The big trend that has transformed life insurance distribution is obviously the advent of digital channels: insurers’ websites, social media, mobile devices and the like. But it’s easy to make the mistake of assuming that consumers are simply shifting from traditional to digital channels, and that young consumers are big users of these channels while older ones are slow adopters.
The reality is more complex.

Accenture research shows clearly that most customers have not abandoned agents in favor of online channels—they have diversified their channel behavior, preferring different ways of engaging with their providers for different purposes. And secondly, a fact that is confirmed by another Accenture survey, there is no consistent correlation between channel preference and age—or most other demographics, for that matter.

So what does all this mean for life insurers?

Key success factors

  • A multi-channel distribution capability is essential, not necessarily for selling, but for enabling convenient communication and the provision of a rich customer experience.
  • The integration of channels is vital to operational efficiency, a consistent and scalable service, and the enterprise-wide collection, analysis and utilization of data.
  • Insurers need to develop an efficient model for advice-led distribution. This could range from face-to-face advice that carries a fee, to a digital experience that explains how “people like you” have considered specific product sets, to an industrialized process that delivers basic advice at scale.
  • A big advantage of new digital channels and technologies is that they are more scalable, and can meet customers’ needs at a lower cost, than traditional channels.
  • At the same time, digital technologies and innovations like social media can make an enormous difference to the productivity of tied agents and brokers.
  • To become truly customer-centric, and deliver a differentiating multi-channel experience, carriers need to transform their business model from one that is tied entirely to product revenues to one that has targeted customer segments at its core.

If you can tackle these issues effectively, you will be well on your way to achieving strong growth and a level of distribution efficiency that will be the envy of your peers.

The next post in this series will focus on cost management. If you would like to read the pieces that preceded this one, click here.

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