A new Accenture survey has found that property/casualty insurance executives globally are responding to industry disruption by turning to digital insurance distribution models.

Spurred by various forces that often are beyond insurers’ control, carriers are transforming their distribution models at an accelerating pace. Those forces include the growth in the number and popularity of aggregators, the explosion of the Internet of Things and rising customer expectations for living services* as well as service standards set by other industries.  Carriers understand they need to evolve to avoid falling behind the industry’s digital disruptors in satisfying customers and exploiting a multitude of emerging growth opportunities through sales and marketing optimization. Indeed, only one in five of the 414 surveyed insurance executives in North America, Latin America, Europe and the Asia/Pacific region reject the new digital insurance distribution model that is taking shape.

An analysis of the findings of the survey, Reimagining Insurance Distribution, shows that insurers are focusing on six key distribution-related areas:

  • Channel innovation through digitization
  • Insight-driven customer experiences
  • The Internet of Things
  • Ecosystems for customer value
  • The future of aggregators
  • The changing role of agents

In this blog series, I will examine each of those areas, beginning in this post with channel digitization, which is playing an increasing role throughout the sales process.  However, many carriers are focusing more on the early stages of the sales cycle: providing information, advice and quotes.  Among surveyed personal lines property/casualty insurance executives, 32 percent currently offer information and advice digitally, and 42 percent expect to within three years. On the small commercial lines side, 27 percent currently offer it, and 38 percent plan to within three years.

Fewer property/casualty insurers are driving a digital experience throughout the entire sales cycle. On the personal lines side, 21 percent currently provide customers a full self-service option, and 31 percent expect to within three years. On the small commercial lines side, the numbers again are lower: 14 percent currently offer a full self-service option, and 24 percent plan to.

Meanwhile, digitization of the services side of distribution is being driven by growing customer expectations, a desire to increase customer convenience and the need to control and cut costs. Insurers have focused on the contact center, which has resulted in both redirecting agents to more complex service transactions and shifting toward a full self-service capability. Currently, 22 percent of both personal lines and small commercial lines property/casualty insurers have digitized customer service. Over the next three years, 33 percent of personal lines carriers and 29 percent of small commercial carriers plan to.

But even as digital insurance distribution takes root, physical channels will not likely disappear anytime soon. Most insurers expect them to endure, although carriers envision a markedly different role for agents.

To learn more about the study, download Reimagining Insurance Distribution.

Next time: Insight-driven customer experiences and agents’ changing role.

* Living services are designed to wrap around consumers, constantly learning more about their needs, intents and preferences, so that they can flex and adapt to make themselves more relevant, engaging and useful.

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