Future success of the Insurance Industry

In the next 15 years, China's insurance companies will face the opportunities and challenges brought about by industry trends with a brand new look.

Insurance Enterprises need to transform to "customer-centric" enterprises and establish corresponding support processes around target customers, this includes discovering and gaining customer insights, sharing this information, and maintaining this information within the company. Enterprises also need to cultivate suitable skill combinations for employees, which is not limited to marketing and sales departments. A "customer-centric" company requires every employee to learn how to use all the interactions with the customer to enhance their understanding of the customer's needs and share the information within the company. An enterprise should also assign responsibility to the target customer group so that senior management personnel can "own" the target customer group and provide support. The organizational structure can adopt a matrix management model. The product manager is responsible for marketing and coordinates with senior management personnel to provide product portfolios to target customer groups.

Leading insurance companies can use analysis tools to discover the needs of target customers and provide products and services that meet their needs. First, we need to build a customer analytical data mart to provide comprehensive customer data from the data warehouse. Then, enterprises use all available customer information to promote understanding of the customer (the following purchase prediction) to design products and services that meet the needs of the target customer. After the data mart is built, enterprises can introduce advanced analysis and prediction model tools to use internal and external data to determine the most valuable target customers, and actively test and find the potential value of customers who have not yet been well-served.

China's insurance market is still in a rapid development stage. Most insurance companies have entered the market soon, and their business focus is mainly on business expansion, reducing sales and operating costs. As the market matures, the expansion trend of enterprises will slow down, and insurance enterprises will face fierce competition in products and services. As a result, the underwriting rate is too low and the odds are too high, the Operation Focus of insurance companies will be shifted to pricing management and comprehensive risk management including claims, selection and management of reinsurance, interest and dividend expenditures.

The enterprise-level comprehensive risk management method comprehensively looks at various risks, mitigation measures, and their impact on the enterprise's risk tolerance from the perspective of the entire enterprise or a combination. For example, through pricing management, enterprises can better manage the adequacy of premium to ensure that the underwriting rate can not only generate underwriting profits, but also maintain a competitive price. Insurance enterprises can also control clustering risks (impacts of a single event on underwriting risks) and hybrid risks (associations between underwriting risks and investment portfolios ), to manage and control the risk concentration.

Leading insurance companies not only need to assess key business performance indicators, but also need to develop and assess key risk performance indicators, implementation processes and systems to monitor and release risk indicators, in this way, risk assessment becomes an integral part of internal business decision-making and corporate culture. In addition, to improve risk management and control capabilities, insurance companies must improve data quality when obtaining source data, and provide real-time and accurate risk information as needed.

Insurance Enterprises must introduce key technologies to establish competitive advantages in the strategic direction of Operation Model Optimization, target customer potential exploration, and enterprise-level risk management.

In terms of operational model optimization, insurance companies can adopt a Service-Oriented Architecture (SOA) and apply applications based on open standard architecture.ProgramIn order to provide a flexible and standardized platform and high scalability to the business componentized operation model, we can establish advanced network capabilities and connection speeds to enhance collaboration between internal and external components, the service response capability and operational efficiency are improved through the Automatic Computing function and computing functions throughout the area.

In terms of exploring the potential of target customers, insurance companies need to establish an advanced data collection mechanism and a complete data warehouse to provide a comprehensive customer view including customer behavior data, use business intelligence and advanced search functions for effective customer suggestion management, use embedded analysis functions, advancedAlgorithmAnd the business rule engine to assist business personnel in real-time decision-making.

in terms of enterprise-level risk management, insurance companies must first establish a risk data architecture and infrastructure to provide accurate and consistent risk data with customer data and operation data, it also introduces analysis and prediction tools and models such as risk event correlation analysis, extreme event stress testing, and multi-event concurrent scenario analysis to improve the ability of senior managers to make timely and effective risk management decisions.