How HDFC ERGO is Rewriting the Rules of Success in the Insurance Business

NOTE: This is a raw transcript and contains grammatical errors. The curated transcript will be uploaded soon.

Sourabh: Hi, everyone, and welcome to Convex 2024 by VW. My name is Saurabh Arya, and I head the Martech and AI division at Performance India, a part of Publicis Group. And today I feel honored to invite Mr. Soumesh Suranna, who heads the Digital Business Group and Marketing at SDFC Ergo, which is India’s leading general insurance company, to share his insights on experimentation journey at SDFC Ergo.

Saurabh. So a very warm welcome Somesh, uh, on the platform today. Uh, let’s start with a brief introduction and our audience would love to know a bit about, uh, your background and your professional journey. Okay.

And

Somesh: Thank you. Thank you, Zorab, for having me, uh, for this wonderful session. Uh, briefly, let me just talk about myself. Uh, you’ve already said, I, manage the digital business And marketing for HDFC Urugu.

Uh, how I started was, uh, I’ve been a marketeer all my life. Uh, start my career with an advertising agency, Uh, move to marketing side, largely work with, uh, within the BFSI sector. And then slowly in 2011, 12, when the, when the real digital uh world was explored at that point in time. I started, uh, managing digital business, setting up the digital businesses, uh, fortune insurance companies.

Uh, and that’s where my journey along with marketing of setting up and scaling up digital business is, uh, what started almost 12 years back. Uh, thankfully. So, uh, today, uh, we, uh, are one of the leading. Uh, digital insurers, right?

Uh, not only from a digital business standpoint, but also from a perspective of, uh, how can we kind of digitize, uh, or meet expectations of the evolving expectations of consumers, uh, in fulfilling their needs, not only from an onboarding perspective, but also from a servicing, from claim servicing, from wholesale servicing, all of those kinds of aspects. as well. So, uh, that’s where I am. That’s what my journey has been.

Sourabh: Superb. So, uh, So, much. I, I, even I have been a part of, you know, SDFC Ergo family because I have a car insurance and a health insurance from SDFC Ergo. And, uh, you know, I have seen that, you know, SDFC Ergo has been making waves in with its digital initiatives.

So can you share what sparked this focus on the digital optimization in the insurance sector? Okay, let’s

Somesh: we’ve been very focused in terms of, from the time we started, one of the key things that we as an organization or the philosophy that we’ve been following is, uh, what our customer really needs. So if you see anything and everything that we do, may it be from, uh, designing the onboarding processes, may it be from designing the product And propositions that we need to offer to the consumer may it be. The servicing in the claim side, anything that we do at an organizational level, philosophy has been to understand what consumer needs, what really, really is the problem statement and challenges that our consumers are facing and try and solve that.

Uh, as I said earlier as well, uh, the consumer’s needs have been evolving, uh, and at a much faster pace than what it used to. And today, consumers expectation is they don’t compare us with an insurance company experience. They compare us with any other category that they’ve been exposed to. So if a consumer is able to buy a television on an e commerce portal within a couple of clicks and couple of minutes, their expectation is why should I not be able to buy an insurance policy as well?

Why, why I should not be able to, uh, have the same experience when I have a claim with an insurance? Uh, so I think, uh, one key thing that we’ve been following is what our consumer needs are. How can we resolve for those? And that can only be possible, especially for an insurer like us.

We are an insurer, uh, insurance company which operate at a scale. Uh,

Sourabh: to

Somesh: it is very important for us to have That, uh, in within the DNA, in terms of how do we kind of make all our processes, how do we kind of look at all our service capabilities and make them more and more digital? Uh, that’s where the thought process started. That’s where we started challenging the status quo. That’s where we started thinking how we can resolve for it.

Uh, so anything and everything that you talk about may I can go on and on and talk about it, uh, may it be policy onboarding, uh, most of our customers are today onboarded digitally, irrespective of whether they are from digital channel or any other channel that we are sourcing, uh, when we come to servicing, um, Most of our consumers, today are serviced digitally. Today, if I talk about pre inspection, earlier there used to be a time when a surveyor used to go, if there is a break in in a policy, if I give an example of motor insurance, surveyor used to go and inspect the vehicle. Today, through AI, through the digital solutions and platforms that we’ve created, consumer has everything in their hand.

