Qoala Positions itself as an Insurtech Platform for the Retail Segment

The digitization of the insurance industry is not just about changing sales channels to digital channels. Its efforts to change the entire business process end-to-end, from product creation, marketing, purchasing, to claims. Collaboration between insurance companies and platforms insurtech ultimately become an important key in increasing the penetration of insurance which is still minimal in Indonesia.

Qoala realizes that this strategy must be carried out in a modern way, namely placing insurance as part of daily life so that people can recognize the basic benefits of insurance. So far, the insurance industry is still quite traditional, relying on agents with products being marketed that have high value, can not be sold cheaply.

“But with digital channels, we can't be that easy convert from traditional to digital because channel Digital must be different. It must be in accordance with the activities of the people who buy through the platform, which is affordable, easy to understand, and because the purpose is education, it must be easier when claiming, "explained Qoala COO Tommy Martin in a joint interview. DailySocial.id.

In the course of formulating micro-insurance products, Qoala and insurance companies work closely with each other with their respective expertise so that the product can be right on target. Tommy gave an example, travel insurance products will get more value if it is associated with their habits when accessing OTA applications that they always visit.

For example, when buying plane tickets in this pandemic era, there is a risk of delay/cancellation/rescheduling of flights and risk protection if you suddenly test positive for Covid-19. The risks that arise can provide urgency for consumers to buy it. This advantage previously could not be provided by insurance companies because they had limitations in obtaining data analysis of consumers' digital habits as the most important provision.

This expertise is Qoala's strength and combines it with capability underwriting owned by insurance companies as risk management. Underwriting In simple terms, it is the process of risk identification and selection. When applying for insurance, the prospective insured will first go through a process underwriting before finally they are charged a premium of a certain amount.

Apart from that, they do not have the capability to build an understanding of digital-based societal behavior and understand what risks they face in the current era. This talks about data that not all of it can be accessed by insurance companies.

Service presence required insurtech to access and analyze data, for example flight delay data obtained from Angkasa Pura for travel insurance. Millions of data are then processed by the platform insurtech to get input and detect flight delays real-time during the claim process.

For insurance companies, claims submitted for flight delays range from IDR 150 thousand to IDR 500 thousand. This is a small number, but to form a special claims team, this product requires quite a bit of investment, because the digital world talks about quantity so that it doesn't become an issue if the claims received reach thousands.

“What we are developing is cooperation for flight status [with Angkasa Pura], so we can detect delays. So consumers don't need to claim, Qoala can even provide notification of the right to claim so they can just submit a claim easily. "The hope is that in the future they can understand insurance in an easy way."

Every time there is an innovation that changes people's behavior, it creates new risks. This is an opportunity that insurance companies can exploit, so that their products are also required to continue to innovate. The world of insurance itself is known as a rigid industry with work processes that are not as dynamic as services insurtech.

In a year, the volume of policies processed may be tens of thousands because the products sold are expensive because they rely on agent marketing channels which are expensive. Meanwhile, if you go through digital policy channels, millions can be processed because the products sold are micro.

“Insurance has to be lifestyle which is not sought for one year, but can be purchased several times a year. That's why it has to be linked to lifestyle. "

Qoala business trip

Since operating in 2018, Qoala has positioned itself as a platform insurtech for retail with two products, namely Qoala Plus (agency) and Qoala for Enterprise (B2B and B2B2C). The approach is more or less the same as what was done PasarPolis, its closest competitor.

Qoala Plus is a platform for insurance marketers to make their work processes more efficient and digitalized. They are also more independent in providing a wider range of product options, because they are not tied to just one insurance company.

“We have collaborated with 30 companies. Marketers can market all insurance products via the application. "The advantages have been communicated so that they can provide better solutions and better service."

Meanwhile, Qoala for Enterprise offers solutions for businesses in various industries, both for internal and corporate purposes growth avenue and sources of increased satisfaction end customer or profitability. More than 60 technology companies from local and abroad have collaborated with Qoala to market innovative insurance products.

“One day people who are educated through Qoala for Enterprise will realize that flight delays will not change their lives. "Finally, they realized that the most important thing about insurance is life, accident, health, vehicle and property insurance which could have a financial impact on someone if this happened."

