EP 139 – Aniruddha Sen – Kenko Health co-Founder – There Is Almost a $350BN Gap Waiting to Get Filled

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Michael Waitze worked in Global Finance for more than 20 years, employed by firms like Citigroup, Morgan Stanley and Goldman Sachs, primarily in Tokyo.  Michael lived and worked in Tokyo from February 1990 until December 2011.  Michael always maintained a particular focus on how technology could be used to make businesses more efficient and to drive P/L growth. Michael is a leader in the digital media space, building one of the biggest and fastest-growing podcast listener bases in the region.  His AsiaTechPodcast.com show has listeners in more than 130 countries and his company, Michael Waitze Media produces some of Asia’s most popular podcasts.

ISB graduate with 18+ years across hospitality and Insurance. Hobbyist chef, bathroom singer and lover of dogs, family and vacations.

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The Asia InsurTech Podcast spoke with Aniruddha Sen, a co founder at Kenko Health about health insurance penetration in India and how Kenko Health is planning to close the gap in the market. 

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. Today, I’m joined by Aniruddha Sen, a co-founder at Kenko Health, Aniruddha it’s great to have you on the show. My first question to you is this. Do you know that the name Kenko Health is redundant?

Aniruddha Sen  

I didn’t know it was redundant. But I do know it’s perhaps, you know, a repetition of the same word in two different words.

Michael Waitze  

Exactly. So Kenko is the Japanese word for health. So the name of the company is health health. Perfect. 

Aniruddha Sen  

Maybe we should have just stopped at Kenko.

Michael Waitze  

Yeah, Kenko would have been a great name. You know, I lived in Japan for 22 years. Yeah. That’s why I know that. Okay. Well, anyway, it’s great to have you on the show. Before we get into the real main part of the conversation. What do you think is the biggest trend in InsurTech in India? And I would say, by extension, the rest of the world or the rest of Asia, at least? Yeah.

Aniruddha Sen  

Firstly, thanks a lot, Michael. So in terms of the biggest InsurTech trend, I would say that it would be health insurance itself. So traditionally, India has had perhaps one of the lowest levels of penetration of health insurance in the whole world. Our healthcare expenditure, basis GDP is also one of the lowest in the world, given the size of the population that we have, given the fact that India’s per capita income has been rising, it should ideally have been higher. But in the last eight to 10 months, what COVID has been able to do in terms of sensitizing people, getting them more sensitive towards things like productivity loss, and general healthcare risk. Perhaps more has been done in those eight to 10 months, then it’s probably been done the last 25 years. And you know, it may not be a trend across Asia, because you have different kinds of healthcare systems in different parts of the world and India has its own unique system. So when 600 million people suddenly wake up to a consumer trend, then you know, that it’s it’s quite a big trend.

Michael Waitze  

Yeah, for sure, for sure. I want to talk about why do you think that the penetration of not just insurance, but healthcare, as a percentage of GDP has historically been so low and remains low, even with GDP per capita growth accelerating.

Aniruddha Sen  

So it’s a combination of multiple things. So firstly, qualitatively, India is a fairly young country, we have a demographic dividend, and that dividend cuts both ways. So average age of the Indian population would be somewhere around 26, 27. Which means that most people feel invincible at an age liken that.

Michael Waitze  

Yeah, I remember.

Aniruddha Sen  

Exactly. So the general outlook towards paying for something but you don’t see a return on investment from is, is perhaps and because you know, the Indian population is more savings oriented. So it perhaps doesn’t sit too well with the Indian psyche. So that’s one of the major reasons. And then there are some other secondary and tertiary reasons. So for example, unlike in the US, companies in India, aren’t mandatorily required to offer health insurance cover to their employees. Secondly, the the industrial makeup of the country is such that there’s still a large part of industry which is still fragmented, and not yet organized. So to bring them under organized systems like health care coverage for workers, etc. hasn’t really happened yet. And thirdly, there’s no uniform social security system like you have in every other country. So there are governmental schemes that run, but they are primarily aimed towards people living below a certain income level. And then right at the top of the socio economic pyramid, you’ve got people who can afford to pay for their own health care, or buy their own health insurance, or they’re covered by their companies. So you’ve got a whole bunch of people, mostly from middle income families, who have to fend for themselves. And when people are given the discretion to make a purchase that does not offer an upfront ROI, then they will perhaps choose something else, because money is scarce.

