Saturday, September 23, 2023

Renova aims to unlock the untapped potential of the Latin American insurance sector

The Latin American insurance sector is currently facing its biggest challenge: exceptionally low insurance penetration, resulting in significant losses of potential revenue. This figure contrasts with countries such as the United Kingdom and the United States, which have penetration rates of 12.5% ​​and 11.8%, respectively, according to the State of Global Insurtech report. While 4 out of 10 Mexicans do not have health insurance, only 2.08% of the population choose private insurance. This significant protection gap represents over $250 billion in lost revnue opportunities for the insurance sector.

But this is not because of a digital divide. The digital prowess of the Latino population is reflected in statistics such as the impressive 97 million internet users in Mexico and an internet penetration rate of 74%, which is higher than the world average of 62%. However, the insurance sector has not been able to capitalize on this potential and, moreover, an important factor contributing to this problem is the general perception of insurance in Latin America.

Due to the complexity of insurance programs and the lack of direct communication with an insurer, many people do not understand the benefits of insurance programs and therefore are unaware of their value. Beyond policies, consumers seek understanding, ease of use and fluid interactions with insurers. And in the age of platforms like Rappi or Mercado Libre, these expectations lean heavily towards seamless digital experiences.

In order to counteract this, there is obviously a need for insurers to simplify their offers and educate the population. Insurers must prioritize demystifying the concept of insurance and illustrating its benefits in clear and understandable terms through user-friendly online digital solutions that help companies communicate and explain value to their customers more effectively.

“Online trends have not yet been reflected in the insurance market and this is where insurance providers need to start to reach the next generation of policyholders,” says Anastasiia Faizulenova, CEO and founder of Renova.

Despite the obvious need, insurers have a difficult path to digitalization because they cannot do it alone. Firstly, because they do not have the large budgets required for internal development and secondly because, according to a Deloitte study, the insurance sector is the least attractive for IT talent.

Currently, 88% of insurers say they intend to increase investment in public cloud services over the next one to three years, and more than half believe adopting these services will give them a competitive advantage. To save resources, companies choose a proven SaaS solution instead of an expensive IT team that could develop these products in-house.

The role of AI in the insurance sector

AI-based technology, with its ability to process large amounts of data, predict trends, automate claims and improve user experience, can help insurers close the perception gap. Simplifying processes such as converting complex insurance documents into understandable summaries can promote trust and clarity among customers. However, access to AI is not enough, it is crucial to integrate it into existing systems and processes. Transformation is not just about managing AI; It’s about integrating it into the core of the industry and making processes like filtering complicated policy documents very easy for customers.

In this scenario, Renova’s solution appears. Designed as a no-code platform, Renova provides insurers with the tools to quickly create digital experiences. The process is simple: upload insurance programs and customer lists and let customers interact through the app. All interactions converge in Renova’s helpdesk and are reflected in real-time metrics that capture the pulse of customer satisfaction. Taking AI integration one step further, Renova has developed an AI system to simplify complex policies. For example, Renova’s AI converts a dense 52-page insurance document into understandable, user-friendly text. This clarity ensures customers understand the nuances of their policies.

Renova’s solution provides policyholders with easy access to their simplified insurance programs while facilitating direct communication with providers.

“Only through a user-friendly approach can we attract the new generation of policyholders,” adds Faizulenova. It is the focus on user experience, coupled with the power of AI, that positions Renova as a benchmark for a technologically advanced insurance sector.

Digitalization is not just a trend, but a necessity. At a time when the industry is undergoing massive digital transformation, insurers that resist this change risk becoming obsolete. In fact, the insurance sector is expected to be the second most affected by AI, with 50% of its tasks having high potential for automation. Therefore, insurers must recognize and adapt to these online trends in order to survive in the new digital age.

While the insurance sector in Latin America is full of challenges, it also holds untapped potential and opportunities. With the strategic integration of AI-based solutions that simplify insurance processes and contribute to a deeper understanding of modern consumer expectations, the region is poised for a transformative journey. “In this context, platforms like Renova can act as catalysts and lead the sector towards a better and more digitalized future,” concludes Faizulenova.

World Nation News Desk
World Nation News Desk
World Nation News is a digital news portal website. Which provides important and latest breaking news updates to our audience in an effective and efficient ways, like world’s top stories, entertainment, sports, technology and much more news.
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