LIFE’S A GAME IN THE WORLD OF INSURANCE
By Rahul Singh, President, Financial and Business Services at HCL Technologies
The entertainment industry is a spectacle to behold, with companies investing billions in creating games that capture our attention for hours on end. However, many businesses have yet to realise that huge benefits in could be achieved in productivity and satisfaction if they used the same techniques that games use to captivate their audiences in a business setting. It’s from this notion that the concept of gamification was coined: taking the mechanics used in gameplay, and applying them to the working environment.
There are a number of ways in which insurance firms in particular have grasped this concept, and we’re seeing this across a number of lines of business such as motor, travel, home, content, and health insurance to name a few. Gamification in the insurance industry has taken off in an attempt to increase brand awareness, improve business and reduce risk, thereby drive cost reduction, but what does this look like in practice?
Creating brand awareness
Insurers are using gamification in many ways – one of the most fundamental ways is by simply sponsoring games upon launch to specifically increase engagement with 8-16 year olds (Gen Z) and build brand affiliation and recall. Today’s Generation Z is increasingly digital; they are often found online and have significant social media presences. As such, many firms are looking at sponsoring games on social media platforms in attempt to foster brand affiliation from a young age.
However, insurance carriers need be wary and avoid sponsoring games that could have negative impacts on society or portray controversial subjects as this could end up increasing the likelihood of damage.
Better informing customers
At the same time, one of the key areas exploring gamification this is using games as a method educating customers about potential risks and imparting useful information to help them be safer. This is particularly prevalent in travel insurance, as travellers typically spend long amounts of time on flights or on trains, where they will usually read, watch films, or play games.
Insurers can take advantage of this time by using knowledge-based games to provide information on the locations that the traveller is about to visit. For example, they can provide Q&A style games based on the specific traveller’s itinerary, which can share precautions on their destination such as common phrases, past statistics on thefts and emergency procedures. The information shared by these interactive games will resonate stronger among consumers than typical information leaflets, and will ultimately help travellers remain safe, as well as help the insurer to reduce potential claims.
Meanwhile, some home insurers doing this by developing games that simulate common building layouts. Customers are then encouraged to choose the items within each room that they would like to insure. When the item is picked it gives voice and/or text information about the cost of the item for the user, and can provide advice and tips for reducing the cost. It can then provide discounts and offers. In fact, a leading US insurer has developed a similar simulated home, where items can be placed in each room, and insurance costs are calculated for them.
Reducing risk & driving cost reduction
Naturally, one of the highest priorities among insurers is to reducing the risk that customers put themselves under. If insurers can reduce claims, they will ultimately improve cost reduction, so this has been a natural area of focus.
Health insurance, as an example, is taking major strides to use games to reduce customer risk. One such was is that they are starting to give discounts and premiums for those who use pedometer to record their number of steps they walk and keep themselves fit. What’s more, gamification is being used to support the treatment of chronic diseases such as Attention Deficit and Hyperactivity Disorder (ADHD) or Attention Deficit Disorder (ADD). The gamification approach is said to have the effect of decreasing the span of treatment thereby reducing the overall need for medication.
What’s more, motor insurance companies are approaching gamification through an idea called ‘smart driving’, where customers are encouraged to take courses or online training games or simulators, in which high scoring participants get discounts on their insurance plans. Achieving a high score on one of these simulators is an indicator that the player is better able to avoid car accidents due to their alertness and quick decision making abilities. This is a sign that they would be better placed to avoid an accident in real life, and thereby worth discounting their insurance premium to get them on board.
Another emerging way of gamifying motor insurance is through integration with telematics. Here, insurers can collaborate with telematics vendors to gain access to statistics of driving behaviour such as fuel consumption or the number of times brakes were applied. This can then be compared to data from other drivers using the same route in similar traffic situations, which can help drivers improve their driving behaviour. If drivers are aware of the benefits of safe driving – such as incentives and discounts – they will become far more conscious of their driving and how they can improve. All of this can help reduce claims and improve profitable business growth.
Work and play
What’s clear is that there are a number of ways that the insurance sector can approach gamification in business context. Also insurers are applying the mechanics used in games to workplace settings better engage their customers and employees in their processes. In doing so, they can enhance satisfaction and make interaction with their organisation more enjoyable; ultimately helping to create a strong competitive advantage and improve their bottom lines.