Other parts of this series:
Earlier in this series I introduced seven innovation trends emerging out of the Efma-Accenture Innovation in Insurance Awards 2017. Notable among them is the Everyday Risk Coach, which will be the focus of this post.
The exponential growth in new technologies such as Artificial Intelligence (AI), Internet of Things (IoT), big data and analytics are facilitating a fundamental shift across multiple industries. In insurance, they represent a disruptive opportunity to transform the client relationship from a single, once-yearly interaction to Everyday Risk Coach, embedding insurers in the client’s day-to-day experience.
We know that customers are open to sharing their personal information in exchange for value, such as tailored advice, a reduction in rates, and ease of use. But our research is also revealing that customers are increasingly open to receiving advice from their insurers, from tips on becoming a safer driver to reducing their risk of property damage.
IoT and an increasingly digitized social world provide a wealth of data. With devices that are in constant communication, clients’ everyday habits can be analyzed and indeed shaped to improve health outcomes, safety, and overall quality of life. Insurers can move from service providers to dynamic partners in their clients’ lives. Auto insurers can use connected cars that analyze driving habits, rewarding safe habits and offering corrections for less safe habits (e.g. speeding, tailgating, frequent lane changes). Health insurers can mine lifestyle data from wearable technologies to analyze risk and reward healthy behaviours.
Italy’s Generali, which won the Global Innovator Award at this year’s ceremony, have a car insurance product, ‘Sei in Auto con Stile’,which analyzes driving behaviour in real-time and offers coaching and correction. The telematics device can alert the driver to potentially risky behaviour and actually reduce bad habits behind the wheel. ‘Sei in Auto con Stile’ represented more than 30 percent of Generali’s new motor policies. More than 50 percent of customers who showed an initial risky driving style improved their composure behind the wheel over six months.
AXA (Hong Kong)’ goal is to move from health payer to health partner. The carrier has developed a mobile app that rewards its customers for making healthy lifestyle choices. It’s chatbot acts as a 24-hour personal coach, providing customized health advice. In a six-month pilot period, AXA noted that 72 percent of active users completed their health challenges. 53 percent of its registered users shared their health data and 52 percent interacted with Alex the chatbot. Based on its pilot, AXA is confident that Xtra will help drive customer acquisition and loyalty when integrated into its health offer.
When deployed strategically, the Everyday Risk Coach model clearly offers a compelling approach for insurers that can not only improve revenues but also have a meaningful impact in their clients’ lives, and on society as a whole.
In my next post, I’ll discuss a fourth emerging insurance trend, Real-time Protection.