In getting ready for digitalisation, the most effective strategy is to digitise the current value
chain. As technology continues to advance at an astounding rate, and globalisation is about to be
redefined in a way more than just traditional economic metrics, reinsurance also plays a vital role
in helping insurance companies maintain their financial stability, especially in this digitalisation
era where the impact of digitisation is apparent. This article discusses the short and long-term
implications of digitalisation on the Asean insurance market.
In the short run, marketing and distribution are the sections of the insurance value chain that are
anticipated to be most affected by digitalisation. The impact in marketing can be seen in big data,
where more additional data sources are needed for improved customer segmentation. It is also
apparent on websites and social networking where insurance information and advertising
products take place.
The second impact of digitalisation is insurance distribution, which can be noticed in product and
after-sales. For instance, a chatbox can automatically sell products, giving the customer the same
experience speaking with a real person when it is actually an AI (Artificial Intelligence) taking
over the work. The short-term premium growth from digitisation is relatively modest, with a
maximum annual growth rate of 5%.
In the long run, underwriting and claims management can be listed as two of the most impacted
sections in the insurance industry. In underwriting, the impact on the value chain can be
observed in blockchain, where every data element is kept for computerised underwritings. In
addition, it can also be seen on the Internet of things, where telematics devices are used to gather
customer information for risk and price calculation.
In claims management, AI's long-term implications are noticeable, adding value in preventing
fraud through data analytics and the computation of damage amounts and payment efficiency.
The long-term growth that digitalisation is believed to bring is to boost premium growth, in
which a double-digit growth is expected.
The insurance industry is undergoing a revolution due to advancements in technology and
analytics. Head over to https://www.malaysian-re.com.my/ to know more about the latest
insights on the insurance industry.