Last week we examined Accenture’s quarterly Digital Innovation Tracker, focusing on specific examples of what P&C insurers worldwide are doing in the areas of mobile and telematics. This week we will take a look at how digital innovators are rethinking their products and distribution by applying the lessons they’ve learned in the digitalization process.
Along with the increased use of mobility and telematics as I covered in my last blog, Accenture’s most recent Innovation Tracker, just released for first-quarter 2015, focuses on the following trends:
- Digitally enabled product innovation
- Digital distribution developments
- Social and collaboration tools used to disrupt traditional insurance models
- Insurers internally organizing for digital innovation, and
- Open innovation in insurance.
The digitalization process completely changes the conversation in insurance, from an insurer-to-customer model to a customer-to-insurer focus. Digital innovators recognize this and are using increased online interaction with consumers to design creative new products and distribution methods based on changing customer behavior and preferences.
Nowhere is this shift in thinking more evident than in the new product arena. I particularly like that these products are taking the form of a services and value-adds to the insured more than anything else. Some recent examples highlighted in the Q1 Innovation Tracker include:
- Roland Schutzbrief-Versicherung, a midsized German P&C insurer, has developed an online protection radar which continuously monitors the usage of policyholders’ personal data on the Internet, issuing an immediate warning if it detects data misuse.
- RSA, the 7th largest private auto insurer in the UK, is targeting drivers under age 24 with “More Th>n Sm>rt Wheels,” a black-box telematics insurance policy with a smartphone app that tracks driving frequency and safety and provides up to 10 percent discounts on annual premiums for drivers with good scores.
- Porto Seguro, Brazil’s largest P&C insurer, has introduced Auto Jovem (Young Motor Insurance), a product targeting the 18-to-24-year old demographic with a 30 percent discount in premiums at sign-up. A telematics device tracks driving behavior, and policyholders can check their performance through a mobile app, Facebook or Auto Jovem’s relationship website.
Insurers have also been revamping their distribution models to seize the opportunities presented by digital, allowing them to expand their reach through quick sales from retail kiosks and vending machines, and with online registration and digital scanning of car registration documents.
A few recent examples cited in the Q1 study include:
- Benefia Towarzystwo Ubezpieczen S.A., a Polish P&C subsidiary to Vienna Insurance Group, has established an alliance with retail chain RUCH to sell car insurance through RUCH’s kiosk chain.
- BB Mapfre is targeting Brazil’s uninsured population with its policies sold in gift-card format through vending machines at supermarkets, retail stores, shopping centers, and metro stations.
These examples plainly show how P&C insurers are heeding the call of the customer and responding with products and distribution methods that are personalized, interactive, simple to purchase, and flexibly priced.
Next week I will continue to examine the Q1 Digital P&C Innovation Tracker with a closer look at how digitalization is changing P&C insurers’ internal processes.
Other papers on the topic that you might find useful: