EP 114 – Thomas Dijohn – SVP Asia-Pacific at dacadoo – Banking Is a High-Frequency Environment, Insurance Is Not

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Michael Waitze has been podcasting with some of the best investors and business builders globally and discussing all things startup with them from an Asian perspective. Michael worked in Global Finance for more than 20 years, employed by firms like Citigroup, Morgan Stanley, and Goldman Sachs, primarily in Tokyo. Michael always maintained a particular focus on how technology could be used successfully to make businesses more efficient and to drive P/L growth. Michael is quite skilled at connecting people and capital to innovative ideas and is a trusted advisor to both investors and founders. Michael is a leader in the digital media space, having pioneered the concept of a podcast network in Asia while building the biggest and fastest-growing listener base in the region. His flagship website, AsiaTechPodcast.com, has listeners in over 130 countries and is available on virtually every podcast player that supports RSS feeds.

Thomas Dijohn has been with dacadoo – a leading Swiss technology company working with digital health engagement and enhanced underwriting – since 2015 currently serving as the Senior Vice-President Asia-Pacific. Prior to dacadoo he was on a secondment to Sanofi – the world’s 5th largest pharmaceutical company – as Intrapreneur-in-Residence - to develop and implement a clinical behavioural diagnostic tool for the management of people with chronic conditions and for prevention in general. He has previously also worked with Innovation, Strategy, and Growth in industries such as Media, Telecom, Managed Services, and Consumer Goods – the last 25 years in Asia.

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The Asia InsurTech Podcast spoke with Thomas Dijohn Senior Vice President Asia Pacific at Dacadoo about living in real time, ecosystems and data analytics.

Michael Waitze
Hi, this is Michael Waitze, and welcome back to the Asia InsurTech Podcast. This is the only podcast in Asia focused on insurance that gives entrepreneurs, thought leaders and investors a platform to discuss how technology is reshaping the insurance industry in Asia. On this episode, we are very excited to be joined by Thomas Dijohn, Senior Vice President Asia Pacific at Dacadoo. I do love Thomas, I do love the name of this company. By the way, I want to know why it’s called that. But anyway, thanks for coming on the show. How are you doing today?

Thomas Dijohn
I’m doing very well. Thank you for having me.

Michael Waitze
Yes, so typically, what is the name? Where does it come from? Or is it just like a bunch of sounds? No idea.

Thomas Dijohn
Well, the The funny thing is I’m based in Australia, right? And we you know, we have a lot of doos down here, kangaroos and didgeridoos, ephedra when people are thinking Australian name, but in fact, it’s not. Exactly but in fact, it’s not right. We’re Swiss business. And when the company was founded, they actually had a quite a scientific name. So our founder, Peter Ohnemus thought that we use something that was better aligned with what we stand for. And he came up with this idea that Dacadoo is apparently the rhythm of life. I’m not sure which part of life that rhythm sounds like Dacadoo. But apparently, that’s where it comes from. So I don’t know if your heart rate or the way you move or whatever it is. But supposedly Dacadoo is the rhythm of life. And given that we work in predominantly in the health and wellbeing space, that makes perfect sense. So it’s not Australian, not at all.

Michael Waitze
I thought when I first met you, right, because when we first spoke, you were in Australia. And I thought, Oh, I wonder what that means from an Australian perspective. But fair enough. Let’s do this first, but what do you think is the biggest trend in insurance and InsurTech in Asia?

