Anthony O'Donnell: I'm Anthony O'Donnell, and this is Life Accelerated, a podcast for life insurers striving to achieve digital transformation. Last year I had the opportunity to talk to Morgan Spillane of Legal and General's UK Business. Morgan gave us insights into the global landscape of digital transformation within the life insurance industry.
He also discussed the differences between the US and British markets and how L&G America is dealing with the challenges and opportunities that represe. In this podcast we talked to Morgan's colleague Raju who's leading the digital transformation charge for Legal and General in the us.
Raju Seetharaman: We need to change from being a life insurance company who knows how to do technology to tech startup who knows how to do life insurance.
Anthony O'Donnell: Raju was senior vice president of IT and transformation for L&G America. And as you just heard in our conversation, he shares with me the company's mindset shift and what that means for how his team works. Raju also expands on topics raised during our conversation with Morgan, drilling down into how L&G America is leveraging particular strengths to achieve dominance in the US market.
Raju Seetharaman: We want to lift all of the ecosystem to be digital API connected in the cloud so that real time price changes can be executed.
Anthony O'Donnell: Here's my conversation with Raju. So Raju, it's wonderful to be talking to you in the wake of our conversation with Morgan Spillane, chief Technology and Data Officer of Legal and General, about the British company's view of the opportunity in the American market, among other topics.
Now we have the good fortune to talk to you, the person responsible and significant measure for supporting L&G's efforts to increase market share in the. So let's start with your telling us about your current role, how you got there. In other words about your contributions to L&G's digital journey overall.
Raju Seetharaman: Thank you for having me, Anthony. I joined Legal and General in the UK way back in 2000 when there were green screens and mainframes. I was part of the team who started the first e-commerce application, both their first e-commerce application for Legal and General, and I had the privilege of being part of multiple digital transformation programs in the UK.
So currently in the. We have Horizon Digital platform, which has digitized the entire end-to-end new business journey. This is nothing but a person buying life insurance. The experience is completely digitized for all three key stakeholders in this journey. Primarily the customer who's buying it. The agent who is servicing it and our internal admin staff who are working hard to ensure that the policies is delivered quickly.
So all three stakeholders have a digital experience today. I came to the US in end of 2018, part of the investment in the US division and our desire to grow the US division and to cover more American families. That's ultimate goal we have, and we want to reach out to more American families. If you. Us.
There are 52% Americans who have life insurance, and if you then drop it down to the younger population, it drops down to 40%, 35%. So we want to increase that and have more people have access to life insurance. And just going back to the journey from the UK to the us, I came and end of 2018 to digitize this business.
Our goal is to make technology as a market differentiator. For LGA in the US so we make the entire purchasing experience simple, easy and it gives a lot more control to the customer so they make a well informed choice.
Anthony O'Donnell: Let's talk a little bit about how realizing that vision is different in the US from the UK.
It's another way of saying what is L&G's specific opportunity to the US and why does that opportunity. Now you talked about the market being underserved. What are some of the main differences between the UK market and the US market that presents an opportunity for L&G?
Raju Seetharaman: Yeah, so if I look back quickly at the UK journey, as I said, I joined in 2000 and I was lucky enough to be part of the journey where we went to market leaders, like 24% market share. We have our 22 to 24% market share. We have, and we dominated and we have used digital technology as a differentiator. And Bernie Hickman, who's our L G I E, global c o, joined in 2017, he set a vision saying that our future competitors are going to be startups and fintechs.
So we are 180 plus year old company and we know how to do life insurance well. So we are. Life insurance company who knows insurance very well, but we do technology. So he basically said, we need to change from being a life insurance company who knows how to do technology to tech startup, who knows how to do life insurance.
That was a big pivot we had to make, and that is our growth strategy. And then we looked at the US division and we could see the opportunity to expand our market. Most critically reached more American families, which essentially could be achieved using digital transformation and digital changes. So that is one of the reason I came over here and we started this journey.
So when we talk about the differences, there is key differences between the US marketplace and the UK market. Place for sure. One is SEIS and US is a very big country and we have a diverse set of Asian community we work with and lots and lots of state regulators we work with. And the regulatory differences, which, Morgan alluded to as well, the two year contestability.
All of this challenges as to innovate differently in the US compared to the UK to ensure that we achieve our goal of digital transf.
Anthony O'Donnell: Regulation is one big difference. The size of the market and the diversity of its players, shall we say, is a factor to the diversity of the communities of agents and of policy holders and prospects.
You've spoken about the challenges of regulation. What about the challenges specifically associated with distribution? How does distribution differ in the US and what are the challenges and opportunities you see?
