Former AXA Partners head of innovation reflects on potential technological changes in insurance industry

Three years ago in September 2016 when he first started his role at AXA Partners as head of innovation UK and Ireland, Milan Sud told Insurance Times he was given a blank sheet of paper saying, “make us more innovative”. 

He was equally excited and daunted by the challenge of the role he held for three years, but in August left to pursue something completely different. 

It is not known whether a successor will be appointed. 

AXA Group had initially launched AXA Partners as its global partnership arm just a year before Sud started there with the intention of tapping into business collaboration opportunities around the world. 

Sud’s previous role as open innovation project delivery manager at Barclays saw him responsible for fintechs within the bank’s accelerator, paving the way for what was to come as did his longstanding relationship with Barclays.  

Earlier this year AXA Partners revealed its plans for becoming a service provider for a range of sectors such as smart connected home, automotive, utilities and telecoms – and Sud was responsible for driving this strategy.

Its key focus areas include driving revenue, cutting costs and improving customer experiences. 

Sud looked at disruptive innovation which means launching new products and services as well as helping AXA or its clients infiltrate new markets incuding automotive, banks and credit cards, retailers, utilities, telecoms and non-government organisations.  

Shifting expectations 

But expectations in insurance are changing, Sud said that customers’ experiences elsewhere such as with Uber is driving this. 

“Technology is driving everything we do in our day-to-day lives and why should insurance be any different to that? If you look at the funding that is being pumped into insurtech at the minute, it doubled in 2018 from 2017 hitting about $3bn.

”Innovators are recognising that they can leverage technology to drive improvements in the industry. I think it’s been a bit of a wake-up call to the industry, there’s been a bit of a comfort blanket around insurance as a necessity product,” he explained.  

He gave the example of buying a new car and the insurance being compulsory for driving it. 

Delighting the customer 

AXA Partners was previously looking at how it leverages insurtech to change the dynamic that currently exists around brand loyalty with aggregators making it “easier than ever to switch insurers”. 

“But I think the rise of insurtech means that insurers are starting to wake up to opportunities to delight the customer as opposed to what has traditionally been a grudge purchase.”

He pointed out that customers who claim being more likely to stay with their insurer as there is an interaction there and if it is a positive one, this would increase retention. 

Mobile first  

He said that processing claims online has derived from the drive for “mobile first”.  

In the past customers would claim over the phone but he says that with consumers now becoming more and more time poor, and technology infiltrating people’s lives that interacting with insurers via telephone is not always suitable. AXA digitised its home and motor claims experiences.  

But Sud said that there is still more to be done, he referenced the firm’s research which cited that 45% of brokers have a mobile capability against a market whereby 87% of retail purchases were made online, so there is a discrepancy there with organisations that have digital capability versus those that don’t. 

“Slightly more concerning is [that] less than 20% had self-service,” he said, this is because it is inefficient for the insurer and customer. 

Death of the broker? 

When asked if the broker might be cut out of the value chain , Sud said: “Actually, I think that brokers have got a fundamental role to play, [but] what they need to start focusing on is how do they drive value beyond the insurance contract. They have a stronger role to play as opposed to incumbent insurers who may only be looking at their own product set.” 

Drawing parallels  

Sud thought back to when he started out in banking, the message at the time was that fintechs were out to disrupt, steal customers and that the bank was dead.  

“[But what happened was] fintechs recognised that banking incumbents had a lot to offer them and vice versa. If we look at the assets an incumbent insurer or broker has for example – they have distribution potential, they have brand, they often have large financial pools that they can dip into as well as world class capability,” he explained. 

Similar to insurtechs however, which can move at pace, they have access to technology and capability. 

Future of mobility trends

Lastly, Sud said that technology is influencing the future of mobility in a fundamental way which are far greater than getting from A to B, these include environmental consciousness, sharing economy, legislation around electric vehicles and advances in technology like autonomous driving. 

“I think we are seeing a continued rise in the sharing economy [as opposed to owned] and the democratisation of that [shared] ownership will be one key trend. There will be a rise in mobility as a service – [with] aggregated mobility as a service trend.” 

Sud predicted a rise in intermodal journey planning which allows access to different car sharing forms at the touch of a button that operates in real-time through a single portal. He envisioned something like an Apple Pay whereby users can buy a service bundle in advance. 

“By 2035 the autonomous vehicle market in the UK could be worth £50bn, and we are going to see self-driving cars on UK roads by 2021,” he added. He questioned whether people born around that time would ever need to learn to drive,” he added. 

He also foresees a rise in autonomous and green travel with the public becoming increasingly more energy conscious.