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MIND THE GAP: CONSUMER EXPECTATION AND EXPERIENCE IN THE INSURANCE INDUSTRY

By Giuliano Altamura, Financial Services Business Unit Manager, Fincons Group

Giuliano Altamura
Giuliano Altamura

What today’s consumers and brokers expect, and what the insurance industry currently offers, are too often at odds. Fundamental change is needed in order to satisfy the ever-growing appetite for integrated, multi-channel interaction with insurance providers -and in a highly competitive market the potential risks of not adapting systems and strategy to provide a more sophisticated and joined-up level of digitalisation are too high to ignore.

The opportunities presented by the modern digital environment have established new patterns of customer behaviour when it comes to the research and purchase of insurance products. It is increasingly clear that people want to engage with their insurer using the full range of modern channels such as smartphone apps, email, social media, website or telephone, at a time and place that is convenient to them.Indeed,industry communications are too often single-channel and inflexible. The tendency to purchase via mobile apps continues to grow and there is an increased expectation that insurance providers will, like suppliers of goods and services in other sectors, offer apps and mobile-optimised sites as part and parcel of their delivery.

In parallel to the challenges of the multi-channel world, Artificial Intelligence (AI) is already transforming vital processes and its status within the competitive battleground is only set to increase. At the front-end, chatbots are increasingly harnessed to automate basic enquiries and assist with policy research, or to offer 24-hour support, and are being embraced by younger customers in particular. Leading insurers are realising that they must take the initiative in adapting interfaces to appeal to the modern audience, and this will see chatbots further developed to incorporate speech capabilities that tap into the young generation’s natural affinity with voice-enabled technologies.

The underlying data infrastructure behind the multi-channel offering is often where companies fail. Success relies upon the organisation’s ability to have a single, consolidated view of each customer and analysing it rapidly and effectively– but if data is siloed across the organisation, it is impossible to have the necessary level of insight into a customer’s policies, preferences and behaviour to enable informed up-selling, cross-selling and personalisation. Of course, the concept of creating a homogeneous, intelligent data repository is certainly not new in the industry, but it remains a decisive factor in how well providers differentiate themselves from competitors and ultimately retain customer loyalty.

A new business model, that provides insurance products based on the customer profile is increasingly becoming main-stream, but it is impossible without access to a full picture of the customer and the insurance products they have taken out across the business be they pet, motor or home contents insurance for example. For this reason,specialist systems integrators are often brought in to assist with the task of pulling together disparate data sources to provide a unified customer view.

We can therefore expect AI to play a key future role in the way that digital data is exploited by the organisation. Based on the single customer view, AI can deliver a new level of insight in customer behaviour analysis, for instance with predictive analysis tools spotting changes in policy holder behaviour and offering timely, tailored suggestions such as a cover amendment. At a higher level, AI is the key to deriving the next level of commercial benefit from Big Data, helping senior managers to analyse customer profitability and risk in more efficient ways and to even inform future product development and marketing strategy.

Digital adoption, both in terms of front-end customer and broker interfaces and back-office data systems, offers unprecedented opportunity to increase market share, satisfy evolving customer needs and ultimately drive customer loyalty.  With other sectors such as retail leading the way in digital transformation, the challenge for insurers is to embrace a multi-channel model that is backed by an intelligent, data-driven infrastructure. This is the only way that they will become more proactive and interactive in their relationships with brokers and direct customers, and deliver the stand-out customer experience expected today.