Difference between revisions of "Best Practices from e- Insurance to e-Takaful by Sami Guello"
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Revision as of 13:47, 17 September 2016
Best practices :
from e-insurance to e-takaful
1st e-takaful seminar
Sami Guellouz Dubaï 06-04-2005 1
Overview
E-business definition
E-business strategy road map
E-insurance overview
E-takaful
Dubaï 06-04-2005 2
E-business
E-Business
Electronic commerce
m-commerce
Dubaï 06-04-2005 3
E-business
Use of of electronic means to conduct
an organization’s business internally
and/or externally
Internal e-business
Better info sharing, knowledge dissemination
management reporting
External e-business
Formulation of a sales promotion,
Collaboration with partners
Dubaï 06-04-2005 4
E-commerce
Focus on facilitating transactions and
selling of products and services online,
By internet or any other telecom
network,
Encompasses all trading steps :
Online (marketing, ordering, distribution), e-
payment
Buy-side activities (suppliers)
Selle-side activities (customers)
Dubaï 06-04-2005 5
m-commerce
Subset of e-commerce
Similar online activities
Underlying technology is more specific
Limited to mobile telecom networks
Accessed through wireless hand-held devices
(mobile phones, hand-held computers, personal
digital assistants)
Dubaï 06-04-2005 6
Overview
E-business definition
E-business strategy road map
E-insurance overview
E-takaful
Dubaï 06-04-2005 7
E-business strategy roadmap
Vision formulation
Business objectives definition
Customer value creation
Market segmentation and targeting
Organizational set up
E-business model formulation
Dubaï 06-04-2005 8
Pre-requisites
Managers need to be «catalysts of change »
Combine positive traits of both the « visionary »
and the « efficient performer »
High levels of both creativity and analytical ability
Know that ideas by themselves are not enough to
build a profitable business
Able to find new ideas by analysing state-of-the
art cies within their industry and across other
industries
Dubaï 06-04-2005 9
Vision formulation
Twofold goals :
Focus attention and effort of top
management and employees around a
common task
Encourage creativity and innovation by
expanding your thinking beyond the
existing boundaries of the cy and its
environment
Dubaï 06-04-2005 10
Business objectives definition
Objectives have to be measurable
Allow progress tracking
Ex : % of savings amount due e-
business strategy implementation
Dubaï 06-04-2005 11
Business objectives definition
Objectives have to be measurable
Allow progress tracking
Ex : % of savings amount due e-
business strategy implementation
Dubaï 06-04-2005 12
Customer value creation
Low price
Become cost leader within the industry
Differentiation advantage :
Superior brand name, high service quality,
broad product selection,
Leverage information available to create
benefits for your customers (by data
mining techniques for instance)
Dubaï 06-04-2005 13
Market segmentation
Closely linked to value creation
Two steps :
Select criteria for dividing you market into
segments
age, income for instance
Consumer (personal lines), corporate (commercial
lines)
Decide which segment to target
Segment’s needs driven products and services
Dubaï 06-04-2005 14
Organizational set up
What scale?
Analysis of expected cost structure of e-business
activities
Analysis of each activity of the value chain
Analysis of its underlying cost drivers
What scope?
Products scope
Leverage the internet to establish partnerships with
complementors
How integrated?
Which e-business activities to perform in-house and
which ones to outsource?
Dubaï 06-04-2005 15
Organizational set up
How to align physical-world strategy with e-
strategy?
Stragtegic decisions
Branding, pricing, IT and channel conflict
What structure?
Integrated into the existing organization
Leverage brand to attract customers to online channel
Multi-channel offering becomes possible, cross
promotions, shared IT
Set up inside a separate entity
Dubaï 06-04-2005 16
Business model
Cost structure?
Consider individual parts of te value chain
Production, IT, marketing, sales an after sales service
How can we use internet to lower costs across the value
chain?
Revenue structure?
Transaction fees, advertising revenues,
subscription fees (in B2C e-commerce)
Assess sustainability of business model
Intensity of competition, substitutes, etc.