They can do it from their, uh, uh, from wherever the vehicle is. And all of that has been reduced to probably 5 minutes or 10 minutes and the vehicle pre inspection reports gets approved within 5 minutes. So I think, uh, things are moving. We’re trying to, uh, move along with the consumer.

We want to be, and we are on the right track to be one of the, uh, digital insurers who operate at scale. And for, for us, consumer will always remain.

Sourabh: Super. And so, so so much, tell me something about, uh, this thing that at your position, of course, you are not heavily involved in running the campaigns or a day to day campaign activity. Uh, but our audience would be curious to know that what thoughts. Run in the mind of a head of digital customer.

Somesh: So I think, uh, you’re right, uh, Saurabh, I obviously, uh, don’t get into day to day, uh, campaign strategies, uh, but yes, um, to run a digital business, there are largely, uh, and I always say this, there are largely three or four levers that you need to look at. One is you need to get, uh, the consumer, be in the mindset of the consumer at the right time, at the right place, how do I go and target the right set of costs, consumers. How do I identify people who are looking to buy an insurance or might be buying an insurance? How do I target them and what are the channels that needs to be looked at so that we can target the right set of consumers?

That’s, that’s part one. Once you have targeted the right set of consumers and got them, uh, uh, obviously you need to have, uh, the right proposition for the, that consumer. Otherwise, if I’ll get a consumer Whatever the consumer is looking for, if I don’t offer that proposition to them, they will obviously not be buying a product or a service or a policy from me. So it’s important to look at and customize or personalize these propositions based on what the consumer needs.

Once that is done, you also need to have a very robust platform available. If I’m getting the consumer it, even if I have the proposition, but if the buying process or the platform is not good enough for them to buy. Uh, obviously I will again lose that customer. So as a digital, uh, uh, leader, I need to have, uh, all of these three things in place.

Once the platform is available, we’ve got the consumer, uh, been able to kind of customize the offering or the proposition for that consumer. We’ve got the platform from which seamlessly this consumer can buy. It is also important in the business that we are, that we need to be able to service this customer at the time of the need. So, Although ours is a category where we always say you buy a product and you always feel that I should not be able to use this product because nobody wants to use insurance for sure.

They don’t want to get in a situation where they’re using it. But whosoever is being exposed to or coming to claim with us, we also then look at how do we kind of make the consumer experience Seamless frictionless for those consumers as well. So, uh, for, for me as a business, uh, leader who leads the digital practice, uh, for HDFC Ergo, I need to look at all these things. I don’t stop it at just getting the consumer and onboarding the entire life cycle of the consumer.

And once that has happened, uh, once that has happened, you obviously then need to look at retaining these consumers in the years to come, because insurance is a contract, especially if I talk about products like health insurance. It is a regular contract that needs to be renewed year on year. And if I don’t engage with this customer on a regular basis, then I’ll not be able to renew a policy or retain this customer for a longer. So we also need to have proper engagement strategies.

And that’s where, uh, I will talk about that, uh, in more detail as well, but our mobile app, which is our first insurance led ecosystem is nothing but a tool where we can engage with the consumer. I mean, insurance is, uh, largely been a very transactional business. Consumers come, they transact, and then if there is a claim, they used to come back to it. That we are experts in.

But we always felt that how do we become a part of consumers life in terms of whenever they need any information, which we as an insurance provider can provide. Here is that engagement, uh, tool or an application which helps us in engaging with this customer. So I think that’s the complete cycle that I look at. Uh, I see how I can get all of these blocks together and how we can give world class experience to the consumers who come on board with us.

Sourabh: Great. Amazing. So, uh, since I worked very closely with your team, Somesh, on several, uh, you know, experimentation projects, I wanted to take a minute, uh, to discuss an interesting experiment on the car insurance page that increased the conversion rate by 45 percent for SDFC Ergo. So Somesh, how important is this page from a business perspective for SDFC Ergo?

Somesh: No, I think it’s very important, Saurabh, I mean, you work closely with us, uh, and thanks to you and the entire team, obviously, uh, for helping us, uh, do this. Uh, motor insurance, uh, remains a very important business for us. Uh, and especially car insurance for us from a direct consumer perspective. Uh, it is in India, uh, mandatory to have a car insurance if you’re driving a car.