Raju Seetharaman: It's one of the diverse distribution systems, distribution community I've come across because on one end you have agents who do one or two application and they submit paper application on one end of the spectrum.
The other end of the spectrum, we have agents who want to process 10 applications and they want to do it quickly, and they are all about instant decision and getting the policy quickly to the customer. So to that extent, our distribution communities is diverse. D two C channels. We have wholesale agents and we have broker general agents, and we have direct marketers.
Everybody's trying to reach the customer so that the customer benefits out of this ecosystem by getting the life insurance easily and quickly. And by virtue of this diversity, our innovation effort has to be slightly different in the US compared to the UK, and we have to develop different solutions which are tailored for all of these agents.
Ultimate goal for us is to enable the agents to sell more. That's what it is all about. Make their life easy, give them opportunity to sell service, put them in control so they don't need to make telephone calls and call up people to get status. Status updates should be delivered to them. You order a pizza, you get updates on pizza, and you have a pizza tracker, which is what is happening.
Similar to that, in a life insurance buying experience, we want to self-service and push notifications to the agents and intern to the customers so they are fully aware of what is happening and how easy it is to buy and have a good experience buying experience.
Anthony O'Donnell: How do customer expectations differ?
Agent expectations differ in the US for example, with regard to appetite for self-service.
Raju Seetharaman: We have a, again, a diverse set of customers in terms of there are customers who are having preexisting medical condition for whom the underwriting process takes longer because we need to look at medical evidence.
Again, that takes longer. So we need to manage expectations slightly differently with them and for the agents, and there are younger demographic who are, don't have any pre-existing medical condition. They have. Expectation of instant decision. Instant issue. So for them, we have a slightly different solution, which allows them to get the policy in minutes and days.
And for the people who have preexisting medical condition, we have to look at all the medical history and all the medical details, which takes a bit longer. So we manage expectations slightly differently for them. So both of them get a good customer experience.
Anthony O'Donnell: So one of the things that you've had a lot of success with in the UK is pricing flexibility.
We've spoken about this before. and I was fascinated to hear just how quickly you can react. And I wonder about how that kind of expertise, that kind of achievement can play out to help you to be more competitive in the US.
Raju Seetharaman: Great question. Pricing flexibility is something I'm very, very proud about. What we have in the UK and what we are building right now in the US as well, and typically in the US most carriers would do two or three or four price changes per year.
So we currently are doing 15 price, three prices per year, but we, in the uk, we do in hundreds basically. So the goal here is to get the best product possible to the. And for the agent, and particularly when the agent is looking at whole of market, like some of our partners like Sello and others, then they want to ensure that the customer is getting the best price and from the best carrier.
So we want to be there at the forefront of it, offering the best price for the customer so that the customer and agent are making the right choices, which means that we have. Quickly to the changing dynamics of the marketplace and we, our underwriting rules tweak our pricing rules accordingly so that we can react quickly and we are continuing to be competitive.
Ultimately, we want to push this market, the life insurance marketplace in the US in the right direction. So we are all as carrier community moving forward, offering the best price possible for our customer.
Anthony O'Donnell: Maybe you could drill down a little bit into the kinds of capabilities you have. Like how do you respond to price changes as they're happening in the UK and I don't know to what extent you achieve.
Raju Seetharaman: Yes. In the UK we have been doing this longer as an ecosystem. So there is a lot more API and smaller country, and the ecosystems smaller. So a API connectivity is available, which means reprises are quick and easy to execute. Whereas in the US it's a lot. Complex of the size because of the size of the ecosystem.
And also some use CSV files, some have APIs. API connectivity allows for real time pricing changes. That's what we want to achieve as a target state, as an end goal. But right now in the US. It is a hybrid system. Some of them take a week, some of them take a day. We are working with the entire ecosystem.
Ultimately, we want to lift all of the ecosystem to be digital APA connected in the cloud so that realtime price changes can be executed not only by us, but most carriers as well as the customers and the agents benefit out of getting the best possible deal. And that is a key difference. And again, we are working with the ecosystem, collaborating, partnering, so that we can achieve it across the board for every.
Anthony O'Donnell: Let's now talk a little bit more broadly into underwriting and the advantages and the traditional strength that L&G has had in underwriting and how that may translate to the work you're doing in the US.
Raju Seetharaman: Yes, we are big fans of instant decision in the UK and in the us. We want to give the customer because life insurance buying experience is stressful enough because you are revealing detailed medical information about yourself.