Michael Waitze  

Yeah, fair enough. I mean, if you told every 26 year old or 27 year old, at some point, you’re gonna die. Most of them, obviously can believe it, but they don’t think about it. And you’re right, it does feel when you’re 26 and 27, you feel invincible. You’re not worried about it. Like if I fall down and nothing’s gonna happen, I’m just gonna be fine. So selling them insurance gets harder, I guess. Yeah.

Aniruddha Sen  

Absolutely. And as health insurance professionals, at least, about seven, eight to 10 years back, we were climbing, it was an uphill task for us. So essentially, what we were doing was that we were trying to sell something to people who did not really need that product. And that always is an uphill task.

Michael Waitze  

Can you give us some background? On like your career in your life, just for context, we can understand like, have you been involved in the insurance industry your whole life.

Aniruddha Sen  

Sure, I’ll give you a perspective on my career. So I started working in some on something which is absolutely unrelated to insurance. So I started working in hotels. There’s a conglomerate in India called ITC, which also runs hotel chain. I started working with ITC in 2002. I worked with them for about eight or nine years. And then I went off to my MBA from the Indian School of Business. And when I was passing out, one of the companies that came to campus was a health insurance company, and I had absolutely no idea. I like what they have to say. Besides the fact that, you know, I wasn’t really qualified to become a consultant with McKinsey or something like that, which is what most people wanted to go after. So I joined an insurance company, it was it wasn’t by design to smaller default choice. And that’s where the journey started. So I have been working in health insurance, specifically in health insurance since 2010. So it’s been a very long time, almost 11, 12 years.

Michael Waitze  

I understand. I want to talk again, about the penetration, you know, if you do a little bit of research, you’ll see that overall in India, the GDP per capita is about $2,100 per person, I’m rounding up a little bit, yeah. In Bombay, it’s over $11,000 per person. So it’s like five times more than five times higher. And in Delhi, it’s kind of in the middle, like 7800 bucks per person, right? Does that also drive the penetration that in the places where the GDP per capita is highest, that it’s much easier to sell this product? And that there’s an inflection point in sort of wealth accumulation that says, Okay, now that I have this, I now need insurance?

Aniruddha Sen  

Um, so short answer is no. And I have my opinion about it, I’ll try and offer that. So what what I have found is that the penetration or let’s say, it’s easier to sell health insurance to people who have a certain level of education and awareness. And that comes perhaps that ranks top on my list, even above income levels. So we find that you know, in places like Bombay, etc, it’s no easier or more difficult to sell insurance, perhaps it’s a lot more easier to sell health insurance to people down south. And in my opinion, that has to do a lot with the levels of education and the awareness that that is. We also find that it’s easier to sell health insurance to consumers in the north in some places like Delhi, for example, even though Delhi has a lower PCI, then Bombay. And I would believe that has to do with the number of hospitals and hospital chains that are perhaps based there. So there’s a little bit of, you know, different reasons that play out. But I don’t think there’s a direct correlation between income level and penetration of insurance.

Michael Waitze  

Interesting. Do people argue with you about this.

Aniruddha Sen  

No one not many people have asked for my opinion, till now. But yeah, I mean, people have their own opinions qnd that’s that’s basically formed by their own experiences.

Michael Waitze  

Yeah. Fair enough.

Aniruddha Sen  

This is based on mine.

Michael Waitze  

Yeah, I mean, I was talking to the reason I asked is I was talking to a guy named Greg Krasnov. And he, he is building one of the first sort of Challenger and Neo banks in the Philippines. And he said to me, that exact thing, he was like, the only thing that’s going and actually, I think the guy from Go Digit Kamesh Goyal said the same thing to me as well. There’s the GDP per capita problem and as soon as that gets solved, everybody’s gonna want insurance. But the guy in the Philippines said to me, people want to have their wealth protected after they reach $3,500. And you know, approximately, in that, and that’s why I asked you, because I’m curious, you do this every day and your target market is kind of lower income people are. And again, like you said, People with less education, less awareness. So just curious how all those things tied together. But it’s an interesting perspective, right? Because you’re right. I may believe something. But just because I believe it doesn’t necessarily make it’s true. Right. I often say that like, there are things that I know that I know. Right? And there are some things that I think I know, and I think this, this falls into the category for me. I think I know that. But I’m not really sure. Yeah. So Fair enough, right? Talk to me about Kenko. Health, I love the name, as you know. And some of the other recently sort of founded InsurTechs in India that are going after this sort of less affluent market, I think it talks more about actually the Indian market as a whole as opposed to each individual company, right? Because people believe that there’s a necessity to address the sort of second and third, third tier cities, what’s the difference with kenko than some of the other ones?

