Other parts of this series:
As consumers grow more open to new ways of buying insurance, carriers can prepare for new roles and relationships.
Consumers are open to new ways of buying insurance. Complex products and poor buying experiences have contributed to consumers’ openness to consider alternative ways to acquire insurance coverage. Technology and other forces have already helped blur the traditional lines between many industries, and insurance is no exception.
One barrier to alternative insurance sales channels is consumer resistance, but this appears to be weakening. In fact, Accenture’s new global Distribution & Marketing Consumer Study found consumers significantly more open to considering new insurance distribution models than in the past.
As technology weakens the barriers to buying from non-traditional providers, insurers will feel increased pressure on their role in an evolving distribution ecosystem. New ecosystems will likely be a big part of the future. In many cases, carriers will find new distribution partners in other industries, like selling auto insurance through car manufacturers and dealers. Some may team with partners who can provide additional customized, high-volume, real-time services that differentiate their brand. Others will continue with their traditional agent, broker or advisor distribution partners but provide them with powerful digital, automation and intelligent solutions to better serve their customers.
In successful ecosystem partnerships all parties must benefit, so the right fit is important. While some carriers will set up their own interlinked networks to sell and service insurance, others may look to tap into established networks like those of Google, Apple, Facebook and Amazon (GAFA).
Another area of opportunity indicated by Accenture’s research involves peer-to-peer insurance–the creation of consumer pools organized around personal or professional affiliations. Peer-to-peer involves group self-insurance, where the insurer facilitates the pool’s formation and handles policy servicing and claims, as well as facilitates coverage in the event of large claims.
The study shows that most of the consumer interest in peer-to-peer insurance comes from Generation Y (50%), Generation Z (48%) and Generation X (43%), while only 27% of the Seniors and 32% of Baby Boomers were open to it. By line of business, 55% of respondents would consider peer-to-peer life insurance. That dropped to 38% for auto insurance and 32% for household insurance.
So why peer-to-peer? Our research shows that consumers rank family and friends high as preferred sources of advice for insurance information. Given the interconnectedness of people through social media, peer-to-peer insurance is a natural application of affinity marketing.
Analysis of our research results led to the identification of three distinct consumer personas: Nomads, Value Explorers and Quality Seekers, each with different goals and attitudes. I will explain this further in next week’s post. Stay tuned.
- Download the Accenture report, “The Voice of the Customer: Identifying Disruptive Opportunities in Insurance Distribution”
- Read the first post in this series, “My Insurance Advisor is a Robot.”
- Read the second post in this series, “If customers want price, how does an insurer successfully compete? Simply change the game.“