Leveraging data mining techniques to analyse customer
information
Dubaï 06-04-2005 17
Overview
E-business definition
E-business strategy road map
E-insurance overview
E-takaful
Dubaï 06-04-2005 18
Business models for e-
insurance
Insurance cy’s websites
homepages of individual insurers
Products portals
Comprehensive standard websites for insurance
Aggregators
Internet insurance brokers
Online risk markets
Large risks placed with trading partners
Point of sale portals
product marketing through various theme-based pages
Dubaï 06-04-2005 19
E-insurance difficulties
Complexity of some products
Claims settlement difficult to
standardise
Internet suited for products where the
contact with the cy is more frequent
Internet viewed as insecure medium for
high amounts
Regulation (licences)
Dubaï 06-04-2005 20
Internet-product suitability
* Large commercial risks
High
* Health insurance
* Commercial motor
Transaction volume
* Annuity products
* Motor
* Index linked life
* Household products
* Term life
Low
Low Product complexity High
Dubaï 06-04-2005 21
E-insurance advantages
Important market share gain potential
Standardised personal lines insurance
Limited suitability for sale via internet
Most life and pension products, health insurance,
commercial insurance
Enormous potential for improvements in
quality and service levels
Better tailored products
Shorter reponse times
Greater flexibility in cover structure
Better risk management support
Dubaï 06-04-2005 22
E-business increases efficiency
Sales, administration, claims settlement,
claims payment expenses
decrease for both personal and commercial lines
Personal lines cost cut potential >
Commercial lines cost cut potential
High level of advisory services and tailor made
products
Dubaï 06-04-2005 23
Market entry barriers lowered
New entrants can avoid long and expensive
setting up of traditional sales network
“Lateral” from other sectors benefit from
easier access
Financial services, internet cies, banks, online brokers,
internet service providers
Internet presence and brand name to add insurance to
their product range
More efficiency
Established insurers face growing competitive
pressure
Dubaï 06-04-2005 24
Towards more integrated e-
business models
E-business makes it possible to
disseminate information quickly and in
large volumes
Traditional value chain is deconstructed
and certain links are outsourced to
specialist providers
Dubaï 06-04-2005 25
Internet impact on value chain
Product development & rating
Standardisation, data availability and analysis, new
risks
Marketing
New marketing opportunities, deintermediation,
reintermediation
Administration
Standardisation, automation
Asset management
Better information
Claims management
Automation, proximity to the customer, additional
services
Dubaï 06-04-2005 26
Potential providers
Product development & rating
Actuarial firms
Marketing
Trading cies, financial services providers, virtual
brokers and markets
Administration
Policy administrators, IT companies
Asset management
Asset managers, funds, banks
Claims management
Professional claims managers, call centres, Repair
companies
Dubaï 06-04-2005 27
Role of traditional brokers is
shifting
Standard products
Considerable competition
Products that need more advice and for
which prices and benefits are not easy
to compare
Using e-business, more finance management
and risk consulting services
Ex : complex pension products, commercial
lines
Dubaï 06-04-2005 28
Customers benefits
Greater transparency, lower prices and
improved services
E-business opens up new ways of reducing
costs
Hardening competition ensures that these
benefits are passed on to the customer
Internet offers a number of possibilities of
increasing the value creation for customers
by means of increased transparency and
improved services
Dubaï 06-04-2005 29
E-insurance conclusion
From purely info and communication medium
to important distribution channel
Focus from selling products to consumers
(B2C) to selling to commercial clients (B2B).
Internet does not only impact the distribution
but the entire business process
Challenge of continuously optimizing the
business processes
Dubaï 06-04-2005 30
Overview
E-business definition
E-business strategy road map
E-insurance overview
E-takaful
Dubaï 06-04-2005 31
Insurance not permissible
Uncertainty (Gharar)
Gambling (Maisir)
Interest (Riba)
Dubaï 06-04-2005 32
E-takaful
Prevent al-gharar, uncertainty and ambiguity
in the transaction
Provide to the consumers with comparative
informations between products available
Lead to more informed decision by
consumers
Scope of the cover, benefits and exclusions
Rate of tabarru’ for takaful vs saving
Dubaï 06-04-2005 33
E-takaful
Young industry
Can leverage on the conventional insurance e-
experience
Comprehensive e-business strategies should be
built (eventhough takaful is a high level brand)
Takafulconcept & internet suitability
E-business enhances the transparency (involved
by the takaful concept)
E-business favor the participant’s empowerment
(involved in the takaful concept)
Dubaï 06-04-2005 34
Thank you
Sources
Swiss Re, Sigma n° 5/2000
Strategies for e-business, Prentice Hall,
Financial Times
Sami Guellouz Dubaï 06-04-2005 35