As insurers move steadily toward a digitally-enabled omnichannel distribution model, the trend to digitization is most notable on the services side of distribution. Over the last couple of years, insurance companies have been investing in their processes to make their services more available to customers. This has been driven not only by customer expectations and a desire to increase convenience and control, but also by the need to reduce distribution costs.
Key features of this trend have been a renewed focus on the contact center, the redirection of agents to handle more complex service interactions and a continued shift toward a full self-service capability. In fact, P&C insurers expect a third of all their personal lines customer service interactions to be fully self-serviced within the next three years, up from 22 percent currently. Life insurers are not far behind, expecting 31 percent of their interactions to be fully self-serviced in three years, up from 20 percent currently.
Mastery of data and analytics will be critical to understanding the potential value of individual customers, the right offers and messages to use, the right channels to reach them and the right time to engage. In a recent Accenture survey, 59 percent of insurers reported that directing customers to the right channel based on their market segment is a priority.
Following on from that, a large percentage of insurance companies are developing customer segmentation models—and setting up functions to support these models—to move beyond their traditional product strategies toward a more customer-centric strategy. This in turn is enabling them to flex their experiences in ways that make them more effective for respective customer segments.
The pace at which insurance distribution is transforming is accelerating. New competitors with novel offerings and a steady flow of technological innovations are reshaping customers’ expectations and changing the traditional insurance landscape. To remain viable, insurers too must change.
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