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Technology in Microinsurance How New Developments Affect the Work of Actuaries

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Technology in Microinsurance How New Developments Affect the Work of Actuaries Innovation and Technology Technology In Microinsurance How New Developments Affect the Work of Actuaries May 2019 i Technology In Microinsurance How New Developments Affect the Work of Actuaries Queenie Chow, AIAA MicroInsurance Centre at Milliman Jia Min Ng, FSA, PhD Independent consultant Katie Biese, ALMI MicroInsurance Centre at Milliman Michael J. McCord MicroInsurance Centre at Milliman Caveats and Disclaimers The opinions expressed and conclusions reached by the authors are their own and do not represent any official position or opinion of the Society of Actuaries or its members. The Society of Actuaries makes no representation or warranty to the accuracy of the information Copyright © 2019 by the Society of Actuaries. All rights reserved. Copyright © 2019 Society of Actuaries ii CONTENTS Acronyms ................................................................................................................................................................ iv Executive Summary ................................................................................................................................................. vi 1. Introduction .......................................................................................................................................................... 1 1.1 Research objective ................................................................................................................................................... 1 1.2 Methodology ............................................................................................................................................................ 1 1.3 Background – Microinsurance and technology...................................................................................................... 2 1.4 Structure of the literature review ........................................................................................................................... 3 2. Literature Review .................................................................................................................................................. 7 2.0 General resources relating to technology and microinsurance ............................................................................ 7 2.1 Rating ........................................................................................................................................................................ 9 2.1.1 Big Data and Machine-learning ............................................................................................................... 9 2.1.2 Remote-sensing technology, including satellites ................................................................................. 12 2.1.3 Pricing tools ............................................................................................................................................ 20 2.1.4 Other rating-related resources.............................................................................................................. 22 2.1.5 Lessons learned – rating ........................................................................................................................ 23 2.2 Distribution ............................................................................................................................................................ 24 2.2.1 Mobile networks .................................................................................................................................... 24 2.2.2 M-health (Focus on Telemedicine) ....................................................................................................... 28 2.2.3 Digital marketing channels .................................................................................................................... 30 2.2.4 Artificial intelligence and chatbots ........................................................................................................ 32 2.2.5 Agent-led mobile insurance platform ................................................................................................... 33 2.2.6 Lessons Learned – distribution .............................................................................................................. 34 2.3 Claims adjudication ................................................................................................................................................ 35 2.3.1 Claims administrative systems .............................................................................................................. 36 2.3.2 Smartphone applications ....................................................................................................................... 40 2.3.3 Remote-sensing / satellite technology ................................................................................................. 45 2.3.4 Internet of Things (IoT) .......................................................................................................................... 47 2.3.5 Blockchain ............................................................................................................................................... 51 2.3.6 Machine-learning / data mining ............................................................................................................ 53 2.3.7 Lessons learned – claims adjudication .................................................................................................. 56 2.4 Payment facilitation ............................................................................................................................................... 58 2.4.1 Mobile money ........................................................................................................................................ 58 2.4.2 Airtime .................................................................................................................................................... 61 2.4.3 Other payment-related resources ........................................................................................................ 64 2.4.4 Lessons learned – payment facilitation ................................................................................................ 65 3. Conclusions ......................................................................................................................................................... 66 Appendix A: List of Key Interviewees ...................................................................................................................... 69 Appendix B: Index Insurance ................................................................................................................................... 70 About The Society of Actuaries ............................................................................................................................... 71 Copyright © 2019 Society of Actuaries iii Tables Table 1. List of resources on technology and microinsurance, by resource type and line of business ................................. 4 Table 2. Resources on big data / machine-learning for rating purposes............................................................................... 10 Table 3. Types of satellite data and their application ............................................................................................................. 13 Table 4. Resources on remote-sensing technology, including satellites, for rating purposes ............................................. 14 Table 5. Resources on pricing tools ......................................................................................................................................... 21 Table 6. Resources on mobile network operators .................................................................................................................. 26 Table 7. Resources on m-health (focus on telemedicine) ...................................................................................................... 29 Table 8. Resources on digital marketing channels ................................................................................................................. 31 Table 9. Resources on artificial intelligence and chatbots ..................................................................................................... 32 Table 10. Resources on agent-led mobile insurance .............................................................................................................. 34 Table 11. Resources on claims administrative systems.......................................................................................................... 37 Table 12. Resources for smartphone applications ................................................................................................................. 42 Table 13. Applications of satellite data for claims processing ............................................................................................... 45 Table 14. Resources on remote-sensing and satellite technology for claims adjudication ................................................. 46 Table 15. Resources for Internet of Things ............................................................................................................................. 49 Table 16. Resources on blockchain ........................................................................................................................................
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