This connection between Qoala Plus and Qoala for Enterprise speaks to the company's strategy in increasing insurance penetration. The digital innovations carried out are different but have the same intersection. Qoala Plus focuses on digitizing marketer services. Traditional insurance products are currently good and well regulated, but need to be improved in terms of services such as issuing policies and faster claims processes.

Meanwhile, Qoala for Enterprise focuses on education. Thus the product must be micro, policy issuance and claims must be instant and automatic. Therefore, digital innovation needs to be carried out comprehensively, because product development depends on the availability of data and community needs which must be linked to popular digital platforms.

Qoala business expansion

According to the experience Qoala has gained from neighboring countries, traditional insurance products still need marketing through marketing channels. This is due to its complexity, so it is still more comfortable to explain the product through marketers. This custom is similar to pawnshopping. In fact, even in developed countries, with high insurance penetration, they still need the presence of marketers.

In Thailand, one of the countries Qoala has penetrated thanks to acquisitions  towards FairDee, the company has run an agency business model since it first operated in 2019 and has proven capable of being a leading player with more than 10 thousand marketers. The FairDee concept was replicated and brought to Indonesia.

The marketers who join Qoala Plus are called Mitra Qoala Plus, it is claimed that the number reaches more than 50 thousand people spread across Batam, Medan, Lampung, Jakarta, Bandung, Samarinda and Manado.

Although Tommy was not willing to provide details, Qoala's biggest business contribution came from Qoala Plus with ticket sizes premiums start from IDR 3 million to IDR 4 million with thousands of policies sold. Meanwhile, Qoala for Enterprise is a more micro product ticket sizes starting from IDR 5 thousand to IDR 10 thousand with millions of policies sold. "While the group is growing, premiums have grown five times from last year."

Qoala can be said to be a platform insurtech local with the most regional expansion. Currently the company has operations in Thailand, Vietnam and Malaysia. Except in Thailand, Qoala built its business from scratch in each country. Thailand's contribution to group revenue is said to be quite dominant after Indonesia, with its marketer model.

Meanwhile in Vietnam and Malaysia, the company is running the Qoala for Enterprise solution and started operating last year. "Because at Enterprise, cooperation is built with companies from Indonesia that have business in both countries. One of them is Traveloka too."

Qoala has learned a lot from neighboring countries to help develop the insurance business in Indonesia. In Thailand and Malaysia, for example, the level of public awareness about insurance is high because it is mandatory for every motor vehicle owner. There the regulations state that vehicle insurance must be included for every STNK renewal every year.

“There are more regulators know more, from risk management, better infrastructure. In Indonesia, potential is the advantage market largest by number of digital platforms, ranked 5th in the world by number of startups. There are many lessons learned from more advanced insurance companies to be adopted in Indonesia."

The company targets that throughout this year its overall business can grow up to five times compared to the previous year. It is hoped that the proposition brought by the company can catapult its position as a platform insurtech for the largest retailer in the region. The retail products in question are vehicle, travel, gadget, health, life and property insurance.

“That's enough [country expansion], because of all that market which we propagate market potential. The next plan remains focused on Indonesia. Developing technology and innovation, especially Qoala Plus."

Another plan that Qoala has accelerated is to apply as an insurance company. Tommy said that this plan would most likely be explored a maximum of two years from now. This trend is naturally a concern for players insurtech in any part of the world because of ability underwriting which can only be done if it is under the banner of an insurance company.

Not only that, this license also gives them more control over their products and core operations, as well as greater exposure to underwriting profits. However, because insurance is a highly regulated and capital-intensive industry, becoming a licensed insurance company will force startups insurtech to reallocate resources and capital away from growth initiatives.

This condition is not much different from recent trends, such as companies lending or fintech which acquired banking to become a digital service. On the global stage, a number of companies insurtech has now become a full-fledged insurance company, including Bestow, Hippo, Pie Insurance, Lemonade, Metromile, and Root.

“In Indonesia, the variety of insurance companies is very important because the insurance business is large. This doesn't mean that if we become an insurance company, we won't collaborate with existing companies. "Cooperation must continue because it serves the wider community," he concluded.