Aniruddha Sen  

Sure. So you know, before I get into the heart of the problem, I want to offer you a little bit of a background on where this whole problem is coming from. So and we look at it from a slightly different lens. So the total amount of healthcare expense in the country, if you put together all sorts of expenses, across hospitals, and out of hospitals, and medicines and services, and all of that stuff, would be about $370 billion. Now, the total size of the insurance industry. And one could debate that number a little bit 10, 12 percentage points here and there. But it could be somewhere around eight to $9 billion. The delta between those two numbers is a massive, huge penetration gap. The other funny thing that happens in India and my co-founder and I, we figured this, because we’ve had the opportunity to work closely with other our colleagues and other markets when, especially when we were working for Cigna health insurance in India. So what we found is that there’s a funny thing happening in India, which is that insurance companies in India tend to generally cover the expenses only that are incurred inside a hospital. So if you go to a doctor, if you buy medincines, one wants to cover those costs. The multiple reasons why their interests are not really aligned toward that. But that doesn’t happen anywhere else. I mean, generally, you would say that, you know, whether it’s the government providing you Social Security, or your employer providing your health insurance, you’d expect whoever that entity is to cover as many expenses within the healthcare realm as possible. So the total size of the hospital expense piece in India out of that 370 billion, would be somewhere around 80 billion. And from an standard typical insurance perspective, the gap is not 370 minus eight, it’s 80 minus eight, right? So that’s the first thing that we can go out going after. For us. There’s almost a you know, a $350 billion gap that’s just waiting to get filled. And out of that $350 billion gap, $200 billion in our estimation is complete whitespace. It’s not covered at all. There are some people you know, trying to do different things like approaching it from the point of view of perhaps lending for healthcare emergencies. But we always treat healthcare expense coverage from an emergency point of view. Never from a day to day non emergency point of view. So that’s the premise from which Kenko began. So that’s the first point of difference that is there between us and perhaps on the other InsurTech. The other thing has to do with our pedigree and our capability and our own experience, that’s my co-founder and I. So he’s an actuary and I have spent quite some time on the distribution tech side and operation side. And both of us, you know, if you combine our skill sets together, you’ll find that perhaps we we have experience about 80 to 90% of all the function areas that are required to run an insurance company. So when we thought of making a change, or doing something differently, we approached it from the perspective that if we are to create an impact, perhaps a pedophile service, like maybe just solving a problem and distribution or solving a problem, and on the claims experience point of it, but that may not be enough. So there’s a whole bunch of things that we have to do differently. And it might tantamount to doing all the things that an insurance company would otherwise do. But there are some regulations that one has to adhere to. So we have to figure out a way of working with another insurance company. And we’ve been very fortunate to find a great partner in perhaps shaping all of those points on the agenda. So from product design, to pricing to the way claims are handled, as well as how we approach underwriting from a philosophical point of view. So we’ve done things differently in all of those five or six different areas. So it’s not just maybe, you know, two or three things done differently. But I would say about 50 to 55, different things, smaller things which have been put together. 

Michael Waitze  

That’s a lot of things.

Aniruddha Sen  

Yeah, absolutely. We took one and a half years to do our background work before we even started the company. Because we were certain of one thing that if one has to make a real impact in in a place like India, where the where infrastructure is still developing, then you need to make some radical changes. So yeah, and plus, you know, some of these things haven’t been touched for 60 or 70, odd years. So it’s high time that someone at least made an attempt to touch them and change them.