Thomas Dijohn
The funny thing is, if you ask 10, people, you’re probably gonna get 10 different answers, because I think it depends on which has your way. Right. But I think that the things that comes out quite frequently, in my conversations, there’s really a number of them. One of the things is, how do we make ourselves more relevant, who may be a younger population, a more digital population? I think the, and the challenge, of course, is here that you have a you know, insurance historically is not very digital, and to a large extent, still not is today. And you have people that are 40 to 45 years and younger, who are doing most of the interactions and digital fashion. So there’s a lot of focus on what does it mean to become a digital insurer, which, as I mentioned, in the past, is more than just taking your application and turning it into a PDF file. It requires a company’s transformation, which I’m sure we’ll talk about later, as well. So this, I think that the big trend is how do we how do we make ourselves interesting to to a younger community? I think another thing is, in Asia, we have these really exciting digital consumer platforms, you know, the types of Amazon and Flipkart and Grab and Gojek and, you know, WeChat, Kakao Talk, Line et cetera. And a lot of insurance is very keen on tapping into some of these digital ecosystems, which is a huge opportunity for them. But many of them also faced with a bit of challenge because of the different expectations once you get, get onto such an ecosystem. And I think the third thing that comes up a lot is really on, that there’s so much data available now coming from different data sources, and insurers are really keen on getting access to some of that data to give them a much better understanding of what risk am I actually faced with at any point in time? But also, how can I use some of those more data points to create a more refined and more relevant insurance product? If you only have five parameters, product per definition that are very generic in nature, right, so so I think these are probably the things that comes up most often, you know, I could have a very long list of things. But I think these are very key trends that we see all the time.

Michael Waitze
This is a killer list. Actually, we’re gonna have to dig deep into actually all three, because I’ve got plenty of questions about it. Can we just back up for a second? And for our listeners, just get a little bit of your background for content?

Thomas Dijohn
Absolutely. I got quite a mixed background. So you can hear from my accent. I’m actually not an Australian. I’m originally born in Denmark. sound from Copenhagen. So I’m a Viking. But I left a bit more than 20 years ago and lived in Singapore, lived in Taiwan and now living in Australia. I got to my original background is actually marketing then I moved into consulting and strategy. And that’s still very much the way that I think and operate. And then I worked a lot sort of mixing between startups and more mature businesses. So Dacadoo, of course reasonably you can call a start up. Now we are 10 years old, so maybe less so. But in startups you have, you know, it offers certain interesting opportunities and freedom and flexibility. But what you are missing inside of it, maybe some structure and discipline etc. So what I’ve done before that is to work off a Xerox Corporation, for instance, and within a huge company, and in there, you don’t have necessarily the flexibility and are not as agile, but then you have really good, you know, frameworks and methodologies and processes, which is tremendously useful as well. So a bit of a difficult person to put into a box, because I kind of flip floped between mature and startup environments. But the common theme is very much rather the marketing, building things.

Michael Waitze
But this is actually really interesting, right? I mean, I don’t know if you know this, but I spent most of my career working at Morgan Stanley and Goldman Sachs. You know, when I joined Morgan Stanley, I think there were 4000 people in the company, and then it was acquired by what was it? Dean Witter? I can’t remember. But there were then there were like 100,000 people, and it just turned into a completely different place. Goldman was obviously huge as well and had offices all over the world. And for me, I didn’t understand because it was the only experience I had ever had, like, how important that infrastructure was just the fact that there were things there. And when you leave, that’s you’ve done both, right? But when you leave that and end up at a startup, if you’re not going back and forth, like you’ve done, if you did what I did, when you’re in the startup world, you’re just like, well, where are all my resources? And how am I gonna get? It takes a while to figure that out? No.

Thomas Dijohn
Yeah. I mean, for myself, it’s okay, because I’m so used to it. Right. But But certainly, some of the people that we have brought on board Asia comes from insurance. And there’s a bit of a steep learning curve when you’re when your infrastructure disappeared, right.

Michael Waitze
You get nervous.

Thomas Dijohn
Oh, yeah, absolutely. But, but I think it’s good to have that background, because it gives you sort of a sense of clarity when you approach things right. So and, yeah, so yeah, so a bit of a mixed bag.

Michael Waitze
So why do you think, at least in Asia, but maybe true globally, as well. But again, you and I have been residents in Asia for 20 to 30 years? mentioned this, I just want to dig a little bit deeper. Why do you think that, it’s taken longer for insurance companies, unlike investment banks, and banks, to digitize? And before you answer, a lot of people say, well, it’s heavily regulated, but the trading markets in the banking businesses are really regulated as well. Why do you think that that digitization is taking longer?

