Accenture has long argued that, in order to prosper in the current business environment, insurers have to become digital insurers. We have emphasized that this process doesn’t just mean digitizing the existing business processes, but rather requires insurers to transform the way they do business. This need for digital transformation is driven primarily by profound changes in the desires and behavior of consumers.

What we are seeing is the emergence of a new demographic, which we call Generation D, or the Digital Generation. Unusually, this group is multi-generational and is defined by its addiction to ubiquitous technology, not its age cohort. Generation D uses multiple devices and, thanks to diminishing bandwidth costs, is online most of the time. In line with its experiences with providers in other industries like consumer goods, Internet or telecoms, Generation D expects to interact with all its service providers across multiple channels in real time, and to receive a consistent and personalized experience across all of them. This fact that is changing the competitive landscape in insurance quite considerably. (More about insurance’s new competitors in a later blog.)

Amazon is a good example of the kind of service experience that consumers are growing used to, and expect from their insurers as well. Amazon has built up a huge business through constant efforts to personalize customers’ experiences by remembering who they are and making recommendations for purchases based on increasingly sophisticated analytics. Amazon also makes the process of payment and fulfillment as easy as possible, again based on customer recognition.

Then there’s the personalization offered by Nike, which allows customers to customize shoes during the online ordering process.

Or consider Flipboard, which allows users to collect their favorite articles and videos into magazines, which can be shared via the website. This is truly customer-curated content, and brings together two key trends: high levels of personalization and the tendency for customers to share recommendations online. Research shows that 70 percent of consumers trust the recommendations posted online by strangers, while nearly everybody (90 percent) trust the recommendations of people they know. This is an insight that could—and should—be changing the way that insurers think about marketing and product development. Read more about this type of thinking in relation to retirement planning by downloading Consumers see the light as retirement shortfall looms.

The application of these trends will obviously vary from industry to industry, but the basic principle is what is important. The winning insurers will be those who interpret these trends best for their customers, current and hopefully future. To deliver equivalent experiences will require some radical rethinking of the way the company works—to become a true customer-centric digital insurer.

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