Insurers today need the right mix of “bricks and clicks”

Gone are the days of one-size-fits-all products. Today, market segmentation is more important than ever for the insurance industry and is absolutely critical for life insurance products. Accenture’s research found that only 16% of policy owners had any real interest in who their life insurance provider was.

In Europe, the bancassurance model has been incredibly lucrative. Consumers who use the same provider for life insurance and retail banking are typically more loyal, buy more products and services, and are more willing to make recommendations to others.

Banks can be a very productive channel for life insurance because they already have a relationship with the consumer. Further, banks reach a market that is typically underserved by life insurance agents, extending the market focus and position of an insurer.

However, insurers need to make sure that they’re using the bank channel wisely and not simply diluting their offerings. Segmentation is about matching the right product to the right customer. This means developing an understanding of who consumers are, what their needs are and predicting how those needs will change with time. This might mean developing a specific line of products for the bank channel, with less extensive coverage and a lower price point.

By tailoring products to a specific market segment, insurers stand to build customer trust and loyalty. And, as customers are likely to update their bank as life circumstances change, insurers have the opportunity to present appropriate products to match. Whether consumers purchase a home, buy an additional car, go back to school or have children, insurers can provide the right product at the right time. For more information, download Accenture’s 16-page report on how to retain customers for life.

Finally, it is about delivering products in a way that the consumer expects it. Historically, this meant the traditional insurance model of talking over the kitchen table. Today, this might mean the ability to purchase insurance online or through a mobile phone application.

Getting the most from the bank channel isn’t about selling the same product to more people; rather, it’s about identifying a new market segment and providing products that fit its needs.

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