Thomas Dijohn
I don’t think it has anything to do with regulation, I think it has to do with the fact that people are simply using banking much more often than they use, say, an insurance product and banking, you have a direct relationship with a bank, whereas in most situations, with the insurer, you go through some form of intermediate, right. So so you know, we I mean, I take my bank account once in a while I check my, you know, pension investments wherever you have. So you know, banking is a relatively high frequency environment, insurance is not. So when you have a world that’s going digital, and you have that high frequency interaction. Of course that put pressure on the banking to, keep up as well. Where insurers have been somewhat shielded by that because they work through intermediate as well. So that’s how I that’s how I see it. It’s nothing to do with regulations. It’s all customer driven.

Michael Waitze
But this actually brings together a few other issues, right? In other words, do you think? And is this happening as well? Do you think insurance companies should figure out a way for lack of a better term to be more engaged with their customers, you’re right? Life insurance, health insurance, most people, they buy it, and then they just kind of put it in a drawer somewhere, metaphorically, and don’t ever interact with the insurance company until it’s time to make a claim or until they think I need to get some health care? What is my policy? Is there an efficient way or even an effective way for insurance company through digital transformation? To be able to engage with their customers in a way that makes it more important? Is that fair?

Thomas Dijohn
Yeah, absolutely. I mean, that there is a need, you know, we have this generation, I don’t know X, Y, Z, whatever, they’ve lost track of who they are. But But you know, I mean, anyone that’s sort of 45 and younger, whatever. That’s, you know, this, this whole tendency where people tend to make less and less commitments for the longer term. You know, we’re seeing people are going they’re renting, they do Airbnb, they don’t own cars, they go sort of a Uber, you know, and and, you know, they don’t sign up for phone plans to go month by month, right. So it seems to be sort of a more you live in real time. Right? And, you know, if you look at health and life insurance, obviously very different proposition. To start with a life insurance, you know, all things equal you’ll be making, you’ll be signing up and say when you’re 30 years old, and you might be making your first claim 30 years later. Because it’s typically a disability or it might be death in which case you’re not making the claim someone else is making on your behalf. Right? And that’s a bit of an issue because if people are not thinking that long term anymore, and you’re selling them a what-if scenario, but everyone’s lives in the now, you’ve got a huge disconnect between where people are today and what the insurers are offering So, and with health insurance, maybe less so you can say because they tend to have maybe a higher frequency interaction, because people might be making claims. So every year every second year, so. But broadly speaking, there’s a real risk for the industry to be become irrelevant, because they simply follow the cliff, they’re no longer part of the radar, because the center of the radar are things that you need on a daily life and things seem to interact with them today life. So there’s a real need for insurance to find an avenue that makes them relevant in people’s lives. and this is, of course, where we work in our company, right? And one of the things we work with insurance on is exactly on, how do you create, given that this is a product that people don’t, you know, they don’t request, they’re being sold the product, they buy it out of necessity? And less and less people don’t think about the longer term, they only think about the Now, how do you make yourself interesting? How do you find an opportunity to talk for people right now. And we claim in our company that health is a good topic, right? It makes sense for Life and Health Insurance and talk to the customer about their health, because health and life is ultimately all about health. And in our view, it also makes self sense for the end user to talk to an insurer about their health and health is something that people are becoming more and more mindful of. Younger people might be more interested in visual aspects, you know, with fitness, and gyms and all that, older people are getting more and more concerned about, you know, being independent, retain mobility, etc. Because they live longer. So long story short, engagement around the theme of health makes perfect sense for insurers to do. And that’s the way to go in my mind.

Michael Waitze
So does that mean this is actually really interesting to me and I hadn’t thought about it this way prior to this. But does that mean that insurance companies through digital platforms should be more involved in places like and I was gonna ask you this, but you mentioned that anyway, with gyms and fitness centers, and like vegan restaurants, and any place where healthy people are going to try to become is, it’s the frequency that we talked about, right? That makes it relevant, right? Every day I do X, I brush my teeth. So I need to have a relationship with P&G, or some other company that makes toothpaste. If I didn’t imagine once a week thing, or once a month thing, I wouldn’t really care. But can they get insurance companies get involved through digitalization in my day to day, you know, exercise or my day to day diet. And when I say diet, I don’t mean my desire to lose weight. I just mean the food that I intake. How does that work?

