Is Internet Insurance an Opportunity or a Trap?

The past two years have been two years of sudden changes in the financial industry. 20 13, Yu' ebao brought history into the era of internet finance; In the same year, P2P also brought history into the Internet credit era; Then, Internet securities, Internet credit investigation, Internet financial management, etc. Various "internet plus" models are blooming everywhere ... But in such a small era of sudden changes, insurance, as one of the important pillars of the financial industry, has been tepid. Can you blow all kinds of pigs online, but you can't blow the hard stone of insurance?

First, the four chronic diseases of the insurance industry in China

Before talking about Internet insurance in China, we have to analyze the current situation of insurance industry in China. After two rounds of product innovation and channel innovation in the past 15, the extensive growth of China's insurance industry (property insurance and life insurance) began to moderate. Looking back at this point in time objectively, it is impolite to say that China's insurance industry still faces four chronic diseases.

1. Insurance awareness is still relatively weak.

I estimate that people who are reading this article in China should be well educated, but ask yourself and people around you how many people bought insurance products in China on their own initiative? If so, how much is it? Compared with mature countries such as Europe, America and Japan, even today, China people's insurance knowledge and awareness are still relatively preliminary and far from mature.

Take the depth of life insurance as an example (the proportion of total life insurance premiums to GDP). The depth of life insurance in Chinese mainland is less than 2%, while in Hongkong it is 1 1%, in Taiwan Province province it is 15%, and even in India it is 3%. In addition, from the perspective of per capita insurance policies, compared with Europe and America, China's per capita insurance policies are insufficient 1. Although people's insurance awareness has become more and more intense in recent years, on the whole, people in China still have a passive push rather than an active pull. Weak consciousness is the deepest chronic disease in the whole industry at present.

2. The channel is too strong

* * What is a channel? Channel is the way of sales, please note that this is "selling" rather than "buying". If consumers have the initiative to buy, channel fees will eventually be squeezed or subverted; But for the "selling" business, it will become "the channel is king". Unfortunately, insurance belongs to the latter. "Scene" is the most appropriate word borrowed from the Internet to describe the insurance channel.

Due to the existence of chronic diseases 1, China people must be passive in buying insurance, which means that buying insurance must be accompanied by specific scenarios: only when they see illness and death in the hospital will they have the idea of buying life insurance and health insurance; Only when you see the bad news of the flight crash at the airport will you have the idea of buying aviation accident insurance; Only when you expect Taobao to deliver goods will you have the idea of buying return insurance. Scenario theory leads to the strength of channel cost in premium cost.

Take aviation accident insurance as an example. More than 90% of the aviation insurance you bought at the airport or Ctrip is the channel fee. At the same time, in order to sell insurance products, insurance companies have to hire 2.5 million agents to run around and sell products seriously, and these expenses are finally spread to the premium. Even with the development of insurance companies today, the strength of channels makes the organizational structure built around channels more difficult for traditional insurance companies to subvert channels.

But this is actually a paradox that the insurance industry has been helpless. You don't have to buy expensive aviation insurance at the airport, but who would think of buying aviation insurance when you are not at the airport? In recent days, many internet insurance startups have put forward the slogan of subverting insurance and subverting the black-hearted channel of insurance. In principle, this is in line with the spirit of the Internet and is also telling the truth; But the insurance company here is also half wronged, because it is not entirely the fault of the insurance company. In fact, there is an interesting inference here. When these internet insurance companies really monopolize traffic, will they become channels themselves? This is like a tourist portal that just started in the early years. Cheap insurance seems to be a kind of customer acquisition and value-added service, but if it really becomes Ctrip and where to go one day, will this channel make money?

3. The product homogeneity is serious

Note that the word "serious homogeneity" is used here, not the lack of products. In fact, the insurance industry in China has never lacked the types of insurance products (even many strange types of insurance can be used, and all of them were invented by China, and the CIRC does not encourage them, so I won't elaborate here). We opened the product book of an insurance company, with hundreds of categories, but the problem is that most people, including many insurance practitioners, can't understand these products, and they can't pick out the products that just meet the needs of consumers. Not much, not much.

