Insurance industry going digital

The country's insurance sector is being digitalised in order to ensure transparency and accountability, as well as to prevent misappropriation of money and harassment of policyholders.

Some private insurance companies now provide services through digital platforms or software, and many others are investing in automation. 

To tap into this new wave, the Insurance Development and Regulatory Authority (IDRA) is planning to bring all private companies under one umbrella through automation or Insurtech technology.

The regulator says bringing insurance companies under one platform through automation will reduce customer harassment as premium receipts and claim settlements will be done digitally.

Addressing a press conference on Monday, IDRA Chairman Mohammad Jainul Bari acknowledged that due to the irregularities of some companies, clients are losing confidence in the sector.  

Regulators and insurers believe that if the insurance industry is digitalised, insurance companies will stop collecting policies through field agents, while customers can deposit premiums in software systems from home via online or mobile financial services. 

As a result, customer harassment, non-payment of premiums, misappropriation of money, non-payment of insurance claims, and various complications will come to an end.

"Agents do not know the code of conduct. Now companies have to do marketing on digital platforms since the younger generation is not accepting agents," the IDRA chief said.

The regulatory body has been working to accelerate the digitisation process. It made e-receipts mandatory in December 2021.

In 2019, the IDRA launched a unified messaging platform (UMP) to send premium payment information to policyholders' mobile phones. Now, every single transaction with insurance companies is instantly communicated with clients, thus ensuring transparency.

The platform has also enabled insurance clients to get e-receipts for the last three years through an app. E-KYC has also boosted confidence and saved a lot of courier service and printing costs.

As per directives issued in 2021, every insurance company is required to ensure a self-contained computerised system by coordinating integrated accounting software and policy management software with a central database.

Digital products are giving dividends as reflected in the data. The real growth of total insurance premiums increased to 12.04% in 2022, IDRA data show.

According to the authority, every insurer now offers some or all of its services digitally, developing customised software.
Since 2019, Guardian Life Insurance has been providing services to customers digitally through apps.

Nowrin Islam, assistant vice president (Marketing and Communications Department) at Guardian Life Insurance, said, "First and foremost, Guardian Life has launched the MyGuardian app, which allows customers to manage their insurance from their own homes."

Green Delta Insurance Company is the first general insurance company to initiate online payment-enabled digital insurance services in 2018. In 2020, it launched a comprehensive mobile app named "InsuMama", making the purchase of an insurance policy even easier and faster.

Green Delta has also heavily invested in building up a strong IT infrastructure towards a more digitalised and greener future.
US-based global insurer, Metlife, is also a forerunner in insurance services digitisation in Bangladesh. Online Claims Submission, Smart Customer Portal, Digital Premium Payment Channel, 360Health mobile app,  Hello Bima Hotline and Hello Bima Comics are among Metlife's innovative digital products launched in recent years. 

"Digitalisation is essential for the industry as it makes insurance services available conveniently to a wider range of people which helps making insurance more popular," Metlife Bangladesh CEO Ala Ahmad told TBS.

He explained how their digital process of claims submission benefits insurance customers. "Now every two out of three customers are using this digital claims submission tool. With the help of technological development, we are now settling claims within 3-5 days," he added.

"Insurance companies are gradually coming under digitalisation," IDRA Chairman Mohammad Jainul Bari told The Business Standard.

"We are constantly writing to companies. Insurance companies are using their own software. Customers can now see if the premium is being deposited. They can deposit premiums through mobile financial services. We want to bring all insurance companies under Insurtech.

"We are implementing the Bangladesh Insurance Sector Development Project funded by the World Bank," he added.

The objective of the project development is to strengthen the institutional capacity of the regulator and state-owned insurance corporations and increase the coverage of insurance in Bangladesh.

According to the IDRA chairman, after the project is completed, it will be tested by private companies. Private insurance companies are now working on digitalisation from their own offices.

"We will be connected with insurance companies when full automation and Insurtech technology are introduced. We will be able to monitor everything," he added.

Sheikh Kabir Hossain, president of the Bangladesh Insurance Association and chairman of Sonar Bangla Insurance Limited, told TBS, "Digitisation of the insurance sector has improved now. Customers can now monitor everything from insurance opening to closing. The entire insurance sector is now undergoing automation, which will be more so in the future."

In an event of National Insurance Day in 2022, Prime Minister Sheikh Hasina emphasised on digitisation and automation of the insurance system as well as the inclusion of new technologies in the sector.