The research we’ve been looking at makes a strong case for change, and our analysis has mapped the five elements that should form part of the revamped customer experiences that insurers must now begin to provide if they are to be winners. But the digital transformation that will be needed is profound.
It’s a move from being a creator and seller of products to a deliverer of customer-relevant solutions. To do that they will need a new and agile business model, enabled by significant digital capabilities—we have identified four on which they should concentrate. Read more about these Four capabilities insurers need on the journey to digital mastery and high performance.
This is not an overnight journey, nor is it a fixed series of steps that each company must follow. We tend to look at it as four-step process. The key point to make, however, is that to compete effectively in the switching economy against the new breed of competitor, insurers will need to become fully digital.
Because, as I said, we don’t think there is a predetermined journey that each and every insurer must complete, we don’t see these steps as a progression that each insurer must follow but rather broad stages in the journey.
- The first stage is characterized by the insurer having a few digital systems that are limited in their features and flexibility.
- At the second stage, the priority is to do the basics right. Some of the channels are integrated and process digitization is underway.
- Having got the basics right, insurers are now in a position to become interactive. Their integrated multi-channel architecture and the sophisticated use of analytics allow them to enhance the customer experience and sell more effectively across digital as well as traditional channels.
- The final stage of the journey is the holistic, omni-channel and fully customer-centric insurer that offers consumers insurance ‘where you are at the precise moment you want it.’ At this point, the insurer has moved from defending its position to taking the offensive: playing to win the ongoing loyalty of existing customers and to attract new ones from competitors that have not been as successful in their transformation.
Only when they reach the final stage will insurers be fully equipped to take the offensive and play to win.