Thomas Dijohn
So it’s, uh, yeah, I mean, absolutely. I mean, there’s a lot of talk about ecosystems and being your platform place and all that. I think you’re the beauty of the digital world is everyone’s connected to each other, right, you go in one place, you click a few buttons, just suddenly, somewhere in another place, right. And an insurer needs to get involved in that as well, because that’s the, that’s the predominant way for people to, that that’s the area they live in everyday. They live in platforms and live and live in ecosystems, right. And for, the consumer really dictate what they expect from an insurer and it’s gonna differ a lot, I think on where you are in your life stages, right? So if you are used to say, if you’re a younger person, you might tend to be a bit more interested in you know, there’s a whole Instagram generation right now, how do I look, I want to feel fit, you know, I want to be attractive, you’re maybe more they’re more interested in sort of the wellness fitness side. So absolutely makes sense that you integrated your gym, maybe their equipments, or maybe you would sign up at a local grocery shop, they can shop wherever maybe as well, you get some points for buying the right. Excellent and a certain restaurant, it makes perfect sense. As much as it makes sense. If you are an older person, maybe at risk, you would link up with your pharmacy and healthcare providers, etc. Right? It really depends on where you are in the life stage and what you’re, you know, what relationship do you have with health and people’s relationship with health changes our life and an older person like me, you know, tends to an old person like me, think, you know, an old, an old person like me, tends to be more concerned about the health, right, because you begin to have friends and families that have your certain conditions, right. My kids don’t care about health. They care about their fitness, right? So yeah.

Michael Waitze
So one of the other things you mentioned were these digital platforms as mechanisms and you didn’t say it directly, but I wrote it down for distribution, right. So you have these big companies like and I’m going to name some of them you said to Gojek and Grab and what did you say? Traveloka, all these big all these big sort of companies are trying to get interested because they have a lot of people downloading their apps. So the interesting question I had, and they’re also trying to get into the insurance business, right? So Grab through its Grab finance, business and Grab insurance business. GoJek’s doing the same thing, all these Kakao all trying to do the same thing. Is there a way for an insurance company to flip the bit, and I’ll tell you what I mean, and just start a ride hailing company. So in other words, it because you mentioned this before, and it just makes me think about this. Because people don’t have a direct relationship on a day to day basis with their insurance company, then they don’t understand where that stuff is coming from necessarily. They forget about it, right? They buy, they put it away, and they forget about it. And because there’s an intermediary in the middle, whether it’s an agent or somebody else that actually sells them that insurance or delivers that insurance to them. So why wouldn’t the insurance companies either as a group, or as sort of factions get together, start an e-commerce company start a ride hailing company, and instead of putting another intermediary in its digital build their own, if that makes sense?

Thomas Dijohn
Conceptually makes sense. But it comes back to what you and I talked about in the beginning, that is, you know, what’s the mindset of people, right, insurance are designed in a way where, for instance, they have a definition of very risk averse, right. So I don’t think insurers necessarily have the, the DNA to go out and build these companies, but conceptually makes sense. And I think with the, you know, the inspiration could come from the airline companies, for instance, you have, say, in Singapore, you have Singapore Airlines, they, like Qantas, have done Australia, like many of the airlines have done say this, and we’re never gonna be able to do, a no frills airline within our own brand, when you first start a completely new business, right? So Singapore airline started Scoot, Quantas started Jetstar, etc, etc. And I think , that’s a smart approach. You know, if you want to do something differently, you create a separate entity with a separate team and different capabilities as well, and let them go. And you need to keep them outside the regulation of insurance as well, because there’s a lot of extra thing in there. Right. So that you could do that. Absolutely. I think though, what was was important to have in mind is that if you look at the insurance value chain, you know, you’ve got your distribution, you have your manufacturer, you do the underwriting, you do the claims, etc. I think the margin and a whole valuechain is somewhat shrinking, right, becoming a more commoditized market. And I think insurers needs to potentially decide on what role they want to play in the value chain. You know, do you still want to spread yourself on both the distributor, manufacturer, you want to do claims? Do you want to take on risk? You know, do you want to cover a wide range of products as well? I think that’s something in that insurance needs to consider. What am I really good at? You know, what you know, and the reality is, if you go to someone like an Amazon, as an example, Amazon will sell anything, they got, you know, millions or hundreds of millions of relationships. Anything you want to sell, Amazon will sell, the same will Flipkart as well. And the big question really is can an insurer in the digital economy compete against these? Or should they partner with them? I think they should partner with them to be honest. Because you might remember for some previous conversation you and I had I often refer to in China and what I call contextual selling, right? How do you get how do you make an insurance product relevant to a user? Well, on his own right, the digital consumer doesn’t see insurance products as being relevant to them less and less so. But if you like in China, if you package it into an experience, process, a buying process, and then you propose the insurance product in that context, then suddenly it becomes logical for you to buy an insurance product. And that you can only do if you can tap into greater ecosystem. So you want to sell a car insurance, you got to tap into the process of buying a car, you want to sell, you know, health insurance, you’ve got to tap into another process as well. And this is why I think the insurance companies are going to come short, long term.

