This is a webcast of a session focused on enrolment which was part of a 2-day (4-5 June 2013) Knowledge Sharing Forum on Technology for Microinsurance organized by the ILO Microinsurance Innovation Facility with CGAP Technology Program and Microensure. The session focused on technology solutions, specifically smart cards and mobile phones, and how these solutions are addressing enrolment challenges. Panelists include Pranav Prashad of the Facility, Camilo Tellez of CGAP, Eugene Adogla of Microensure, Sanjay Pande of Amicus Advisory, and Jasmin Suministrado of the Facility as moderator.

1. 1
Technology: Improving the
enrolment experience

2. 2
Technology:
Improving the
enrolment experience
Presenter:
Sanjay Pande
Director
Amicus Advisory Private Ltd
Presenter:
Pranav Prashad
Microinsurance Officer
Microinsurance Innovation Facility
Presenter:
Camilo Tellez
CGAP Technology and Business Model
Innovation Team
Presenter:
Eugene Adogla
Regional Operations Manager-Africa
Microensure
Moderator:
Jasmin Suministrado
Knowledge Officer
Microinsurance Innovation Facility
4 June 2013

3. 3
Discussion Flow
1. Challenges in microinsurance enrolment
2. Technologies for enrolment
2.1 Smart cards
2.2 Mobile phones
3. Watch points in implementing technology solutions
4. Concluding thoughts

4. 4
1. The Main Hurdles in Enrolment
Identification
Infrastructure
Education and
awareness

5. 5
Challenges in enrolment
 Identification/ documentation
requirement
 Unclear forms- long, time
consuming
 Complex processes- low
awareness
 Lack of Interaction: who to
ask
 Liquidity constraints
 irregular income flows
 Non synchronous
schedules
 Prioritisation
 TRUST
 High costs
 Lack of channel and
physical infrastructure
 Insurance agents
 “low prioritisation” of low-
income markets
 alternative channels (post
offices, retailers, banks)
 Clients’ understanding
Client side Provider side

6. 6
Clients’ needs and technology
requirements
 Trust and active communication
 Does technology enhance or dilute these aspects
 Human connection- repeated contact, reminders, physical
presence
 How well does technology simulate
 Relevant locations, timing, interface personnel for interaction
 responsiveness
 Facilitate and comfortable environment
 Relevant processes- clients 'capabilities and limitations
 Ease of understanding, transaction and confirmation
 Tangible benefits throughout the policy duration
 Protection beyond the less frequent event or loss
 Facilitate “Value added” services, linked to the product…

7. 7
2.1 Smart card Technology
Current popular applications
Identity
Banking & Financial Services
Access control
Transportation
Telecommunication
Healthcare
Nos. in circulation: 6.9 bn
(Figures for 2012 : Source : Eurosmart-April,13)
Telecom : 5.1
Financial Services : 1.2
Government Healthcare : 0.31
Transport : 0.13
Pay TV : 0.13
Others : 0.09

8. 8
Smart card technology: Benefits
 Digitisation of base data
 De-duplication
 On-site Activities : No remote
locations
 Instant enrolment
 Spot data amendment and
personalization
 Instant printing and issue
 Instant uploading addresses
transit related issues
 Seamless mapping of
biometrics and demographics
 No mismatch
 Instant activation
 No waiting to avail of benefits

9. 9
Hardware
Laptop with webcam
Fingerprints Scanner
Smart card Reader
Printer
Fingerprints Reader
Smart card technology: Hardware and
software
Enrolment Software
• Identification, collection
of demographics &
biometrics
• Personalization, printing
cards issuance
• Data collection,
conveyance and
management
Claims Transactions
Software
• Identification, admission
treatment
• Data conveyance and
management
•Financial transactions
Other
• data integrity and
security

10. 10
Smart card: Enrolment process flow

11. 11
Smart card implementation
Pilot project supported by the
Microinsurance Innovation Facility
 Health Insurance Scheme for handicraft
artisans, funded by the Government of
India
 Project locations: 3 districts in East India
 Households Enrolled: 2,768
 Hospitals / clinics networked: 44
 Claims reported till 19th
May, 2013: 1,950
 Benefits afforded: Outpatient and inpatient care
 Focus: Outpatient care
National Health Insurance
Scheme ( RSBY)
 Health Insurance scheme for the
population below the Poverty Line in
India
 Locations: 26 State, about 525 districts
 Households enrolled: 35 million
 Hospitals networked: over 9,500
 Claims reported: 5.2 million
 Benefits afforded: Inpatient care only
Pilots in Outpatient care