And it is also about the pricing effects based on your underwriting class. I e Preferred, plus preferred. These are the technical terms we use and each customer wants to get the best price, so they're keen to understand, am I getting an offer? So if you can provide an. Decision in an instant offer while they're online completing their application, then it's a best customer experience.
That's what we are aspiring for. It's an evolutionary journey because here again, one of the key differentiator the US has an advantage is availability of realtime information. So we have a lot of realtime medical information, which is available, which we can process using sophisticated artificial intelligence algorithms and machine learning and underwriting engines.
And so we tailor the questions for each customer according to their personal situation and the answers they're providing. So in simple terms, we have access to data in real time, which makes the experience for the customer highly interactive and in real. But unfortunately, given the data availability, we are able to make it available for roughly around 31 third of the population to speak.
One third of application. Get this still. Two thirds of our customers have to go through a bit of a detailed process of an underwriter looking at the data manually and making an assessment. And that is where the innovation possibilities are there to reduce that more and more, so that we are using data to.
Not fluid or medical information. We'll continue to use some of it, but those information are getting digitized as well, which will allow us to deploy the solution quicker and quicker. And ultimately the customer is going to benefit by having a simpler, quicker, easier process.
Anthony O'Donnell: And how do you feel about your competitive position, like how your capabilities are going to be competitive with those of domestic.
Raju Seetharaman: I think as a carrier, we are the only ones who have end-to-end digital capabilities. When I talk about end-to-end, most of the ecosystem are evolving towards digital capabilities in the front of it. So life insurance buying experience, if I can put it simply as three parts to it, part one. is the application process where you're submitting your medical information.
It's self submitting data based on what the carrier is asking. Part two is the underwriting team assessing the medical information and making an offer. And the third part is the agent and customer working together to accept the offer and make a payment and the policy goes live. That's a three stage.
Then if you look at it in stage one, most companies have some shape or form of digital capabil. because you have digital application to collect. Even there, there is a wide spectrum of differences. For example, our solution has a very intelligent and recursive it is called because it reacts to the customer's answer.
So it last one question at a time. Do you have a medical history? Yes. Then what kind of medical history it is and then based on the type of medical history, can keep asking questions into the deep end until it finds all the answers. It's request to make a decision. So that kind of records engine we have.
The application process tailored for each individual, whereas our competitors may have a static data collection, which is basically collect all the data, send it to the underwriter, and then ask additional questions. We do that less and less. Eventually, we don't want to do that in the second part of it.
Again, we have digital capabilities where we are getting the information, we are processing it, and then making it available to the underwriter so that their job becomes easier and easier. And the last part, we definitely are the only ones who have digital solution. We make an offer. We sent it to the agent.
Agent validates and sent to the customer. For example, you have a, let's say, a need to apply for a million dollar policy and hypothetically say that it has taken three weeks to offer a policy to you. And because there is lots of medical information, we did look at, and let's say after three weeks, your situation has changed.
You wanted a. One and a half million. So for every other carrier, it has to go back to the carrier and they have to re-craft and all of that. Whereas for us, there is a sliding bar which says that you're approved up to 2 million and you can adjust asset, and immediately it'll tell you the additional premium and then you can make an offer.
So that. Capability we have. So going back to your original question, we seem to be at the forefront of digitizing the entire journey so that we can pull everybody else along with it, ultimately making it easy for the agent to sell. In turn, more customers can be approached by the agents to sell life insurance policies.
Anthony O'Donnell: So Raju, what would you regard as your three indispensable
Raju Seetharaman: initiatives? I think the top of it is always underwriting innovation. We are always innovating. We are always finding new ways to access information so that we make it easy for the customer to submit or easy to buy, and it's easy for the agent to service the customer.
That's what our goal is. So underwriting innovation is a number one. Focus area and during pandemic, it really accelerated because all carriers needed to find new ways to underwrite because the fluid access to fluid was suddenly not there because it was going into people's home to collect fluids was difficult during pandemic.
That drove innovation in a sort of indirect way in the industry. So for us, that is a key area of focus. In terms of underwriting innovation, we have more to do and that is one area we are focusing in lot. The second area is what we call case management, or how the agent is managing expectation with the customer while they're waiting for a policy.
So that is where the status feeds and giving them lots of tools to self-service is a key focus area. We continue to focus on it. And the third area. The pricing strategy, how do we price differently? How do we bring new product propositions? Because we want to give tailored products for specific distributions, specific customer segment.