Michael Waitze
What do you think about personal injury insurance? In other words, for every youth soccer league and youth basketball league, and youth tennis league, and all this stuff, right? These kids go out and play and sometimes they get hurt. It would be neat if there was a way to distribute it to them, I’ll say on the court, because there’s no there’s no insurance that I know of that targets kids. And it would be neat if they could just like on their phone go, oh, I’m gonna be playing basketball this weekend. I should just get a little bit insurance in case the ball breaks or I twist my ankle and I’ve got to get an ambulance. And I may not have it may not even know what insurance my parents have. Is that a relevant market at all?

Thomas Dijohn
I don’t know how big the market is. But as a concept, yes, because it’s very equal to what you’re finding cars and pay-when you drive, right? So they started by just pay at any time, then it moved to, you know, pay as you drive, but now becomes only pay when you drive. So when the car is in the garage, you don’t pay, right. So I can see no reason why you would not be able to apply that to other situations such as, hey, I’m going on a ski holiday, I’m going to ski now from nine in the morning until, and you basically you’ve got an app or you allow tracking and you do that and bang, then you you pay for that.

Michael Waitze
Yeah, I mean, I think it makes perfect sense. I’ve been talking about this to people, right, because I don’t see any penetration there at all. Actually, I think it’s I think it’s a decent sized market. Can we talk about this too, again, just from your experience? What has to change in Asia? Like I said, you and I both been here for a long time. But insurance penetration is really low, I get the relevance thing. But is there a GDP per capita issue as well? In other words, do you think that naturally as GDP per capita increases, that insurance itself will increase as well as a product?

Thomas Dijohn
Yeah, I mean, yeah, yes when GDP goes up, affordability goes up. And when affordability goes up, I also think people have a greater need to protect what they have gained, you know that as you come through different generations, people are maybe been born into poverty, and then they move and go up into wealth. But But I think that’s probably the obvious answer, really. I really are often being often insurers says to me, you know, the reason why people don’t buy insurance is an affordability issue. And I don’t necessarily subscribe to that, I really think it comes back to the fact that insurers are trying to sell apart and make no sense to to, I wouldn’t say to anyone, but to a lot of people. I really, I really think insurance needs to think about what is what is they offering, again, financial protection is a very, very long term thing. And I often I often say that, if you go and ask, and this is just a hypothesis, I’ve never proven it. But if you if you’re going to ask 100 people and say, Would you rather like to pay to protect your existing good health? So health assurance? Or would you rather like to protect your health in case, you know, protect yourself against damages? If you have an unfortunate event? Right, I would argue the majority will say, you know, what, a rather like to protect my existing health. Right, you know, and I’ve got a full bag later, which is my financial protection. Right. And I still seem to come back to that, of course, it is an affordability issue as well, right.

Michael Waitze
But I think this gets back to this. And I wrote this down, right, this concept of you live in real time, I think the younger you are, the more you live in just the moment in real time. And that’s why I think there’s this skewed towards, I want to protect what I have right now, as opposed to sort of this long term viability of my health. I just want to make sure I’m okay, now. Yeah.

