Real-time risk management
Straight Through Processing (STP)
Documentation immediately available at POS
On-line underwriting / automatic rating
“Pay as you Grow” pricing modelConfidentialPage 4
QUOTA SHARETREATY PORTFOLIO
INSURER INSURERR INSURER INSURER
CLAIMS CLAIMS COLLECTION CONTROL
REAL TIME CLAIMS BORDEREAU
MONTHLY ACCOUNTS
MI REINSURANCE MODEL
EUROPE
INDIA
Sample Data Only
1 2 3 4
Loss ratio 5.257% 4.724% 15.010% 26.388%
Loss ratio after fees 6.531% 5.869% 18.645% 32.780%
0.000%
5.000%
10.000%
15.000%
20.000%
25.000%
30.000%
35.000%
Loss Ratio (2009)
Total Numbers of Claims by Category –Sample Data Only
SMALL BOWEL RESECTION0%
CARDIOLOGY AND CARDIO THORACIC
SURGERY9%
E.N.T10%
GASTRO ENTEROLOGY3%
GYANECOLOGY8%
Gynecology0%
HAEMATOLOGY0%
HYSTERECTOMY0%
NEPHROLOGY / UROLOGY12%
NEUROLOGY6%
ONCOLOGY17%
OPTHALMOLOGY6%
ORTHOPAEDIC SURGERY21%
OTHERS4%
PLASTIC AND FACIO
MAXILLIARY1%
THORACIC0%
VASCULAR SURGERY1%
#N/A0%
Blank1%
Rural Distribution Network
Mobi
le Me
dica
l Van
s
Policy and Claims B2C
B2CBilling and Payments
Embedded Technology Platform
Tea P
lanta
tions
Multi
ple C
hann
els
Data
Cen
ter M
anag
emen
t
Chan
nels
Traditional Client• E-Kiosks
Internet Outlets Laptops
Secure HostedLow Cost Service
Technology Enabler
Mobile Phone• Pre Prepaid• Smart Card• Top Up Service
Global Microinsurance Model
Hosting by Country/Region
Distribution
Best of Breed
Banks
and
Insurers
JSL Kendra
Mobile Medical Units
Kiosks
JNN members
Mobility
Page 10
Presentation Agenda
• India Project Has Commenced
• Weather Index Enablement
• Unblocking the Security Concerns – Op Risk
• Progress On Embedded Tangibles
• Challenges
As well as product distribution, business users can package up differing coverages, products, LOB’s to offer the end user a “menu” of items to choose from, or to aid in the Cross-sell product.
So for instance the ability to take out a Loan for Seeds, along with insurance for the Crop and Livestock.
Claims can be manually triggered for instance on a yield threshold, or automated based on inputs from a variety of events – such as wind speeds from external sources, rainfall index from weather stations
Electronic attachments can be added to the claim file – e.g. to show pictures of the catastrophe, or to record yield reports against the claim for validation.
A variety of data can be captured against a claim depending on line of business and statistical analysis required - e.g. capturing catastrophe codes to aggregate against a single event.
Once a claim is added to a policy, a full audit trail is kept so at all stages both policy and claim data is available at all times
Page 20
Presentation Agenda
• India Project Has Commenced
• Weather Index Enablement
• Unblocking the Security Concerns – Op Risk
• Challenges
Producer Profiling & Recruitment
Shared Document & Content Libraries
AppExchangeActivity & Contact Management
Submissions, Quote to Bind
Agency Plans & Commissions
Channel Performance & Analytics Call Center Chat & Email
Support
Customer Sites & Ideas
Web & Social
Portal & S2S
Protecting the Insurance Cloud
TELCO, China Post Office Case Study
Simultaneous rise of mobility and INTERNET gives rise to innovation in emergingMarkets where 3 billion people in rural areas remain without access to financialServices. In the insurance industry microinsurance funded by reinsurance capitalInto communities is becoming the model to assist alleviation of poverty, protect against natural disasters promoting new middle class. Technology pays a key rolehere in keeping the cost of transaction low and mobile phones in conjunctionwith the cloud is dominant. The challenge is to open secure gateways for emailand data so the insurance industry will participate fully and take on the risk. .
Media Publications for Verification
A provable signature service where the signatures can be mathematically verified using integrity codes published in Financial Times and other insurance media off note.
Page 27
Presentation Agenda
• India Project Has Commenced
• Weather Index Enablement
• Unblocking the Security Concerns – Op Risk
• Challenges
Challenges
• Data Collection has been slow on the working project
• Regulator has tried to stop outsourcing to protect policyholder.
• Only the MIS part of the MI solution has been adopted and not yet real time completely.
• Policy administration part needs to be adopted for complete contract certainty.
• Embedded intangibles still applies so RBC/DFA modelling should include MI as a new risk source for balance sheet. .