Michael Waitze  

Can we go back to this? Yeah, it’s a it’s a great point, can we go back to this gap for a second, I’m just looking at my notes you said out of that 370 billion that’s spent on healthcare. 80 billion is for hospitals, and I’ve got to presume a good chunk of that remaining 290 billion is some accumulation of outpatient care, things that are related to health with a don’t necessarily happen inside of a hospital. So insurance companies have traditionally said, I don’t know, I don’t really care kind of thing. Um, but that also means that people have not been underwriting health insurance that covers that. So you mentioned partnerships, and I presume you don’t have your own insurance license, even though your partner is an actuary, but where do you get your capacity from? And mostly, like convincing somebody that has that capacity in general, that would be a reinsurance company, to say, You’ve never covered this before. As a amtter of fact nobody in the country really covers it. But we think this is important, and we think it’s actually sustainable. Please work with us. So what was that process? Like? And does that make sense? Is that is that following the proper logic?

Aniruddha Sen  

It’s a great question. So it was a long process of about nine months, where we had to sit across the table. So we went through various stages of conversations, various levels of the organization, within the insurance company, and bring an insurance company and all of its executives down to the table, and agreeing with the fact that perhaps they need to do things differently, maybe allow us to, you know, guide them along, suggest a few things. And some of these things have never been tried before. So it was a very long, slow, arduous process on both sides. But having said that, you know, it’s not easy for someone like an actuary to agree to try something absolutely new. So it speaks volumes for our partners as well. To have put that trust and confidence in us. And also to have created almost like a sandbox kind of environment within the organization. There’s something totally new can be tried out at a, at a small scale. And if it works, you know, it could be the next new thing.

Michael Waitze  

Did you feel like you were because this is like the stuff with startups that nobody ever talks about, right? I presume you just didn’t go to one insurance company, spend reinsurance company, spend nine months with them, you know, buy them coffees and just chat and just go Okay, you’re done. I’m sure you went to like, 20 of them or some big number. And at some, you know, one night I’m sure you went home with your partner was like, we’re done. Got it. They said, Yes, they did. Right. They said, Yes, I heard Yes. You heard Yes, kind of thing. And then they called you the next day. We’re like, yeah, sorry, we decline. Like Did you have those experiences as well?

Aniruddha Sen  

Oh, yeah, absolutely. There’s so many when you when you when you when you feel like you know, you take three steps forward, and five steps back. It happens all the time. But thankfully, both my co-founder and I, we’ve, we’ve had the same kind of experience multiple times over in our professional lifes. So now we’ve developed a bit of a thick skin for some of these things. But yeah, it is it was it was quite, it was quite difficult. And it’s not. You know, as I said before, it’s not easy for an insurance company to turn around. So I’m sure they too had their own moments of trepidation when they had to question themselves.

Michael Waitze  

Yeah, I wasn’t making a value judgment about like, you’re better than them or they’re smarter than you. I was just like, whenever you’re in that process of trying to do something new, the other side probably said yes. meant Yes, expected Yes. And then just went, feels a little too risky to me, kind of thing. And then had to say no. And they hated saying no, as much as you heard hearing it as well. Yeah. But I’m curious about this, too. What was it like when they finally said yes. And it was Yes. Do you know what I mean?

Aniruddha Sen  

Um, so I mean, certainly, it was a moment of elation. But you know, it’s also a validation. Because both my co founder and I, it’s not that we hadn’t tried to do this in our professional lives. So we had made such attempts. 

Michael Waitze  

Inside the big companies, you’re like, Hey, we should do that thing.

Aniruddha Sen  

Absolutely. We have tried it, we Riba and fairly influential positions ourselves. But in fact, in in some of those scenarios, we came awfully close. And then moments like this happened. So, you know, we went back to the drawing board, we tried again. And then finally, one day, we said that, you know, this is not going to happen. Let’s, let’s have the freedom to try it with some other people. And in India, we you have about 26 or 27 general companies that could be wrong about the number by one or two. But that’s about that about And out of those companies about I, in my opinion, about six or seven of the privately run insurance companies to health insurance with any kind of seriousness. And I have been doing so for at least the last six or seven years. So you just have six or seven entities to speak to. It’s not 20. So we don’t have a huge choice of companies to have repeated conversations with. So every time someone said, No, we were getting rather nervous.

Michael Waitze  

Yeah. Because statistically, it’s like, one out of six is not good odds, right?

