Forget science fiction—the Internet of Things is a new way for insurers to get better at customer service, and thus strengthen their businesses.
In my previous two video blogs, I explained that the Internet of Things threatened some disruption to the established insurance value chain—but that it also offered considerable opportunity. Now I’d like to expand on what I see as two of the main points insurers need to take to heart: customer-centricity and creating an ecosystem.
The notion of customer-centricity is becoming ever more critical as today’s connected consumers flex their muscles. As the Accenture 2013 Consumer-Driven Innovation Survey showed, consumers want their insurers to assume a more integrated role, helping them to manage (rather than just insure) risk.
It’s in this context that insurers must see the notion of “connected insurance”. It’s maybe too often seen as a Rise of the Machines scenario, but that isn’t really the issue: what’s important is that machines or devices that are connected yield valuable real-time data that insurers can and must use to fulfill customer expectations. So, for example, travel insurance companies already offer insurance at the time of ticket purchase, but now they can also make the offer as a person enters an airport or while he or she is waiting to board a plane.
So, even if you’re one of those insurers who is still a bit skeptical about some of the more ”the sky is falling” claims being made for the Internet of Things, at a purely business level, I believe you should be seeing it primarily as a source of data that you can use to get close to customers.
In our Accenture Technology Vision for insurance, From digital wallflower to digital disruptor, we identified a trend we named the “digital-physical blur.” It basically refers to the way in which these intelligent, connected devices are causing the boundaries between the virtual and real worlds to blur. Within the insurance context, think of this as turning raw data from the virtual world of connected devices into real-world actions—for example, helping a customer to eat more healthfully based on his health indicators, providing coaching to the young drivers in his family to help them reduce their auto insurance premiums, or scheduling a service of his factory’s fire extinguishers.
When one combines these sorts of insight with the ability to make offer, bill and collect payment in real time via mobile devices… well, the possibilities are just endless. Another example: How about some extra disability insurance offered just as you board the plan for your next ski trip or, even more persuasive, while you are anxiously waiting to get onto the ski lift?
Next time, a look at how to service these expanded customer needs—welcome to the world of the insurance ecosystem.