Other parts of this series:
My first two blogs about Accenture’s survey of over 22,000 European insurance consumers highlighted a growing demand for specific types of personalised services – life and medical insurance where premiums are tied to healthy lifestyles, for example, or automotive insurance with premiums based on driving behaviour.
But doing this successfully requires that insurers can access certain customer data – and that’s getting harder. In the past, some consumers would part with their data without much thought. Today, well-publicised data-privacy regulations and headline-grabbing breaches of personal information have left them much more reluctant to do so.
Consumers, who are reluctant to share data with their insurer were asked: Why are you reluctant to give up your personal data in return for certain added benefits from your insurer?
Insurers need to rethink how they can entice consumers to share their data. The insights from our survey show two initiatives that can help.
1. Develop and communicate a clear value exchange
What do insurance consumers want in return for sharing their data? Importantly, a vague notion of personalised services is not enough: when asked which factors were most important when dealing with banks and insurers, that ranked only 12th on our list of 15 potential factors. Importantly, the appetite for generalised personalised services had not grown in the last two years.
It’s only when specific types of personalised service are presented – like the tailored insurance packages mentioned earlier – that consumers get excited.
Second, aside from personalised insurance solutions, consumers are prepared to share some data in return for promises of specific service benefits. For example, 67 percent would do so in return for faster or easier services.
And third, the cost is important: 64 percent would be willing to share some data in return for more competitive and lower pricing, while 55 percent would do so in return for discounts on non-insurance products and services.
This indicates that insurers must clearly articulate what consumers will receive in return for sharing their data, and then deliver on it. Vague promises of unspecified benefits at some future date won’t cut it.
2. Restore trust that data will be handled with care
Providing consumers with a good reason to relinquish their data is only half the battle. Even if they are convinced of the benefits, consumers won’t share data if they have misgivings about how it will be managed.
Our survey shows these concerns have increased in the past two years: just 31 percent of Europeans trust their insurer to look after their data, compared with 40 percent two years ago. (Europeans are particularly sceptical. In North America, for example, 41 percent trust their insurer to look after their data.)
How can insurers begin to restore trust? There’s no silver bullet, but a good starting point is to convince consumers that adequate data protection controls are in place. That’s because – alongside a sense of intrusiveness – consumers cite as key reasons for not parting with their data their fears that it might be sold to third parties or stolen from their insurer.
An equitable process
Data exchange should benefit both insurers and consumers, though that won’t be easy with trust plummeting and with concerns about cybersecurity climbing in the past two years. However, it’s crucial, not least because consumers are using an ever-expanding list of connected devices in motor, home and health that can allow insurers to radically expand their risk prevention and value-added service offerings.
Consequently, it’s critical that insurers can prove that they can adequately protect personal information and help clients to safeguard their data and digital ID. Those that can do so will be able to build new personalised services and create closer and more profitable consumer relationships.
The onus is therefore on insurers to put in place robust internal controls and cyber-security measures that govern how consumers’ data can be used, and communicate these clearly to customers. Lastly, they should offer tools that let customers confirm their agreement to share specific datasets and manage that data transparently over time.
Disclaimer: This content is provided for general information purposes and is not intended to be used in place of consultation with our professional advisors.