Aniruddha Sen  

Oh, yeah, absolutely. Until finally, someone did turn around and say, yes, we were quite grateful.

Michael Waitze  

So I as you know, I talk to a lot of insure techs and a lot of insurance companies. And I think one of the things that I’ve found is that nobody wants to be first either right? In the sense that the peers are watching each other. I’m presuming that after you make that first, and I’m gonna put it in quotes sale after you convince somebody for the first time to underwrite this stuff, that the rest of the market is watching and saying, Wait a second, this seems to be working. Maybe we should dip our toes into this water as well. Have you had that experience, too?

Aniruddha Sen  

It’s a little early for us, perhaps for others to look at this and say that, you know, let’s try this out. But yes, we have been now that we’ve been operating for six or seven months. I believe that you know, some people are getting to know about us. So we’ve had a couple of people reaching out with some initial thoughts around maybe they could try it out. But I’ll hold that thought because, you know, it’s like an onion as you keep peeling the layers, you go in layer by layer. You realize that it’s not as simple as what you thought before and you learn to let go of a whole lot of things. Right. So until the last, you know, the very core the onion is exposed, I’ll hold my thoughts. Yes.

Michael Waitze  

Fair enough. Talk to me about the Kenko score, like, what does this mean? And how does it get calculated? And why do people care?

Aniruddha Sen  

Okay, so this is something that my co founder, and I, we, we hold very close to our hearts. So and it’s, you know, with everything else that we do, there’s a background to this. The background is that in, in health insurance, each life needs to get underwritten in one way or the other, especially when you’re distributing to retail customers. So typically, the process of underwriting is that you ask a bunch of questions, try and figure out what that medical status, and then perhaps there’s a medical test involved. Now, all our lives, we saw that this entire thing was a completely manual. So there would be doctors qualified doctors who would sit on the phone and ask people questions, record their answers, and then pass a judgmental call on whether someone should be covered or not. Ideally, these things should be at at the very least based on heuristics. And then one can build machine learning algos around it to automate the whole process and you know, keep changing the logic as more and more data comes in. That’s how it should ideally work. But it doesn’t. Some of it is due to inertia, some of us it is due to the legacy systems. And then the balances is due to people just not having the exposure to improve on a process why mandated isn’t broke or anything. Now we had the luxury of not having any legacy. So we created a mechanism where we look at a huge number of factors. So we asked, we look at almost 45 different parameters. And then there are, you know, interaction variables between each of those variables. So you get combinations of things like you know, what happens when a person is 40 years old, and is overweight, and has a condition, and so on, so forth. So you come up with a huge number. And then we distilled the whole thing for process, we distilled the whole thing down to a normalized score, which ranges from zero to 1000. And it gives you a fairly accurate picture of where you stand. We’re now also adding a color of financial or network to it. Once you combine one’s health, and one’s financial health, you get a sort of an all round picture on a on a life. And you know what the future prospect of that life is. So essentially, the score is a reflection on of where you stand relative to what life stage in life you are, you are in. What your genetic makeup is or any kind of conditions that have been around the family. If there are any lifestyle based conditions that you’re already noticing, and so on, so forth. So it takes into account all of that and gives you a single window score, which tells you where you are at. It’s a simplistic kind of representation of something which is far more complex. And the whole process is automated, where perhaps the only people in the country to, to automate this completely from end to end. To give you an idea, we have the total number of doctors that we have an article underwriting process is zero.

Michael Waitze  

It’s a low number.

Aniruddha Sen  

The number of people that we have an operations in an operation traditionally, you know, insurance companies have huge operational back offices. The total number of people we have in operations is zero. So it has some peripheral benefits as well, of having, you know, taken the pains to put it all down to an objective reflection of your health in an automated seamless manner.

Michael Waitze  

That’s a pretty lean team. No doctors and no people in operations. Is the level of automation really that high that you can sustain scale with that type of staffing?

