Shifting consumer behavior and expectations have many implications for insurers as they rethink their distribution models for both the near and long term. Ecosystems are changing to adapt and new entrants are disrupting the industry. The following are three distribution avenues insurers can explore to meet these changing circumstances.
Partner with alternative service providers
In Accenture Financial Services’ 2017 Global Distribution and Marketing consumer survey, a significant number of respondents said they’d consider alternative distributors. Twenty-nine percent would consider buying insurance from companies like Google and Amazon. Nomads, a digitally competent segment comprising 40 percent of the market, are especially interested in using online providers such as these for financial services. Insurers who want to tap into this market should consider partnership opportunities to leverage existing platforms that consumers spend time on.
Offer computer-generated advice
Seventy-four percent of consumers are willing to receive computer-generated advice about buying insurance. However, there’s a catch: it must be faster and more convenient. The user experience is of paramount importance.
Price-driven Hunters, a market segment that wants to continue using traditional insurers and financial services firms, are not prepared to depend on computer-only advice, while Nomads are very open to this concept. Quality Seekers are open to the idea as long as it provides faster and more convenient service. You can learn more about these consumer personas in the Consumer Survey report.
Connect customers through peer-to-peer insurance
People are increasingly connected online, fueled by social, mobile and cloud. Peer-to-peer insurance is based on the creation of customer pools—self-insured or otherwise—organized around personal or professional affiliations. Insurers can facilitate the creation of these pools, and then provide claims and policy servicing together with a backstop in the case of large losses.
Fifty-five percent of consumers would consider peer-to-peer life insurance, while 38 percent would consider peer-to-peer auto insurance and 32 percent would consider peer-to-peer home insurance. Peer-to-peer is particularly attractive to Nomads, many of whom are likely already familiar with peer-to-peer services in other industries.
What will your enterprise do to remain relevant in a changing world? The old way of doing business will no longer satisfy consumers who seek more convenient, personalized, and integrated services. It’s time to consider what new distribution models your enterprise should pursue.