Actually, it's not entirely the fault of the insurance company. In fact, at present, a considerable number of consumers regard insurance as a wealth management product, which is why more than 80% of the insurance in China is dividend insurance, while the traditional insurance is less than 10%. Insurance companies also have to sell premiums to survive, which forces insurance companies to dig deep into the financial attributes of insurance. But in recent years, this point has been greatly improved, and the reflection of "insurance returns to the source of protection" can be seen everywhere.

Another level of homogenization is the regulation of rates by supervision. Take auto insurance as an example. In China, different kinds of people drive the same car, the premium is the same, and the prices of products sold by different insurance companies are similar. Therefore, we can only dig deep into channels and provide value-added services to acquire and retain customers, which in turn forces insurance companies to become sales companies and service companies. Therefore, consumers, insurance companies and regulatory agencies are intricately intertwined, resulting in the complicated status of insurance products in China today.

4. The comprehensive quality of employees is not high.

In the west, especially in the United States, such as insurance salesmen, it is a very tall industry. Because the United States is engaged in comprehensive sales, and insurance is an important and complicated part of personal financial investment assets, only high-end financial talents can provide tailor-made comprehensive product promotion for consumers from the perspective of combination, which is why insurance salesmen in the United States are all college students, and they are all excellent college students. But China seems to be the opposite. I don't know when it started, but insurance salesman seems to be a derogatory term.

Indeed, objectively speaking, most insurance agents on the market are aunts. There is nothing wrong with my aunt selling insurance. The problem is that there is an old saying in China called "Birds of a feather flock together". So according to this theory, the people who are promoted by aunts are generally aunts ... So-called white-collar workers with insurance awareness, who can they find to promote their insurance?

This leads to an interesting situation in China insurance market-people with insurance awareness find that they don't seem to know where to buy insurance; People who don't believe in insurance always sell insurance. However, in recent years, western learning has spread to the east, and large domestic insurance companies have also realized this problem and started to test the high-end insurance sales team, so I won't go into details here. This also objectively gives Internet insurance a possible opportunity.

Second, the four major challenges faced by Internet insurance

In fact, I asked a question from the beginning: There are various models in internet plus. Why has Internet insurance been tepid? With the foreshadowing of I, the second part can answer this question. In fact, it's not tepid, but it goes out every time the fire rises and ends in failure, at least three times. So here are four challenges that Internet insurance has never done.

1. Non-standardized insurance

One of the major reasons for the outbreak of P2P is the standardization of credit/wealth management products. For investors, most people only care about the income and duration of products, but don't pay attention to these P2P and baby investment targets. Theoretically, risks and benefits are always in direct proportion, so in principle, the pricing of P2P products should include risk valuation (whether domestic P2P platforms price risks correctly is another question), and only standardized products are suitable for Internet sales.

But insurance is different. Insurance is not standardized. Especially for life insurance products, when consumers are faced with several pages or dozens of pages of product manuals, no one dares to say that they can fully understand them. This leads to a fundamental feature of insurance: the nonstandard nature of life insurance products leads to the important role of people, and there are only two trigger points for consumers to really buy-either "scene" or trust. This is why, after several attempts at internet insurance, it was found that it was not feasible to sell traditional life insurance products directly online, so a middle route emerged-either selling property insurance (aviation, automobiles, etc.). ) or move the agent online. So are there any suitable life insurance products online? This is another story.

2. The "scene" of insurance.

This point has been described in the last article. But the second challenge of internet insurance is coming. There are a wide range of insurance scenarios, both offline and online-hospitals, airports, kindergartens, e-commerce ... Online scenarios can become endogenous channels for Internet insurance, but offline? Since insurance products are humanized, can offline scenes be moved online?

3. Insurance Internet cannot be separated from insurance companies.

Also refers to P2P. In fact, there is another key point that P2P can break out, which is often ignored by everyone, and that is the relationship between P2P and banks. Both ends of P2P, whether the target or the investor, can be separated from the bank in essence. The direct benefit of leaving the bank is that it can grow wildly without supervision, because financial supervision is bound to have inherent risks, which is also an important reason for the emergence of 2000 P2P companies in 1 year. Insurance is not. Selling insurance products is only the first step.

There are many follow-up work such as underwriting, compensation and investment, which are inseparable from insurance companies; More importantly, according to the current supervision, as long as the premium is collected, the premium must be placed under the insurance company license. This means that Internet insurance cannot get rid of the clutches of insurance companies from the endogenous, and must be accompanied by insurance companies. The sword of financial supervision is hanging, and it is also the sword of insurance. It is extremely cautious about risks and is left-handed with the Internet thinking that emphasizes subversion and liberation. Unless it becomes a pure internet insurance company, it is easy to talk about internetization, which is another story.

