Finding more positive ways to engage with customers…and engaging with them more often.
Welcome to my new blog series. It follows on naturally from where I left off last time. That’s to say, if Ireland’s insurers are serious about giving their customers what they want, they need to change. And soon.
The priorities? Finding more positive ways to engage with customers. And engaging with them more frequently. These priorities link directly to the new look insurance marketplace. This is rapidly evolving into a C2B industry. Insurers no longer tell their customers how things will be. Increasingly, customers are telling their insurers what products and services they need…and how they want them delivered. That’s likely to mean distribution happens outside the industry’s traditional boundaries.
To help insurers rethink their distribution approach, we’ve identified five new distribution models that can, in various combinations, help insurers carry on with business as usual, while at the same time digitizing operations and enhancing the experience they offer customers.
The caveat? Choosing where to invest in these models, and how to execute them, won’t be easy. Boundaries are blurring and insurers, brokers, reinsurers, ecosystem partners, employees and customers are interacting in new, often transformational ways. The goalposts are moving all the time, in other words.
The topline message here is that there’s no one size fits all. Every insurer will identify elements across the five models that they can mix and match to suit their specific strategy.
Let’s look at the models from a broader perspective. To bring them to life, I’ve provided real-world examples of each one:
1. Virtual Insurance Advisors make purchase/renewals easy by offering choice, counsel and transparency through data-driven, web, mobile, voice-activated and contact centre-based platforms. The objective? Offering personalised, Amazon-style shopping experiences. It’s what Insurify does, simplifying car insurance purchases by letting the customer photograph their licence plate and text it to the site. Insurify generates price quotes, makes recommendations and provides contact details to shortlisted insurers.
2. In partnership with data providers and device owners, Everyday Risk Coaches mine customer use/behaviour data to develop insights and provide advice that reduces risk and rewards customers. Vitality, a joint venture between PruHealth and PruProtect, does this in the life and health sector. With an approach based on behavioural economics, it helps customers take a more active role in managing their own wellness, encouraging them to develop healthy long-term habits that are good for them, and good for its business.
3. Plug & Play Insurers integrate insurance ‘point of sale’ options into other shopping experiences, partnering with online and digital vendors at social platforms, travel sites and retailers. Kasko’s enabling this by offering its API to insurers so they can cross-sell products and services by embedding themselves into websites and apps.
4. Ecosystem Orchestrators aggregate and present to customers a range of value-added products catering to their risk and non-risk related needs. By partnering with, for example, banks, retirement planners and wellness providers, they can increase contact frequency and customer engagement. Tictrac and Munich Re’s Wellgage initiative is a great example. This offers insurers the technology behind a health engagement platform that empowers people to live healthier lives by combining lifestyle signals (from apps and wearables) with contextual information.
5. Last, Peer 2 Peer Network Operators, is an evolution from the affinity group model, where insurers distribute to risk-bearing pools of customers built around personal or professional affiliations. With so much social/digital data around, it’s getting easier to identify and pool peer groups all the time. Bought by Many is doing this, using online search data to identify and create pools of ‘members’ with specific insurance needs. The fintech then negotiates prices/discounts with insurers willing to write for the group.
Next time, we’ll introduce some underlying principles that’ll help insurers to bring these new distribution models to life. Meanwhile, thanks for reading.