So we innovate a lot on product. So we will continue to innovate a lot on product, and again, we leverage our UK expertise for that to be able to do that. And those are the three sort of focus areas towards improving, continue to improve so that the underwriting innovation gives them faster edition, quicker edition without a lot of frauding and poking is what I call.
Anthony O'Donnell: Crudely. And then the second part is, yeah, I've been prodded and poked and so I know very well. , I'm you're talking, sorry, on behalf of the industry. Yeah. Honestly, it was one of those things where I thought, this is what you have to do, and the person from the insurer shall remain nameless, was very professional and friendly, so it wasn't as bad as it could be, but honestly, the worst part of the process was at the time, it took weeks and weeks for the whole process to be done.
That's the last time I got life.
Raju Seetharaman: We are improving as an industry. We need to go a long way. The other area of focus also is placement ratio, because for us, this is an industry terminology. It's like if a hundred people are applying for life insurance, how many people are having a policy? Finally, right now it hovers anywhere between 50 to 60%.
For most carriers, we want to be more at a 70 to 80% range. As an industry, and again, we are pushing hard. to get there, and these innovations we are making will help us because the more the customers are comfortable because you waited for weeks to get a policy, some customers don't want to wait for weeks for a customer, we lose the opportunity to service them and they could still be denied.
Anthony O'Donnell: Right? The customer could wait weeks and still be denied, and that's another issue. You have mentioned elsewhere that placement is a problem, right? There's a placement.
Raju Seetharaman: Yes, as I was saying, it takes some time for anybody to assist and realize that they need life insurance and they need to go and buy life insurance.
That the first step they need to take is that I need, and an agent plays a crucial role in helping the customer make the right choices. We make that. Front end, and then we lose the customer at the back end because as you rightly said, they're waiting for weeks and they don't want to do it. And the other critical reason is the increase in price.
You're convinced that a hundred dollars per month, you'll get a life insurance and you end up after six weeks, three weeks, two weeks, whatever it takes, and it goes up to $120, $110. You no longer have the motivation to buy because the price has. So that is another reason why there is a loss of the customer at the back end of it.
So we want to stop that happening because it doesn't help all the three stakeholders involved. It doesn't help the customer, it doesn't help the agent because they have invested time and money for which they don't have anything to show for. the carrier. Also, it doesn't help because we have invested money in time and we are losing a customer, which we don't want to lose.
So we are all working hard to solve that problem. And again, going back to the three areas we are focused on, if you get our underwriting right, if our cycle time and the management of the customer expectation is right and we are the right product, then we are confident that the customer will be happy at the end of it.
And, and using the underwriting innovation, our price difference will be also smaller and narrower so that the customer doesn't have any surprises.
Anthony O'Donnell: What are L&G's secret weapons? What I mean is as you come from another market, what have you learned that you think is going to be really effective?
What are the capabilities you're bringing to this market that are going to give you an edge? Now, maybe that corresponds to the three things you've been talking to. It must partly, right. Well,
Raju Seetharaman: how would you answer that? I think our primary goal, because we are 180 plus year old company, right? We have been doing this for a very long time, globally.
Our first focus is customer. We want to be with the customer when they need the most. That's our ultimate goals, which means we are super focused on price, the product. The mortality risk. All of these areas, we are focused and we have an experience. We have expertise. We know how to do product. Val, we know how to do underwriting.
Val, we know how to leverage technology. We know how to digitize the business to be more efficient and effective. The more efficient and effective we are, we can offer a better price for the customer. We offer a better price for the customer. We have a high probability of acquiring the customer and providing them life.
Ultimately so that we can be there in case the worst case scenario, they need us one of these days. So for us, if you ask us, the core strength is customer focus and product innovation. I think we are all very passionate about life insurance. I know life insurance is very dull and boring topic and in the industry, but, but we are very, very passionate.
We are very, very passionate about life insurance and we are here to transform the marketplace. That's what our goal, our goal is that we should transform. Life insurance marketplace, and I use the terminology, the icing tide lifts all boats. And we just want to be one of those people who are lifting everything up ultimately to the benefit of the customer and the agent.
Anthony O'Donnell: I'm excited about it, not just because I came from Britain to the US to be successful, but because it will raise the tone in the industry. A competition is always good and what you start, what innovations you bring into the industry that's going to make expectations for everybody else.
Raju Seetharaman: One agent walked up to me a couple of years back in one of the conferences and said, I can't believe you don't use DocuSign, and your solution for getting digital signatures on a document is very, very user friendly, and I'm very happy. I can empathize with it, right? We all have used DocuSign to sign a document.