4. Adverse selection of insurance.

To illustrate this problem, we will talk about an important essence of making money through insurance. The most primitive form of insurance is to earn probability money, which is the so-called dead difference, and then there is the so-called spread and fee difference. In other words, the underwriting group must be large enough to satisfy the law of large numbers, so that the money of people who have no accidents can be supplemented to the people who have accidents and insurance companies.

From the evil point of view, the favorite groups of insurance should be those who are passively persuaded by alarmists, because their probability of getting out of danger is not high; My least favorite group must be those who take the initiative to buy insurance. How can people who don't travel all day take the initiative to buy aviation insurance? Therefore, another important paradox of Internet insurance is deduced here: Internet channels skip people as intermediaries, which means that consumers must take the initiative to buy, and the group that takes the initiative to buy is likely to have a high probability of going out of danger, while the group with a high probability of appearing is likely to make no money. Therefore, the hidden target group of internet insurance is likely to be a group that does not make money.

Three, the seven trends of Internet insurance

Although the insurance industry has its own ills and Internet insurance has unavoidable challenges, we firmly believe that the pace of continuous evolution of business models must be irreversible, although this evolution is bound to be a spiral and tortuous rise. According to the evolution path of internet finance, the author thinks that internet insurance may also evolve according to the three-step rule of channel innovation-product innovation-model innovation, but because consumers have been over-educated by internet finance, I am afraid that the pace of these three steps will be much more compact. The future has arrived. At present, we may see seven development directions of internet insurance, some earlier and some later; Some are subversive and some are micro-innovative.

1. Split and refinement of insurance value chain

At present, insurance companies take everything from customer acquisition, underwriting, claims settlement and investment. But in theory, in fact, there may be subdivided players in terms of obtaining customers, making claims and investing. An irreplaceable part of an insurance company is the carrier of its balance sheet. Therefore, insurance companies are not necessarily the strongest players in product development, customer acquisition, claims settlement and investment, at least not the only players. Therefore, it is not excluded that the entire insurance value chain will be split and subdivided in the future. This has become a trend in the United States. Google and Amazon have gradually assumed the intelligence of channels and marketing, while new players (Verisk, Guidewired, etc. ) stand out in the field of risk management and claims.

2. Actuarial pricing based on big data and artificial intelligence

As a financial institution, the core of insurance is risk pricing. At present, the pricing of insurance products is based on traditional pricing theories and models (at present, the pricing of many domestic life insurance products is still based on the death table formulated in the last century). With the development of big data and artificial intelligence, it is believed that there will be subversive changes in insurance pricing to achieve more accurate, self-learning and dynamic pricing of various risks. As far as the essence of insurance is concerned, death is the core profit model of chivalrous insurance. So whoever can price the risk more accurately will earn more.

But the progress of science and technology has always been a double-edged sword. In fact, the insurance industry is controversial about the precise pricing of risks by big data. To put it simply, insurance can only turn losses into profits according to the law of large numbers, that is to say, people with high or low risk probability always have to get together to make big money. Assuming that big data develops to the extreme in the future, the differentiation risk of each individual can be accurately defined. Whose money does insurance ultimately earn? There is no discussion here.

3. Customized pricing based on individuals

Focusing on insurance products, as mentioned above, the pricing of basic similar products on the market is similar at present (for example, taking auto insurance as an example). With the deepening of the second point, differentiated pricing, differentiated products and differentiated division of labor will inevitably appear in the future. For example, a 30-year-old woman, a VC, drives a red sports car, and the auto insurance in insurance company A may be 100 yuan; But in insurance company B, it may only be 50 yuan. In other words, with the marketization of rates, there will be specialized insurance companies in terms of products and people in the future.

4. Remote information collection, processing and pricing system based on cloud+terminal.

Taking auto insurance as an example, through the innovative car networking technology, the car condition, road conditions and driver's habits are captured and analyzed in real time, so as to get more accurate pricing and more rapid and efficient survey and damage determination. Taking life insurance as an example, combined with wearable devices, users' signs can be collected more accurately, and then diet and behavior recommendations can be realized, and premiums can be re-priced. In fact, some property insurance and life insurance companies have begun to try this approach.