And hence from a consumer perspective, this becomes a very important product or a policy or a contract that they need to, uh, obviously this page hence becomes very important for us. So. Uh, it’s always important to experiment. It’s always important to find out what is working good, what is not working well.

Uh, the A B testing, which helps us in understanding this segment prefers something else, that segment prefers something else. And hence, it’s uh, gone are the days when we used to say one page, uh, will be sufficient and good enough for all the consumer segments. So I think, uh, what you’ve been able to do, what this tool has been able to do is clearly given us, uh, and, uh, and, um, and way to kind of experiment and find out what are the things that really works with that consumer segment, uh, which also has given us the kind of results that you just spoke about, which is. Uh, uh, which is 45 percent, uh, increase, uh, is what we’ve seen on the motor insurance page.

So I think, uh, uh, and on a overall basis, we, we, believe in a, in a philosophy of, and we work with partners like you. Google and other very big partners where we ensure that most of the experiments we are part of as a brand. We want to be the first ones to experiment and see what works better. And once if that is a successful experiment, then we scale it up for all our other products as well.

Sourabh: Uh, so, so much, how did you feel about this uplift and how did you communicate this result at your level?

Somesh: So I think uh, any uplift for, for a business team is always good and uplift a 45 percent conversion rate, obviously something that we, uh, look up to. Um, the idea, like I said, sort of is, uh, we tried this for a specific segment right now. Um, we could, uh, find fine tune in terms of what is working, what is not working. Now we will extend this to other segments first within the car insurance cohorts itself.

And then the idea is to take it to the other LOBs as well. So, uh, that’s how we go, uh, about anything. Uh, I think, uh, what is more important to look at and how we look at it is we will continue to look at tools which will help us hyper personalize. Uh, things, propositions, communication for our consumers, and I think this tool really helps us doing so.

I can find out what a particular segment is looking at through A B testing and various features of this tool, and I can come to a consensus that this is the kind of communication, these are the kind of questions. Uh, that probably this segment would prefer versus another segment and then I replicate the same learnings across the table,

Sourabh: I second to that thought, because even, uh, since, since I started experimenting with, uh, for, for a lot of brands, uh, I have seen that VW has been extremely, uh, uh, you know, a better tool, uh, which has helped in personalizing the experience. experiments for the specific set of users. I can create different kinds of cohorts and then I can target them with the relevant experience that they are looking for on the platform. Right?

So in that way, I think that that was a great thing to have. And another experiment that I was involved in was on the health insurance page, uh, simplifying the form that increased the lead rates by 16%. Now, this might be a tricky question, but, uh, between car and health insurance, What product is more closely looked at by the leadership at the company?

Somesh: Now, I think, uh, we don’t look at, uh, it in this manner that car is not important or health is not important for us, all the LOPs are important, yes, uh, uh, we look at segments which will make more sense for us or which are more, uh, so as to say, uh, profitable for us. Which will give us a long term, uh, consumer, uh, life management, uh, opportunity. And that is how we look at, uh, like I said earlier as well, health insurance is something where once a consumer is with you, probably at least for 10 to next, next 10 to 15 years, that consumer will stay with you. You’ll be able to retain that in most of the times.

and hence from that perspective, if I were to look at, if I were to be, uh, wearing my business hat and say. Yes, health insurance obviously remains of utmost importance for us from, uh, the percentage of business that we do on health is much more on the direct side as well, uh, digital direct side as well, uh, than what we do for any other line of business. So yes, uh, health is of, is, is a preferred line of business for us.

Sourabh: So SDFC Ergo recently noted as the India’s first brand to optimize convergence using the CRO principles and leveraging Google Ads. how has this approach set you apart from, the competition in the market, insurance market specifically? Um,

Somesh: in anything and everything that we do. And, uh, experimentation is a very important thing for, uh, being a leader.

Sourabh: No.

