The wave of emerging technologies like automation – RPA, AI, ML; Blockchain, wearables and others have impacted businesses including travel insurance.
The space of insurance has commoditised and the new age born in the cloud insurance companies are leveraging technology to enter into new areas, empowered by technology tools to provide seamless and superior service experience.
Flight delay is one such area. Especially during the winter season, due to fog related reasons or in the rainy season. There are insurance companies, who are providing flight delay insurance and disbursing claims proactively even before they are filed for.
Digit General Insurance (DGI) offers domestic flight delay insurance. In the business mix, the travel insurance contributes 39 percent, which is the second biggest LoB for DGI. The claims process is automated and simplified, for e.g. In case, the flight gets delayed by 60 mins, DGI informs the customer proactively. “Usually, the customer forgets that he has bought an insurance policy. Hundred percent of flight delay claims are automatic, the passenger gets an SMS, in reply to which, he sends his boarding pass and bank details as soon as the flight is delayed beyond the given time. We also have partnerships with various players to monitor the domestic flights. The analytics runs at the backend tracking how many customers who have bought the policy from us and are travelling in the same flight,” explains Gangadhar S J – Head Technology – Digit General Insurance. The systems are developed inhouse and they are programmed to track the flights 24*7.
Following is the Business Mix of Digit General Insurance: Travel Insurance 39%; Motor 42%; Personal assets including Mobile 19% in Volumes.
Blockchain for flight delay insurance disbursal
Bajaj Allianz General Insurance is providing Blockchain based flight delay insurance – ‘Travel Ezee’, to its policyholders for international flights. Travel Ezee was launched in June, 2018. The claim is automated if the flight gets delayed by 6 hours. The target is to bring it down to two hours. “The insurance companies are hesitant on paying claims. Thus, this is a customer experience and acquisition strategy, and we want to pay claims, even before its filed by the passengers,” says Sourabh Chatterjee, President and Head – Technology, Direct Sales, Travel, Bajaj Allianz General Insurance.
The objective is to make the customer realise the experience on service and convince him to buy the other travel products from Bajaj Allianz General Insurance. The travel insurance is highly commoditized and Blockchain can prove to be a differentiator in immediate claim disbursal.
Why Blockchain and not any other technology?
Insurance is basically a contract between the passenger and the insurance company, with many other stakeholders involved – the travel aggregator, banks, etc. Blockchain, with its characteristic of being immutable i.e., it cannot be tampered with, when its used to host the insurance contract on a cloud platform. The smart contract put on a cloud brings all the participants in the contract on a common trust platform, wherein the smart contract is hosted on the systems of each of them. It drastically eliminates any scope of tampering, which is difficult to do with other technology options available in the market.