Thomas Dijohn
Yeah, absolutely. Absolutely. And, you know, this test is clearly proven, from a behavioral basis that people are much more encouraged to protect what they have, rather than what they may gain. Right. So I think that’s that, again, you know, if you can protect what you have right now, rather than, you know, something that may have been filtered down the road, I think, you know, that’s the way it works. If you look at AIA Vitality out here, for instance, with their Apple Watch campaign, they give you an Apple Watch. And then you have to do a certain amount of activity. If you don’t, you’re going to lose it. That that that might be I think that’s a really a really good idea, as opposed to say, Hey, why don’t you go and do exercise for 10 years, and we give you a watch. The pain of losing, I think, is greater than the pain of gaming. Right? So

Michael Waitze
Yeah, and it works both ways, right? Because from a customer acquisition standpoint, if it costs me $400, and I probably get a discount on it. So like, excuse me, $350 to give you an Apple Watch, and you’re incentivized to be healthier. Yeah, then I have to make fewer payouts to you for claims, right.

Thomas Dijohn
Yeah, absolutely. So, but I think I mean, we often hear in all the industries about micro insurance, and I think there will be micro insurance coming out as well. In health? Well, it is when you do a specific event, or you travel to a certain area where it might be exposed to a greater risk, or, you know, insurers begin to map out situations where they are no risk or low risk, and then another situation for that higher risk and move and much more into a usage-based insurance product. Absolutely. It makes perfect sense. And that makes it certainly more affordable as well for some from some of the low income countries.

Michael Waitze
Right. So one of the things you said earlier was you at some level, there are some products that are being offered that people don’t necessarily want to buy. If you get really deep in the weeds. Is there a personalization possibility? Like a really meaning like just for you, like just for Thomas, I need different insurance than you need? And does data play a role in this and technology as well? Or is that just is a kind of a pipe dream that people like to talk about.

Thomas Dijohn
Technically, you could do it. But as you know, it, this is a regulated environment. So when you design products, you know that there’s only so much flexibility you can do, because every product has to be approved by regulator. So I think it is for the time being maybe a bit of a pipe dream to really get into your personal insurance, individualized insurance as well. But I definitely think that we’re I mean, when if an insurer engaged in end use in some means and collect far more data, you have far more parameters to customize the experience, right? So you can both go back and say, Hey, Michael, I noticed that you do this occasional football every Sunday, do you know I have this football cover that you can pay for every Sunday? Right? Or are you do you know, activity every day? So I got a ride off a sports injury or something else? I think that level? Absolutely. Also think in terms of the the cover, yeah, it can be more personalized. But I think to go to a real individualized insurance, that requires a big change for the regulator’s to be honest.

Michael Waitze
Yeah, I wonder sometimes if there’s a way to create technology that allows the regulatory framework also to be digitized, right? They’ll do have sandboxes, right. But instead of having to go verbally, and fill out forms and do that stuff with the regulator, to create a digital framework for what’s okay to even just put into the sandbox, at least to start as a test, and then feed through an API, that personalized product so that they can get sort of instantaneous approval. Does that make sense? The reason why I talked about this is because remember, I used to trade, right? So we built all these sort of very small systems that connected together to allow things that didn’t seem possible to happen instantaneously. And that’s why I’m asking right?

Thomas Dijohn
Yeah, yeah. It’s, it’s an interesting question. Because in insurance, of course, you always talk about how do you pool risk? And how do you manage, you know, the, the pluses and the minuses. And if you, if you really move into a truly personalized, and to some extent, real time risk, it means that the individual needs to almost carry themselves, because you’d never know what the pool is going to look like. Because everything becomes a bunch more fluid and more real time as well. I’m not saying it’s impossible at all. I love the idea. Absolutely. I think it’s we’re still, unfortunately, a fair bit away from actually implementing this, because there’s so many, there’s so many camels that needs to be swallowed before we get that, right. So,

Michael Waitze
But let’s talk about because nicely enough, like you gave these three frameworks, right, the relevancy younger people, these digital platforms and ecosystems, and then you talked about data. I want to again, dig a little bit deeper there. How can insurance companies and InsurTechs for sure, and even companies like Dacadoo make recommendations or, you know, give advice around how to, in your words, right, just enhance the underwriting process enhance the whole process by harnessing the data that they get? And I guess the other question is, if you’re not a sort of data enhanced company, how do you handle the data engineering side of it first? Because without great data engineering, you can’t have great data analysis. Is that fair?