12. 12
Smart card technology: Successes
 Reduction in waiting time
 Credibility enhancement
 Benefits afforded with no time lag
 Reduction from 45-60 days to 25 minutes in the Pilot Project
 Better enrolment ratio
 Convenience leads to greater participation
 Improvement by 8% in the Pilot Project
 Reduction in the enrolment cost
 Optimal utilization of resources
 Fixed costs defrayed over larger enrolled population
 Renewal costs minimal
 Reduction by US $ 0.15 in the Pilot Project
 Control over malpractices
 No multiple cards for one households
 Better data management
 Efficient and reliable capture, conveyance, storage and retrieval

13. 13
Smart card technology : Challenges
 Limited enrolment period window
 Many are left out
 Migratory population
 Source location or working location
 Data managed at multiple points
 Multiple Insurers are involved
 Central Repository of data required
 Technology still intimidates many
 Misgivings about fingerprinting & phototaking
 Higher levels of client education is needed
 Hardware supplies
 Oligopolistic market
 Operational constraints
 Power supply
 Internet connectivity

14. 14
2.2 Mobile phones
The Microinsurance Value Chain and Mobile infrastructure

15. 15
Microinsurance growth in Africa is mobile
Growth in Africa
2010-2012: 200%
 8 of 9 markets outside South
Africa with more than 1 million
insured have reached that mark
through mobile insurance
 Source: www.mfw4a.org/insurance/microinsurance-landscaping.html

16. 16
Why mobile microinsurance?

17. 17
Mobile insurance models
1. Passive Loyalty:
 Given by MNOs in return of post-paid voice
loyalty
 Most products are offered free of charge
 No mobile premium payments or even information
and administration
 About a third (34%) of the products are free
loyalty models
100%
Tied
100%
Free Bundled
Tiered Compulsory
0%
Facilitator
MNOs aiming for passive loyalty

18. 18
Mobile insurance models
2. Active Loyalty:
Offered to not just increase loyalty but to raise ARPU by
incentivizing various kinds of behaviours. (mobile money
transactions, savings balance, etc)
Coverage is linked to airtime use or top-up, the frequency of
transactions or deposit balance.
About a third (38%) have a tiered offering where customers
can either choose their coverage level or are awarded different
levels depending on use of the core service
Tied Free Bundled
Tiered Compulsory Facilitator
MNOs aiming for Active Loyalty

19. 19
Mobile insurance models
2. Paying models:
a.Freemium model
 Based on premium payments rather than driving
indirect revenue through incentivizing activity
 Only a couple of freemium models: Tigo Ghana -
Family Plan, and Vodacom Tanzania – Faraja
 Most send policy information and at least half
allow some form of policy administration via the
phone
b. Full premium model

20. 20
Tigo – Ghana, Tanzania, Senegal
AGENT ASSISTED
Phase 1: Free Life
Insurance
Phase 2: Life and Hospi-
Cash paid via airtime
MTN - Ghana
AGENT ASSISTED / SELF-
ENROLMENT
Mobile Money Life
Yu - Kenya
SELF-ENROLMENT
Phase 1: Free Life &
Disability Insurance
Phase 2: Free Life,
Disability and Hospicash
Mobile insurance examples from MicroEnsure

21. 21
Mobile insurance: YuCover (Kenya)
- Initial Marketing +Education: USSD
- KYC Harvesting: USSD
- Initial Sale USSD
- Enrolment Confirmation: SMS
- Cover Confirmation and Continuous
Marketing + Education: SMS

22. 22
Enrolment process with mobile phones

23. 23
Technology and process evolution
Mobile tech is great, but care must be taken ...