Somesh: This is, uh, like you rightly said, uh, we were the first brand to try this, uh, and the CRO principles have helped us in understanding what works with a particular consumer segment, what works with another particular, uh, consumer segment. So this really has, uh, potential and given us some sort of value in terms of how we can now take this ahead. Uh, in terms of, uh, what should be done, how we will go about it, I think any experiment is done to see whether it is working or not, and then we scale it up from a scalability perspective. It helps us in figuring out with a smaller cohort, whether this would work or not.

So the idea is to now scale it, scale it up and take it ahead with all the line of businesses, all the cohorts, all the segments that we, uh, operate in. Sounds good. Like when you were saying that, uh, we were the first brand to do this, uh, not only for this, but for many other experiments, beta that we do with, uh, all the, uh, large, uh, partners that we work with, uh, we’ve been amongst the first ones to kind of experiment and try things.

Sourabh: That’s, that’s really amazing to hear that. so much. And many of our successful tests also involved the clearer CTAs and visible forms that that we saw. Now, how do you strike a balance between providing enough information and encouraging a quick action on the platform?

Okay.

Somesh: or more number of people will be able to kind of click on, uh, the CTA. Uh, the other school of thought is if you’re asking them a relevant question, they’re going to say, at the right time. Uh, you will see that consumers will not really drop off and they’re fine to kind of do it or there can be incentives that you can provide for giving the additional information. Now, uh, this also probably changes as we move from one product category to another product category, but largely the thumb rule is bare minimum information that is required needs to be Over and above that, if there is something which is relevant, which a consumer feels is relevant and which will help them in giving a personalized, Uh, experience, I don’t think a consumer has any issue in giving that information as well.

So, uh, you need to do, uh, uh, uh, testing amongst various consumer segments. You need to then see. It could be, for example, I can give you an example in a category like travel insurance. I might not want to ask any additional information, but in a category like health insurance, if I ask one or two additional questions regarding the health of the consumer, I will be able to give them a more accurate quotation in the first instance itself.

So depending on the product category, depending on what category I’m, uh, uh, I’m looking at, uh, my strategy will change accordingly.

Sourabh: Yeah. And so, so I think rightly said, uh, so much, so when you take this concept, uh, at a, at a holistic level, at a, at the entire organization level, so as a head of digital business group and marketing, how do you foster the culture of experimentation and data driven decision making across the different teams?

Somesh: I think, uh, uh, that’s, uh, to be honest, uh, that’s a hygiene for us now. It, it is no more a buzzword, uh, so as to say innovation, data driven approach. Anything and everything that we do at HDFC ErgoSort of, I can assure you, and not only digital team, but all the other teams as well, uh, we’re absolutely, like I said, two things that we are, we are very, uh, probably I can say we, we are very passionate about. Is consumers and data.

I mean, the amount of data that is available and if it is used in the right manner for helping the consumer or solving for a challenge that consumer has, you really can solve for it. I mean, I was talking about the approach that we’ve taken as an organization. The philosophy that we’ve taken as an organization is we already have in market share. How do I move from a market share to mind share, right?

If I have mind share of the consumer today, If we are able to kind of be in their lives, I was talking about here app that we’ve launched, it’s just been one year, uh, that we’ve launched this app. We are more than 6 million consumers who are using this app. The whole philosophy has been around how can we be in consumer’s life at different life stages. so just to give you an example, uh, who better than us can tell you That what will be your expense for a particular surgery in a hospital in Bombay, right?

we’ve paid claims, we’ve been paying claims for now, uh, more than 20 years, we have that data available. Our app, with the help of AI, will be able to tell you on, in clicks, in couple of clicks, if you were to go and say, uh, do a bypass surgery in an XYZ hospital in a city like Agra, what will be the expense? Versus in a city like Bombay, what will So these are the questions that consumer has and they are always, they have these questions whether my cover is good enough or not. If something happens, will I be able to kind of pay for this or not?

Now this simple thing is an engagement. Or a convenience feature, which is available with the consumer. We have, uh, we are the only platform probably, which provides a patient to patient connect, right? If somebody, uh, wants to know that they’re going through a procedure, say a knee surgery they want, what will they do?

They go to a doctor, they will check what happens, how happened, how, what will be the, uh, procedure, uh, and how the things will be post procedure. They also always want to connect with somebody who’s undergone this. All we’ve done is we’ve, uh, we reached out to all the people who took claim from us and we said, would you want to be in volunteer and speak with somebody? So somebody can today come on our here app.