Aniruddha Sen  

So we get this and we get asked this question a lot. Now, from where we are coming from, we see that in our opinion, you don’t We were in any case being measured up against a really, really low base. So our opinion is that you don’t need to have people in operations to run operations. And we’ve seen these things fairly close and upfront. So to give you an example, and this is just a, again, that reflection of my own opinions. So in an insurance company, you have a process, and it’s called endorsement. So, if your phone number changes, and you want to tell your insurance company, hey, my phone number has changed. Everything remains the same, but just the last digit changes from five to four. That is treated as an endorsement. And there’ll be a minimum of four to five people involved in that process. Because when you signed up for insurance, there was a there was an indemnity contract that was late. And then making any changes to that indemnity contract has a huge repercussion, the whole system. We created these walled gardens, these processes for ourselves 50, 60 years ago, and we’re continuing to follow them. Even till today, most of my colleagues and insurance will turn around and say that, you know, it’s required, you cannot do away with it. We’ve taken a contrarian approach. We’ve done a whole lot of things differently, I’m not going to know what all changes we’ve made. But in our opinion, you don’t need an endorsement. When someone wants to change the phone number, it’s not such a big deal, just go change the phone number. And that’s it. In fact, do one better let them change, give them a web based interface or an app, let them change their phone number. It’s really not such a just verified possibly with an OTP, it takes less than 20 seconds. So that’s an example.

Michael Waitze  

Yeah, no, it’s a great example of, of automation. One of the other things that you’re doing is you let people make monthly payments for their insurance. How why, like, this is actually pretty personal for me, like, Why is it taking so long for insurance to get paid monthly, as opposed to annually? I mean, it’s part of the idea. Then you said this, too, right. There’s a there’s a health of your economic environment and a health of your physical environment as well, right? And maybe I can afford the insurance, but I can’t afford it all at once. Why can’t I just pay it over the whole year in pieces? Like, why is that been such a big problem?

Aniruddha Sen  

Sure. So like everything else that we’ve done does a background to this as well. You know, a lot of the stuff that we do in insurance has to do with inertia. Basically, you know, this is how we’ve done things for the last 2030 odd years. It works, there’s no reason why we need to change it, right. So insurance companies have a certain tech stack, which they pretty much buy off the shelf. Now, that tech stack has certain standard processes. And for services company that is selling that stack, they basically what they do is they amalgamate processes across all the customers, and then sell you a product which caters to as many customers as possible, which means you inherit a bunch of processes straight off the bat. So that’s how the system works. And having an annual contract is one such legacy. So the insurance contract as defined by the regulator is a 12 month contract. But still, there is nothing stopping you from taking a one month’s payment by issuing and issuing a 12 month contract, and then waiting for the next 11 payments to come in. I mean, there are so many other use cases where we don’t do that. It’s a so when when I was in insurance, the kind of question that will come back is that you know what, if someone doesn’t pay, then what happens to that contract and then there would be a whole number of complications around it. So what do we do with the unexpired premium? How do we account for it? It’s a contract that’s expiring early so how what how will the regulator think about it? If you don’t want to do something, and I’m sure you know, there’s so many different ways in which you could skirt the issue. The other thing is there’s always this trepidation, that person will claim and then they will go away without pay. Right CB approach it from from A few angles so many years back, a consumer goods company in India, what they did was they used to sell these bars of soap. A whole bunch of Indians cannot afford a bar of soap. It costs maybe 20 rupees, which is like maybe 30 cents, they can’t afford 40 cents. So instead, what these guys did was they put liquid version of the soap or shampoo in a sachet, and sold it for one rupee. So that’s 1/30 of the cost. What happened was two things. One, they lowered the entry barrier for a whole bunch of consumers who have been left out because of affordability issue. Second thing that happened is that they actually made more money. Because on a unit basis, they were charging more for that one rupee session. But people don’t realize, because the price is so small.

Michael Waitze  

So no one’s looking at the base unit cost, they’re just looking at what does it cost me to buy that thing?

Aniruddha Sen  

Correct. And this then came to be known as sachet pricing. So it was done by leavers. And a lot of industries have followed suit had that have done their own version of sachet pricing. This is our version of sachet pricing for insurance. So insurance costs, let’s say $300 for the whole year. Now, if you’re going to ask someone to pay $300, you get a certain section of customers, right? As opposed to us asking people for about $20. Now the moment we do that, we get a whole bunch of consumers into the gate, which were otherwise being left out. So you do a little bit of a trade off analysis. And you see that you’re better off in any case, because most people who take insurance don’t really leave. They need that protection, they’re mature enough to know that you need that protection. And you need to have some controls built in to screen out people who will potentially try to keep the system Yeah, that’s your competency as an underwriter and you should be able to do that. So that’s exactly how we went about it. 