24. 24
Payment mechanisms
24
Airtime vs. Mobile Money

25. 25
 Telecom viability:
 yuMobile, Kenya – “yuCover is the most successful
product we have ever had for ARPU and churn”
 Insurer viability:
 Vanguard Life, Ghana: “Tigo Family Care Insurance the
most profitable product in the portfolio”
Impact on providers

26. 26
Mobile phones: challenges
Telecom viability:
 “Free” product loses value after 12-18 months
 Cost of agents in Ghana is too high to sustain
 Mobile money-only products are currently limited to Kenya,
Tanzania, Uganda, where there are many active mobile
money users
Insurer viability:
 Voluntary, paid-for products attract anti selection, risk rate
must be 3-5X that of free products for same cover
 Telecom viability:
 “Free” product loses value after 12-18 months; Whereas P2P
interaction was crucial in Phase 1 success, it is costly once sign-
up growth flattens
 Cost of agents in Ghana is too high to sustain; evolution to
mobile based enrolment is next logical step to maintaining low-
cost sales structure  Costs crash by 99%+
 Insurer viability:
 Voluntary, paid-for products attract anti selection, risk rate must
be 3-5X that of free products for same cover; complex products
 tighter messaging needed on terms of cover; tighter KYC
extraction needed  standardization by mobile technology
complement traditional risk management

27. 27
Mobile phones for enrolment: challenges
 Illiteracy, poor facility with using VAS beyond voice which
should be factored into interface design
 Technologies not fail-safe
 SMS not delivered
 USSD server down
 Need for good backups
 Human agents
 Telco service centres

28. 28
Payment mechanisms in Ghana:
challenges ahead
1. MTN Ghana:
• Decision to tie the product to MTN mobile money
• MTN explicitly wanted to promote mobile money
signup/activation.
• 20,000 customers and uncertain viability
1. Tigo Ghana:
• Decision to go for airtime
• Tigo the insurance was seen as a voice loyalty
play which has nothing to do with mobile money
and sits in an entirely different team
• 270,000 paying customers
The choices reflect the different objectives the companies had with the
insurance product.

29. 29
3. Watch points in implementing
technology solutions
 Not use technology for technology’s sake
 Identify problem and then decide on a technology solution
 Have a problem that technology can help solve rather than
a technology in search of a problem
 Technology not an end in itself- needs support to be
successfully implemented
 Connectivity challenges
 Hand held machines vs. mobile phones
 Process enhancements

30. 30
Watch points in technology
implementation: Smart card
 Infrastructure
 Power
 Internet connectivity
 Base data
 Enumeration can be very challenging
 Manpower
 Basic IT skills with enrolment
 Buy-in from service providers
 Deferred payments
 Pre-packaging of procedures & charges
 Information and Education Campaign
 Localized, high-impact
 Hardware
 Capital intensive , for the first 2 -3 years
 Software
 Smart card -related software: enrolment, claims
transaction, ensuring data integrity for data
security (India would be keen to assist)
Migrating from manual
to smart card regime

31. 31
Watch points in technology
implementation: Mobile phones
 Enrolment: USSD, SMS, etc. have limits – number of characters in
messages, short session times, etc., so…
 define what is technically needed
 strike the right compromises for target market, products
 squeeze the holistic barest essentials into as simple a number of
steps/deliverables as possible (all T&Cs in one SMS, for
example!)
The fewer the steps, the better the customer experience
= greater scale!
 Outcome is mixed so make sure the model is aligned with the
objectives and take into account market maturity and customer
understanding of the product.

32. 32
4. Concluding thoughts
 Technology should be approached critically to ensure that it is not just an
appendage to old ways that do not work for achieving scale; new solutions
needed
 Technology is not to be viewed as a stand-alone initiative – Multiple programs
can piggyback on the smart card platform and must have process synergies
 Cooperation between mobile operators, intermediaries and insurance providers
can result in innovative business models. It is important each organizations'
objectives are aligned to ensure higher likelihood of success
 Technology can significantly impact ability to control and adapt. However,
success depends on how people use technology based interventions …. amplifies
both good and bad business practices

33. 33
Technology:
Improving the
enrolment experience
Presenter:
Sanjay Pande
Director
Amicus Advisory Private Ltd
Presenter:
Pranav Prashad
Microinsurance Officer
Microinsurance Innovation Facility
Presenter:
Camilo Tellez
CGAP Technology and Business Model
Innovation Team
Presenter:
Eugene Adogla
Regional Operations Manager-Africa
Microensure
Moderator:
Jasmin Suministrado
Knowledge Officer
Microinsurance Innovation Facility
4 June 2013
ON
Q&A