Thomas Dijohn
That for me, that’s that’s probably less of a concern, because I think there’s a lot of stuff, a lot of great data engineering available in the world today. And I think if you go 10 years back, and you look at everything an insurer needs to do through the value chain, you will find that maybe 95% of that was done in house, your insurance was very much self sufficient. Right. But there is, you know, there’s plenty of reports now, that shows an insurer is very much recognized that they can never, ever keep up on all these different, as I said before, the insurance needs to maybe decide on what’s my core strength, because trying to keep up with everything in the value chain, I think is almost impossible, right? And that means insurers they are, we see it a lot how they’re leveraging off external capabilities. So actually acquiring the, the engineering skills, for lack of better words, for me is that’s the easiest bit really because it’s available from death where the insurer face come in, they are offering these types of innovations and new ways of approaching things right. So it’s not so much the client and it’s more about having the culture and the courage to work an insurer takes an understanding how these organizations are working, that’s that’s definitely available. And will those comes the capabilities to use to model things to extract new values to do new combinations that you can derive all kinds of insights from that’s one part of it, access to then to the data was you run through the through these different engineered models is available everywhere. You know, that’s that’s the one of the easiest things as well, you can collect, as you know, through wearables and apps, every country or not every country, but more and more countries are digitizing electronic health records or population records, and medical devices, etc. So, for me, that’s actually one of the easiest bits.

Michael Waitze
Okay, but what are the opportunities that are there? In other words, if you think about all this stuff that’s getting digitalized? How does that help insurance companies make money in a different way?

Thomas Dijohn
So the, in a number of ways, so I think the, we talked about personalization, but one of the things is, most most people doesn’t know what the insurance policy is, most people does not understand insurance policy. And once they look at it, I think, okay, that’s lastly, but it’s, it’s somewhat relevant and somewhat irrelevant, right. And, if you have, if you have additional data, needless to say, you know, it’s, you can cause you know, they can cut the cake into smaller pieces, right. So you can you can, you can make the product more definitely more personal and with this data. One of the things we do, for instance, in Dacadoo, because we have a medical background originally is that we have been able to access a lot of public population studies covering all kinds of different health elements. And when you work through them, you will identify they are something like 100 different data points that in one way and another will affect the health outcome. Now, if you’ve got some smart medical people and good data scientist and some good coders, you can begin to take all these different data points and build some pretty sophisticated models, where you can look at if I have data point x, y, z but I don’t have a, b and c, I can use with the knowledge i have from my studies on how x, y, z is related to a, b, c, I can use x, y, z to impute the value a, b, c. And that means that once you begin to get access to some of these data points, you can really begin to take the additional data and create new database and medical science and have a huge data lake full of data. So coming back to your question, you can personalize the products to a much higher degree as well. In house you also must better understand your risk your insurance that they go out and and you know you want to have an insurance product, they look at our life table. The life table has very limited data points. We call it a low dimensional they will if they go and look at someone like you, Michael, who is 25 years old, plus. Look at you. Yeah, you’ve got let’s say you’ve got you’re gonna look at five male, five male, 50 years old, nonsmoker, risk table in saying in Thailand we’ll say others stay the same risk. In reality, those five people are living different lifestyles and are in reality five different risks, right? So for sure, it really allows it’s a much better understand what’s the true risk of the people I’m working with. And if I’m happy with where risk are heading, I can influence people’s behavior. If I’m unhappy, I can also influence through say goals and programs etc. The real key goal is probably if you have some form of engagement and you use that insight to change people’s behavior, you can in fact improve the quality of the book, the quality of the book means you will attract discount for the reinsurer, which ultimately may also lead to that you can release or release some of the reserves. Hello, then the shareholders get happier right

Michael Waitze
Yeah, they do, they get super happy.