And just speak with a person who already has undergone a knee surgery and just understand the experience, how it has been, what it has. You get confidence, you get to know more. So these are just few examples. I can talk about motor ecosystem.

I can talk about health ecosystem. We have a pet ecosystem for the first time in the country. So I think, um, the idea is to kind of Make all of this in hygiene that How can we be in the mind share? How can we gain mind share of the consumer and market share will automatically follow if I am in your mind share then whenever there Is an insurance needs to be honest Selling is the last thing that we do on this application.

You should download this application and see it You’ll never get a nudge that you should buy a policy But you will get nudge that how do we kind of engage with you in the kind of things which can make your life Simpler and more convenient. So that’s the approach Innovation Is in everything, in anything that we do data, we look at data very closely, maybe onboarding may be, uh, servicing may be claimed servicing, anything that we do, we look at data very.

Sourabh: Great. So, so when you say data, uh, so much, I think, uh, the, the, uh, current buzzword, uh, across the globe is, uh, privacy, right? and personalization often requires substantial amount of, data. How do you navigate, uh, the data privacy concerns while still delivering the hyper personalized and the personalized experience in the insurance sector?

Okay. Great. So,

Somesh: when it comes to data privacy as a, uh, as a, uh, responsible brand. And we come from a, uh, uh, from a group which is HDFC group and the go, uh, uh, uh, group. So we need to be very, uh, careful when it comes to any kind of requirements, regulatory requirements, compliance of data privacy, the risk management practices that we have in place, the kind of, uh, rigor that we have around data privacy. is something which is absolutely, uh, of utmost importance for us.

And, uh, that I think when you speak with our consumers, and I have been a part of some of these discussions that comes out absolutely, uh, uh, time and again, that consumers absolutely trust us when it comes to privacy, when it comes to any kind of, uh, promises that we’ve done as a brand. I think we, we will continue to work on that. panel that’s gonna And hence for us data privacy, all of these kinds of practices that we follow is of utmost importance. Take care of all the compliances, all the regulatory requirements are always at your

Sourabh: Great. Great. So when when you did all these tests, so looking at the results, there’s a clear focus on the lead generation. How do you extend the personalization beyond acquisition to improve the customer retention and you know, the cross selling that can happen?

Uh,

Somesh: So I think, uh, like I was talking about for, for us, if you’re able to engage with the consumer at the right time, uh, once the acquisition is done, uh, probably the only time when I, when we used to interact with the consumer used to be only in case of any incident, which could be claimed or any servicing needs that they had after buying the policy. So it was very important for us to then think of a strategy where we can engage with them on a regular basis. So, uh, any campaigns that we do, any communication that we do, nudges and notifications that we are able to kind of do, these all help us in engaging with our consumers.

The, the key that we follow and the philosophy that we follow is it needs to be more relevant and contextual. If I’m going after the consumer again and again, and I’m saying, okay, you buy this product as well, that product as well. And I know, I don’t even know whether this consumer needs that product or not. that doesn’t really work.

So we are very clear in terms of we will not use our consumer data for marketing any and every product. Only if we are aware of the need of the consumer, then in that case we will go and propose and do not adjust. That’s very important. Retention again remains an important aspect for an industry like ours, especially in a product like health insurance, where your retention rates are close to 85 to 90 percent.

So, You really need to kind of engage with the consumer and ensure that your attention rates are in the range of 85 to 90 percent should be retained with you. And for that we have multiple, uh, communication strategies, reminder strategies, uh, how do we kind of reach out to the consumer? There is a set of consumers probably who prefer one mode of communication versus there is a set of consumers who prefer another mode of communication. How do you kind of gather all of this information, store this information and then reach out to the consumer?

through the right mode of communication. That remains an important strategy for us. Another important thing that we look at is how do we kind of personalize the experience that we have. So today through our mobile app, which is here through our, website experience that we’ve been able to create, we’re able to personalize the experience of the consumer.

If the consumer is coming for a particular thing, he will only look at information which is pertaining to that. So if you’re If you already have a motor insurance with us, and if you’re here only for health insurance, then why should I bother you with, uh, information overload, which is not important for you because you already have a motor insurance. And hence I should only be looking, giving you data or showing you data, which is more relevant. So personalization again, plays a very important role.

