The voice of the customer is louder than it’s ever been before. Their demands continue to increase and change and they are behaving more and more like Millennials; choice-rich, patience-poor and difficult to please. Expectations today is that everything is ’always-on’; people expect responses in real-time. They value personalisation and seek convenience from the brands with which they interact in any industry.
The insurance market place is just as challenging. The ubiquity of connectivity and big data are revolutionising the insurer operating model, disrupting distribution and transforming traditional customer service channels.
Competition has evolved with the entry of non-traditional InsurTech players who present both challenges and opportunity for partnerships. Differentiators are becoming more elusive. Brands are constantly seeking new means to reinvigorate slow growth, keep costs contained and free up profit pools which are under siege.
Seizing the opportunities
Many insurers are undertaking digital transformation projects to enrich the customer experience through the introduction of mobile apps, websites and other digital offerings, such as telemedicine. The use of big data presents a tremendous opportunity for insurers to drive increased operational excellence and an enhanced customer experience, however this means insurers need to reinvent themselves as real-time risk consultants that can anticipate and adapt to customer needs through the provision of automated, personalised solutions.
With the vast amount of data available – structured and unstructured, historical and real-time – the challenge for insurers is to understand what needs to be captured and analysed to achieve real-time insight that benefits customers and mitigates risks.
Although having access to more data does not reduce risks, it can increase insurers’ understanding of them and therefore enable the provision of better prevention advice on an individual level. Data-enabled insight drives a highly personalised approach to insurance which will continue to drive the shift from compensation to risk prevention by incentivising lower risk behaviour, thereby minimising financial losses for insurers and increasing loyalty by providing an improved, personalised, customer experience.
Modern technologies now give insurers the unprecedented opportunity to tailor and personalise products to customer needs. The availability of real-time data also means that policies can be adjusted far more quickly to accommodate changing circumstances. At the same time, the emergence of apps, telematics or health trackers offer insurers many more touch points to engage with customers than in the past.
The ability to offer tailored policies, as well as maintain an ongoing dialogue with customers, is going to transform the once product-focused industry with low level of customer involvement into one which truly puts the customer front and centre.
Digital technology has changed the face of the insurance industry. We are witnessing a sea change in the way insurers operate and organise their capabilities, with data security, data privacy and data transparency now fundamental business considerations.
The future of insurance lies in unlocking the potential of great insurance expertise combined with a real understanding of loyalty and personalised solutions that go beyond the traditional pay and claim mentality. Those possessing the digital capabilities to improve product design and deepen customer relationships, along with the bravery to innovate and disrupt established practices, will emerge as exemplary leaders in redefining the meaning of insurance. The ubiquity of connectivity and big data are revolutionising the operating model, distribution strategy and customer services of insurers, aligning much more closely to the needs and desires of Millennial customers.