The impact of Digital Disruption on

Insurance where to from here?

Glenn Lottering
Senior Director, Oracle Insurance Solutions
Financial Services Global Business Unit

May 2016

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The following is intended to outline our general product direction. It is intended for
information purposes only, and may not be incorporated into any contract. It is not a
commitment to deliver any material, code, or functionality, and should not be relied upon
in making purchasing decisions. The development, release, and timing of any features or
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Oracle Insurance Momentum
Strong Investments in Core Products Resulting in Significant Market Momentum

2013
Major product Product Excellence
releases for insurance
core systems
Strong Commitment to
Dramatic growth in the Industry
2011 new customer
Completed full acquisition 100% Customer Success
2008 functionality for Multiple customer go-
Completed M&A Life policy admin lives
Established new Added Health Ins Reinvigorated partner
strategy and Focus on ecosystem with
direction for Oracle international specialized
Insurance markets certification programs

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$350m+
Investment in Insurance Industry
Products

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Top Boardroom Priorities
Readiness for Inorganic Growth
Efficiency in Post-merger Integration
Growth From Non-traditional Markets
Demand for Faster Innovation Cycles
Rapid Response to Non-traditional Competitors
Digital Transformation of the Business
Source: Inside The 2015 Boardroom Priorities, Constellation Research, December 2014

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2015 Oracle its affiliates. All rights
its affiliates. reserved.
All rights | |
reserved. 6
Digital Transformation

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What Will Happen in the Next 60 Seconds?
users send make receives users download
347,222 110,040 4,310 51,000
tweets calls unique visitors apps

I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I ----- I
1
minute

users like users upload users like users pin

4,166,667 300 hours 1,736,111 9,722
posts of new video photos images

Source: www.domo.com

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Pace of Change is Accelerating
Number of years to 50 million users

62 years

28 years

12 years

2 years

Source: Brett King, Bank 3.0

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73% of executives say they already
have a digital strategy

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19% feel they have the right
technology

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14% feel they have the process to
execute their digital strategy

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 (Digital Transformation) the use of digital technology
to radically improve the performance and reach of an
organization.

SOCIAL MOBILE ANALYTICS CLOUD

Source: Leading Digital Transformation, George Westerman & Didier Bonnet, 2014

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Business Impact Of Digital Disruption Today

6
50 Years

800,000+
Properties

550+ 50x+
Valuation, as a
2.2x multiple of revenue

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In The Last 4 Months, 253 Fintech Companies Have
Attracted A Total Of $4.8B In Funding
Oct 2014 Jan 2015

#60

#75
#56
#62

Source: Finovate

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Digital Disruption In Insurance
Core Disruptive Innovations
Autonomous Vehicles Changing
Disruptive Business Models Consumer
BoughtByMany, Friendsurance
Expectations
New Digital Entrants
Alibaba, Google

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The Millennials Are The New Customer!

Of the
global
1980
Born after 30% Of the world
population 60% workforce
by 2025

Have enough
money or

27% Of Adults
in Europe 2T$+ Aggregate
net worth 85%
Sources: E&Y, Wealth Front, PewResearch, World Bank
expect to in
the future

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Three Core Life Insurance Consumer Challenges
The Geek Trap The Too Much Love Trap The Drifting Apart Trap
A high proportion of Many consumers are The customers contact
consumers do not turned off by the hard sell with his or her insurers
purchase enough life of the traditional face to can quickly reduce to a
insurance because they face sales channels once a year statement,
perceive it as overly the business equivalent of
complex and difficult to a round robin Christmas
understand Card

Source: KMPG Report How well is the Life Insurance industry keeping pace with changing technology, June 2014

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Differing Level of Expectations with Millennials
Empower
Me
WOW
Know Me
Me

.. Requires Carriers to
Think Differently!
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Market Drivers

Drivers of a
Digital
Strategy
Carriers view.

Source E&Y Insurance In A Digital World

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ROBO ADVICE
Robo-advisors typically provide guided advice and services to Mass Affluent and below, from a restricted product set, it
fits in with the Bancassurance distribution model it is subject to increasing levels of regulation..e.g. TCF or Treating
Customers Fairly

CURRENT
Financial Product EMERGING
Product Pitch
Transactional Process Financial Advice
Commissions Consultative Approach
Lifetime Value
Advisory Fees

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Phases of Digital Transformation in Insurance

1. Digital Presence
2. Digital & Mobile Commerce
Establishing a Web
presence 3. Digital Company
Transacting over the
Marketing & Brand Web New brand focused on
Focus Digital distribution pure digital products
Mostly one-way Adding mobile Product simplification
interaction capabilities & Robo-Products
Organizational & Tech
transformation

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Capabilities for Digital Insurance Transformation
Digital Distribution Cloud
Communication Empowering agents and brokers
with digital tools that drive ease of
Providing key stakeholders access business
Big Data Analytics
to information via any device at any
time
Leveraging data outside of
company boundaries to augment
the internal data for better insights
Flexible Core Connected
Core systems that foster product Collaboration
innovation and speed to market
Connecting external stakeholders in
real time to achieve full straight
through processing