Thomas Dijohn
There’s so many ways you can do use data, whether it is, you know, products or better understanding of offer of claims as well. I mean, I often say I work with a client, at some point, they said one of the big issues we have is that the agents if they talked to a customer on a savings product, I like to maybe upsell them to a protection product. They don’t know what questions was to ask. On this, the question is going to sound very odd. If you’re talking to someone about a savings product and begin to ask questions related to protection product, the agency does a very odd conversatio. With the kinds of data that insurance can collect now, you could provide agents, additional information about the customer. So when you meet them, you already have additional insights about their lifestyle, their behavior, you will be prepared, you can say, you know, I know you on this little engagement platform, and I can see you at this lifestyle, or you’re enjoying your walking or you’re enjoying your food, blah, blah, blah, by the way, based on the information you’ve given us, did you know we have x, y, z, so you’re really giving the agent far more ammunition to prepare for this as well. And that means you have lower cost lead generation you have a shorter sales cycle as well, right? So if you go back to the classical combined ratio, data can really support your both your top line, it can support expense ratio, it can support your claims ratio. Absolutely.

Michael Waitze
Is there also a way to use real time data to do this? And I’ll again I’ll tell you why from my perspective. We used to, we build technology when I was on sitting on a trading desk, or sales trading desk, we used to call it real time sales trading. So if we had a client on the phone, not only would we know their name and the company that they worked at, but we would actually be able to look at their entire portfolio of stocks that they held when they bought them what their returns were, and be able to make real time recommendations, even as the market was moving. And I know the insurance market doesn’t move like that. But your health is changing every day and the weather and all this kind of stuff. Is there a way to incorporate real time data into this process? And again, feed it to an agent through some sort of, you know, whether it’s a phone or an iPad or something like that, so that when they’re having that conversation, that they can have these richer or deeper conversations.

Thomas Dijohn
Technical yes. It comes down to it comes down to whether the individual have consented to the agents who get that information. Right. I mean, that that’s, that’s a contender. But your particular perspective? Absolutely. I mean, what what what you want to do is you want to look at, what was the data that’s on receiving right now? And where is the customer? And based on the data I have? Where might the customer end up? You know, what, what’s, what does the future look like for this customer here, and that might be giving you opportunities to upsell and cross sell. But you may also look at and say, okay, the customer is hitting this direction here, I spoken to my engagement, guys, if I could get them to maybe change a and b a part of their lifestyle, I can change the course of their of their life as well, you know, you, you can absolutely. You can use data and you can use your artificial intelligence modeling skills to learn from the past, to predict the future, but also to correct the future. Absolutely, you could do that. And we do that in real time. Absolutely. So you can see if someone is, is on a certain course on you can and you can adapt accordingly. I mean, in the real world in a dream world, and Shira would go real time pricing.

Michael Waitze
Yeah, I think so I actually think it’s going to happen, because like I said, I saw this happen in the in the trading market. And my view on this is that the insurance agent shouldn’t say to somebody, you know, and we never did this as a real time sales trader, either I know you hold, you know, 4% of your portfolio in Sony and Sony’s moving but what we could do, because we know that is instead of saying I know you just had a baby, or I know your daughter just turned three years old, just say, look, we know that as kids get older, here’s some real time data on what’s happening with all this kind of other stuff. You may consider buying a policy without being so explicit about I mean, sales to me, on any sort of distribution product is not about hard selling somebody, but it’s about having a conversation with them and letting them make the decision on their own or letting them feel like they’re making that decision.

Thomas Dijohn
Yeah, and this is where the engagement comes into the return a thing I’ve talked about before as well, I really think as part of the ongoing engagement, you can create that awareness and that context where it becomes natural for a customer to buy the product as opposed to be sold that right. Yeah. So So when your agent sees you the customer saying Okay, here we go, I’m going to be interrogated again and having a hot sale. But you might actually say, Okay, yeah, you know, I must been understand my in my life, my health where I am and when the insurance are talking about something, and he or she does that based on the data that you have provided, you’ve got that instant connection, that relevance as well becomes much more intuitive or logical for the person to buy something right, in an agent situation. So But yeah, I mean, I just like you take your bank account or stock quote, you know, you should be able to also look at your financial protection and make decisions accordingly. In real time.

Michael Waitze
I agree. And I think that that’s where things are going to go. And that’s why the title I think of this episode is going to be you live in real time. Look, I don’t want to take any more of your real time today. I really want to thank you for coming in and doing this Thomas Dijohn, Senior Vice President Asia Pacific at Dacadoo. We’ve got to have you back on the show.

Thomas Dijohn
Thank you very much. Really enjoyed it.

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