Michael Waitze  

Fascinating. I love the way that there’s a backstory to everything you do. It’s really, because it just means you know what I mean that seriously, because it means you’re thoughtful, it’s not like you’re just implementing these things, because this is the way it should be. It’s being implemented. Because here’s the experience that we’ve not just we’ve haven’t that people have had over time. Here are some things that we can learn from other businesses that have been successful by doing the sachet pricings. A good example of that. And here are some rigidity is built into off the shelf systems that we don’t have to live with, because we have no legacy systems. And we always said that, if we could build it from scratch, which we can, we’re going to build it this way. And here we are building it that way. And kind of staying true to that. That vision of we want to make it easier, we want to make it more inclusive, we want to make it less expensive, maybe on a day to day basis. But even on a full unit cost basis. It can either be the same or even slightly more expensive, because it still gives access to people that didn’t have access to it before. Is that fair? Absolutely. I don’t know I’m running out of breath. Maybe just because I’m so excited about this. Um, okay. I mean, I think we can go on, but I want to ask you this one last thing. How does infrastructure, which is a big deal in a country like India, but also a country like Thailand, right? How does infrastructure impact health care delivery, the costs that are associated with it? And then the insurance policies, they get sold for it as well?

Aniruddha Sen  

Sure, yeah. So infrastructure has a direct cost associated with the price. You know, and here’s a little story. So about 10 years ago, when I was in Business School, someone was making a presentation to us, where they showed us a picture of a girl in Africa, she had a ring around a little finger. And then he zoomed in under the picture and showed us that the ring wasn’t really a ring. It was a very poor girl. And it was basically the bottle opening. I don’t know what to call it that we’ll talk about on a can of Coke. So the message was that Coke had reached a part of Africa that health care hadn’t. So that has always that picture has always stayed with me. And it sort of makes us think that you know, what is the role of infrastructure. Someone who is essentially selling sugared water has the ability to reach section of the population which needs healthcare far more acutely, but healthcare isn’t able to reach. How does that work? Till about eight or nine years back when the internet hadn’t really proliferated, insurance companies were like banks, building branches, brick and mortar stores across the country. And then they would staff those branches with people who would then recruit insurance agents, who would then go out and sell edge. That’s and that’s how the insurance space grew. Ever since the internet’s come about, things have been done a little differently. So and the thing is that India has this tendency to leapfrog cycles of mutation or progress. So we perhaps have leapfrogged a couple of cycles of infrastructure building and got straight to internet based infrastructure, especially in the last eight to 10 months. So what’s happening now is that a company like Amazon, is now able to reach about 99% of the zip codes in in a country like India, where roads also haven’t reached 99% of zip codes, zip codes haven’t reached 99% of the report.

Michael Waitze  

I’m just gonna leave that to you actually.

Aniruddha Sen  

And you know, it’s a very interesting way how those guys have done it, they use a totally different system of using landmarks and milestone. So addresses in India, especially as you go into the hinterland will be like, so and so house next to the banyan tree. That’s the address.

Michael Waitze  

Yeah. And when you say, this is not next to the banyan tree, hotel and resort. Next to the tree, the tree that is of the banyan species.

Aniruddha Sen  

Correct? Okay. And so they evolved the whole system of navigating themselves based on these landmarks, right? So thanks to these companies, there’s a section of the population living in tier two, tier three places were discovering us, not because of our branch presence, or a retail store presence, but because now they have a cell phone. And they have Google. And they simply do a search whenever they don’t, they need to look for health insurance. And they find us right there. So it’s also a matter of timing, because we came into the market when COVID hates a whole lot of people, we’re looking for health coverage. And we’re a digital only company. So the only way to find us on a cell phone. So yeah, so that’s how it happened. So what we lacked in physical infrastructure, I think the country’s making up more than adequately for it with digital infrastructure.

Michael Waitze  

Fascinating. Okay. I will let you go. This was really great. I’m so happy. I’m really happy that you did this conversation today. I’m going to do it again Aniruddha Sen, a co founder at Kenko Health. Thank you so much.

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