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Layered Model for Digital Insurance
Distribution Cloud

Digital
Communication

Big Data Analytics

Connected
Collaboration

Flexible Core

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Composite Solution Set
Logical diagram to depict main products utilized for composite approach for Composite Insurer and/or Bancassurer
Group and Individual Acquisition Model

Meets demands of digital

disruption
Faster time to market for products
and flexible product design
Complete, pre-built, modular and
enables progressive renovation, yet
fast deployment
Fast ROI as pricing based on size of
business to ensure feasible
business case
TCO reduced dramatically due to
low cost of IT management over
time

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Comprehensive Bancassurance Platform
A case study

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Key Opportunities to Consider Cloud

X X
Multi-System/Cloud New Project Pilots Connected Infrastructure On-Premise Upgrade
Rationalization Collaboration Investment Avoidance
Avoidance

Global Expansion Shared Service Acquisitions & Subsidiary New Market Entry
Initiative Divestitures Strategy

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Bancassurance Cloud Vision
Digital CCM
Agent Collaboration Cloud Delivery
Big Data
Digitalization Customer Experience Social Media
Empower Insurance Carriers and Banks to Transact 100% LifestyleDigitally
Devices for Full
Agent Portal Mobility eApps
Straight through Processing
Data as a Service Data Science Advanced Analytics
Digital Marketing
Mashups

Bancassurance
Cloud

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Bancassurance Platform
Core Components

Core Bancassurance Carrier / Bank Bank / Agent

Platform Interfacing Front End
Flexible and adaptable Connecting banks with Empowering bank sales
core foundation for bank insurance carriers in real teams with digital tools
originated insurance time for insurance for financial needs
policy recordkeeping, lifecycle transactions to analysis, quotes,
commission calculations, achieve full straight illustrations, electronic
& reporting through processing application, & policy
delivery.

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Bancassurance Platform
Core Bancassurance Platform

Multi-line Multi-Carrier Product Support

Single platform for Life, Health and GI products
Support for multiple carrier products in a single platform

Bank / Agent Flexible Support for Bancassurance

Front End
Options to illustrate are not based on carrier contracts
Support for commissions & reconciliation
Core
Carrier / Bank Flexible business rules allow for configuration of custom transactions
Bancassurance
Interfacing
Platform
Lower Operational Costs
Drive process automation to reduce manual intervention
Designed for high-performance and high-availability

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Bancassurance Product Mix

160+
Products sold by a large
Asian bank under a
Bancassurance
arrangement

Source: CIFP Knowledge series, convergence of banking & insurance

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Oracle Insurance Bancassurance Platform
Carrier / Bank Interfacing

Bancassurance Gateway
A multi-tenant, on-demand B2B data exchange allowing
secure, real-time insurance policy data to be exchanged
between individual life and annuity insurance carriers,
Bank / Agent distribution channels and service providers
Front End

Standardization on ACORD Transaction Model

Core
Bancassurance Carrier / Bank Data as a Service (DaaS)
Interfacing
Platform Provides aggregated data for banks & carriers across multi-
carrier, multi-bank, multi-product relationship

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Bancassurance Platform
Bank / Agent Front End

Bancassurance RM Portal
Next generation agent facing tools to transact with the
carriers electronically
Bank / Agent Modern, Easy-to-Use Tools on the Cloud
Front End
Dynamic and Responsive Sales Illustrations for
Core
Any Device
Bancassurance Carrier / Bank
Platform Interfacing
eSubmission & Secure Document Delivery

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 Oracle Bancassurance Platform
The Blue Print
Bancassurance Front-end Tools
Cloud-based Access
Need Analysis
Illustrations
Quotes / Proposals
eApplication / Submission

Core Bancassurance Platform Insurance Company

Insurance Company
Policy Repository & Calculation Insurance Company
Engine for Banks Bancassurance New Business & UW
NewIssuance
Business & UW
Standardized and ISP specific Product Definition Policy
Quote, Application & Policy Data Persistence Gateway New Business & UW
Policy Issuance
Administration
Commissions Management Policy Issuance
Administration
Reporting & MIS
Billing & Claims
Administration
Benefit Illustration Computation
Billing & Claims
Multi-Provider Management Secure Data Exchange Billing & Claims
Reconciliations between the Bank and
Bundled Products the Insurance companies
Transaction Management
Statements

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The Next Generation Bancassurance Platform

SPEED TO MARKET POLICY RECORD BUSINESS INTELLIGENCE

REAL TIME EXCHANGE FULL AUDITABILITY COMMISSION RECON. DIGITAL EXPERIENCE

ENTERPRISE SCALE INDIVIDUAL COMPONENTS

Copyright
Copyright2014,
2015,Oracle
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and/oritsitsaffiliates.
affiliates.All
Allrights
rightsreserved.
reserved.| 39
Modern Insurer.
Modern Cloud.
Glenn Lottering (glenn.lottering@oracle.com)
Senior Director, Oracle Insurance Solutions
Financial Services Global Business Unit

Copyright 2015 Oracle and/or its affiliates. All rights reserved.

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