Since you've got "Person: " and colons added to your original data, I'd go with creating apropriate XSLT to transform your XML before it'll be imported to InDy (there's an option to treat XML with selected XSLT when importing XML). Other than that it's just simple importing XML into InDy and mapping specific elements to specific styles.
To sum things up: use XSLT transformation while importing XML.
That's not the only way, but I'd go with that since you'll going to need XSLT knowledge (even basic) if you plan to use XML extensively in your workflow. I know XSLT is not a convenient and straightforward technology (could be designed more with people in mind) but it works.
By the way: to add "Person: " prefix before each paragraph, you could set your paragraph to be "bulleted" list with bullet set to empty character and "Text before" set to "Person: ". Try this :).