For life insurance, it is 20 years, 30 years, 40 years. So you're signing up for something which you're going to pay premium for 20, 30, 40 years, and it's like 50 page document. Try to go through that in detail using DocuSign or download it and look at it and all of that. It's just tough. We created a solution where you only get five or six information at a time, and you just need.
Tap through that so that you are really understanding everything and you're signing up to something you can understand and you are not flicking through that because it's DocuSign. I have to sign in multiple places. So like that. We want to innovate. We want to innovate differently, reimagine it so that it's a different experience for the agents and customers when they buy life insurance.
And I'm hopeful. My colleagues and my technology colleagues and other carriers are also inspired to join this journey to push the transformation. And you are right. We come from the UK with our experience to say, let's get on with it. It's long overdue. We need to deliver this transformation. See, everywhere else in your gender life, you are digital.
People use one 40 characters Twitter and change the world. So that's the world we live in. And you then suddenly come into life insurance. We are all about paper, telephone calls and lots and lots of information, canning and all of that. That needs to change. And I'm pretty confident that in few years time we would've changed the ecosystem.
Anthony O'Donnell: Let me address you, another kind of general industry question that affects all life insurers in the. How do you view recruitment and retention? How do you attract the kind of talent you need? And tell us about where you are in the us, where your offices are physically in the US.
Raju Seetharaman: So we are outside dc We are in Maryland.
Our office is in Frederick, Maryland. And so it's a nice neighborhood and we have a nice office. Talent acquisition has been a challenge, particularly having come from, London and UK. I can see the difference in terms of the location challenge. And again, US is a very, very big and complex country and it has a different ecosystem.
But in the hierarchy, unfortunately, life insurance is not in the. Tier to attract the top talent, particularly in the technology side because if you're a technologist, you're looking for startups or you're looking for the big fives, the Facebooks, the Google, some Microsoft and all of that apples, or you're looking for those big cities like San Francisco or Seattle or New York.
I know we are near dc but still it is a challenge. So we have pivoted to attract talent nationally. So we do have people who are remote. We also use our global partners to collaborate as well in terms of versus augment. And bringing talent in. So we use different mitigation techniques to manage that particular problem, but we continue to attract good talent and manage that risk in a way in which we continue to innovate and transform this marketplace.
Anthony O'Donnell: So Raju, what do you figure, L&G's chances are for increasing its market share in the US.
Raju Seetharaman: On Word. It looks good. It looks good, but it is not an even journey upwards. It's gonna be a bit of up and down, which we know it'll be because we are innovating, we are changing. The marketplace is also transforming, but I think we are best placed to succeed.
It would be my confidence level primarily because we are good people. We have excellent team. We have excellent thought leaders and innovators and transformers. Within the last two, three years, we are really acquired and the people. Who have been here for 10, 15 years, they know how the business should be transformed, how we should be reimagined because I call them, they're all battles cars, right?
You know, you have problems, you know, what has gone wrong, what we should do to change it. So there are a lot of people who have good battles, cars, which we leverage to reimagine the business. And there are new talent in the last two, three years, L&G built, which is challenging the status quo as well. So it's a very interesting times to work for LGA and innovate and transform the opportunities ahead.
And all we have to do is try and if you try and we use agile again, we test and learn, we fail fast. We do releases in cadence of every two weeks, which means we take any feature very, very quickly to the market tested, refine it and upgrade it. So it's exciting times to be in L&G because we have machine learning, we have artificial intelligence, and all of those technology innovations that is happening in the wider world, we are able to apply it within the life insurance sector.
So your chances are, Definitely. It's cautiously. Definitely.
Anthony O'Donnell: Alright, thank you so much Raju. It's exciting to hear about what you're doing in the market.
Raju Seetharaman: I'm gonna be watching. Thank you. Thank you for the opportunity.
Anthony O'Donnell: The conversation with Raju was exciting as another look into a dynamic and important company executing digital transformation.
It was especially interesting as an example of a foreign company with ambitions to increase its market share in the. On one level, L&G is a threat to domestic companies, but I think it's more important that L&G will help to drive the industry to higher levels of. It was interesting to hear Raju speak to the use of data in real time customizations for the policy holder during the buying experience and about L G's advanced pricing capabilities.
The way L&G is using AI to provide a highly customized and personalized experience is again, to many other customer facing interactions that US consumers are already used to. So L&G's early adoption of this technology for life insurance is a hopeful sign that the industry is not only catching up, but keeping pace with database in.
Thank you for joining us for the Life Accelerated podcast. For more relevant content to help you achieve digital transformation, visit equisoft.com/life accelerated.