5. Seamless digital background and big data implementation.

The inevitable trend of internal transformation and reform of insurance companies. At present, most traditional insurance companies in China are still manual and static in the middle and back office management and the analysis and processing of their own data, and there is still room for further improvement in automation. Therefore, innovative and easy-to-use digital means to serve insurance companies is still promising.

6. Insurance based on Internet scenarios

As mentioned above, sales insurance must accompany the site. Traditional insurance products are accompanied by traditional offline scenes. With the continuous popularization of the Internet, new "online scenes" have emerged in terms of products, demand and customer groups, such as virtual life and virtual assets, simple and clear special critical illness insurance, bundled insurance suitable for family characteristics, and accident insurance with flexible payment (daily payment and monthly payment).

These types of insurance will be accompanied by the internet phenomenon to a great extent, and there will be short, flat and fast demand. It is difficult for traditional insurance companies to turn around in product development and filing, and it is difficult to meet the requirements of such rapid innovation and rapid iteration, which objectively gives the start-up Internet insurance companies a window period and opportunities. But in the long run, the involvement of peers and Internet giants will inevitably make the competition in this field more and more fierce.

7. Build a pure form of "Internet insurance"

At present, there are too many insurance channels in China, which leads to the establishment of product and organizational structure around channels. Therefore, it is difficult for traditional insurance companies to really do internet insurance-they can't reshape an insurance company from the organizational structure level. Therefore, subversive insurance companies can only reinvent themselves.

The most primitive essence of insurance is mutual assistance (such as western mutual assistance in the United States and Lloyd's in the United Kingdom), and the Internet is actually the most likely carrier to achieve mutual assistance (making it possible to gather geographical location and time). Therefore, from the perspective of real subversion, "mutual insurance" is likely to appear in the form of a truly popular and pure internet insurance in the future: groups with the same needs and interests put funds into a unified mutual aid pool, then come out of the pool after an accident and return them to each other without an accident. Really take it from the public and use it for the people; Risk * * * bear, benefit * * * enjoy. Because everyone's needs and interests are the same (similar people), risk pricing will be homogeneous, and more importantly, it will really eliminate channels and greatly reduce costs.

Mutual assistance is the origin of insurance, so it is not a fantasy. From the regulatory level, this form is also prophetic. Recently, the "Trial Measures for Supervision of Mutual Insurance Organizations" was promulgated, which clarified the attitude, but also raised the threshold.

Fourth, the biggest paradox of Internet insurance.

The author customized the last part of this article as the biggest paradox of Internet insurance. So what is the biggest paradox of Internet insurance? The biggest paradox of Internet insurance is actually Internet insurance, whether it is the Internet or insurance. This question is actually quite difficult to answer without empirical evidence, at least the author has no clear answer. After the uproar of P2P for a whole year, the author draws the conclusion that P2P originated from the Internet, but returned to the financial essence. Is the internet insurance the same?

As a new business model, the Internet itself is very subversive. One of the biggest subversive things brought by the Internet may be the magical valuation theory with the so-called "imagination space". According to this magical theory, the valuation of Internet element companies is not based on profitability, but on the number and data of imaginable users.

Under this theory, the most depressing thing is the traditional industries such as telecommunications, banking and insurance, which have huge realizable users and data. Take the bank as an example, it has a huge number of users and data, and it is more than enough to do big data and credit investigation, but who calls it a traditional financial industry? It can only be valued according to PB below 1 in previous years. This is also the reason why many internet companies are unwilling to get involved in finance and have to stay out of it.

Similarly, what about Internet insurance? From the perspective of insurance, the evaluation of insurance in the capital market is based on intrinsic value, which is why insurance companies must want to make long-term life insurance products. Accordingly, the Internet innovation insurance that is constantly emerging in the market is actually of low connotation value. But from the internet's point of view, it is another matter.

Low-value insurance, even free insurance, has become a clever way to get customers. Indeed, the cost of high compensation may be cheaper than the increasing cost of traffic acquisition. According to this logic, after obtaining customers, the next step is to hope that these "users" can buy high-value insurance products. Of course, whether this step can be achieved is still unknown.

So consider leaving this question to readers, I hope everyone can express their opinions!