I think all of this put together finally helps us in thinking beyond lead generation and acquisition as well. Uh, how do we kind of engage with the consumer at the right time? And what are the modes? And Uh, means to communicate.

Sourabh: So in this era of 2024, when you know, the, uh, the another buzzword is AI, uh, and genuinely AI has been making a notable impact across the different industries and functions. How do you see it evolving at SDFC ago? Yeah. Yeah.

Somesh: So I think, uh, yes, it’s a reality now or earlier if anybody used to say, uh, I also agree with you. It used to be a buzzword. AI and generative AI is no more a buzzword, but, uh, it’s in reality now. If you not, uh, identify use cases where you can really use these, uh, probably you will not be able to, uh, be a leader in the digital space.

space. I think we have wonderful use cases and we’ve been able to find solutions through AI there. I already spoke about here app, uh, where we use AI for multiple things, for personalization of the experience, for engaging with the consumers at the right place.

Sourabh: we’re Um, Yeah.

Somesh: for providing the information that a consumer is looking for. So there are multiple tools of AI, generative AI, everything.

Sourabh: I think everyone

Somesh: Uh, we have, uh, another platform called HEIQ platform, which we specifically designed for SMEs. And, uh, that is another use case where we’ve been extensively using AI. I also spoke about something where pre inspection, where there is a break in in your motor insurance. We’ve been using AI and we’ve been able to reduce the time, which initially used to be somewhere around five, six hours, and then we came to two hours.

And today a consumer can do a pre inspection within less than five minutes through AI.

Sourabh: of conversation

Somesh: claims that we’ve been doing where you can do the assessment of assessment of the claim through AI. Through the pictures that have been clicked, what is the kind of claim that, that is there. So the smaller sizes claims can really be quickly done. So I think, uh, we’ve been using it extensively across.

There’s an application that we’ve made for our channel partner. That’s one of its kind applications and super app called OneApp. It’s the, it’s an app where, where nudges, where the proposition that, uh, that an agent should be proposing to the consumer is AI driven. Anything and everything.

We’re Agent doesn’t need to really think about it. He needs to give certain inputs and our AI engine will propose what needs to be done. So I think, uh, there are multiple and I can go on and on and on talk about it. Interactions that we do, uh, customer service use cases that we have, renewal, retention use cases that we have.

So at an organizational level, uh, this has become like a reality now. It is no more a buzzword for us. Uh, we have been using this, we’ve been training our models much to a level where, uh, 95 AI. We had to train that model.

We had to again and again put images there. We had to kind of train that model and it’s been going on for a while. So we are at a stage that now this buzzword has become like a reality for

Sourabh: Wow. That’s amazing. And, you know, uh, so much, I’ve learned a lot from you today. So I must ask this question, this, this last question to you, what books are you currently reading?

Somesh: us. Also, uh, I, uh, don’t get much time to read books. You guys make me work a lot, uh, sort of. But, uh, uh, I think, uh, whenever I get time, um, I, I have been reading the psychology of money, reading that something that I, uh, I like, I mean, those are the kinds of things that I like.

I also follow, uh, and I am a, uh, wildlife enthusiast. So a lot of books I read is around wildlife, tigers, and all of that. So these are the two basic interests that I have. So anything and everything around businesses.

Successful businesses, successful leaders as the genre that I typically read books on or probably the wildlife that I, I like going to jungles and all.

Sourabh: Wow, that’s awesome, man. I would love to read the psychology of money because I have heard a lot of, uh, you know, good reviews about it. So that’s, that’s a really amazing book. Uh, so with this, we come to the end of our, uh, discussion.

So much. Thank you so much so much for your time and a great insightful session. I’m sure our audience would take away a lot of good insights from your journey of experimentation at HTFC Ergo.

Somesh: Thank you Saurabh. Thank you for having me. And, uh, it was, it is always a pleasure speaking with you. And I hope, uh, with the kind of things that I spoke about, the audience will also be able to take some good insights out of it and use it in their respective businesses.

Sourabh: Absolutely.

Somesh: Thank you so much.

Sourabh: Thank you