Neosurance's AI Driven Microinsurance Service
Another company driving innovation with AI is insurtech start-up Neosurance, which has created the first virtual insurance agent that sells micro policies to communities managed by third parties. This is done via push notifications to potential customers via a smartphone app that provides highly personalised microinsurance offers according to an individual's location, behaviour and needs.
The push notifications are sent in an intelligent way, leveraging Neosurance's AI and machine learning system, which bases its knowledge on contextual data. This allows it to offer the right cover, at the right moment, at a reduced cost and for just the period of time that the coverage is needed.
In December 2016, Neosurance announced they had signed a memorandum of understanding for the distribution of microinsurance to KLCC Runners Group community and their partners, a group 17,000 members and growing. This will allow group members to purchase customised microinsurance policies solely for when they need coverage.
Whilst the microinsurance product will be provided on-demand by a leading reinsurer and insurer yet to be disclosed, this represents a new AI-driven personalised approach to the sale of microinsurance, a trend that is certain to spread as Neosurance expands its partnerships across the region.
AXA's Usage-based Insurance for Private Hire Car Drivers
Continuing the theme of personalised insurance based on customer behaviour, AXA Insurance launched its "Pay-As-You-Grab" policy (PAYG) for Grab car drivers, the first-of-its-kind in Southeast Asia. The policy aims to save drivers money on their insurance premiums by calculating the cost on a 'per kilometre' basis instead of a single fixed fee. This is enabled by the geo-location tracking function used by driver's smartphones in conjunction with the Grab Car app. Using this data, PAYG lets drivers pay a flat rate of 70 percent of a base premium and the S$0.06 for every kilometre driven on Grab rides.
"Recognising the growth and demand for part-time drivers, we identified that one key barrier for drivers, especially part-time drivers, is the regular fixed insurance premium model," explained Doina Palici-Chehab, Chief Executive Officer of AXA Insurance. "With flexi driving hours, paying a fixed insurance premium does not make economic sense for them. This new pricing model will allow both drivers and passengers to enjoy savings and a better peace of mind when they are on the road."
According to Leo Costes, Managing Director, General Insurance, AXA Insurance, "Since its launch in May 2016, [PAYG] has collected telemetry data from more than 500,000 Grab trips, spanning 3.3 million kilometres, over 40 million GPS coordinates-data which has helped Grab drivers to save on average 15% of their premium as compared to traditional insurance." Based on the success of this launch and the proliferation of connected devices, AXA is channelling significant investment into developing more usage based products that are personalised to their customers.