Why Most Insuretech Connect Talks Will Be About Personalization

The days of traditional insurance are fading as insuretech completely transforms insurance products and services, and their method of delivery. Read on to learn how to successfully personalize your insurance offerings and marketing, and where to start.

According to a report by Youbiquity 3 Finance, 21% of customers say their insurance providers do not offer any targeted services. The same research indicates that 80% of customers are craving personalized offers, and 77% are willing to trade their behavioral data in exchange for lower premiums and quicker settlements.

With COVID-19 exposing a vast segment of the population to the delights of stellar online services such as Amazon and Apple, consumers now expect every company and every industry to offer this same level of professional service… which increases expectations for personal insurance.

Jim Caroll, Trends and Transformation Expert at J.A.Caroll Consulting

There are many revolutionary companies that are gaining from the personalization approach — including Lemonade, Metromile, Cuvva, and Neos-a Home Insurer. InsureTech Connect’s upcoming talk will be centered on personalization as a method to increase customer retention and bolster revenue. Let’s take an in-depth look at this topic, in the run up to the ITC talk.

What Does Personalized Insurance Mean for Insurers?

Insurers don’t personalize their offerings on the individual level, but rather segment their target audience by a variety of characteristics and then forecast what may seem to be most appealing to them. That’s the key difference between personalizing insurance for a group of similar individuals, versus one particular person’s needs.

Samantha Chow, LAH Markets Lead at EIS Group Ltd

Insurers with powerful data analytics will be able to deliver much-needed individual personalization and will be better positioned than their competitors. Earnix, an analytical software company, predicts that better personalization tactics can result in increasing revenue by 60% per customer, improving customer engagement by 89%, and growing broker channel effectiveness by 60%.

The business benefits of personalization are clear: sales, customer loyalty and engagement, and a higher success rate when cross-selling.

Gordon Watson, Chief Executive Officer at AXA Asia

Real-World Examples of Success

Root offers personal auto insurance policies through telematics devices that record customer behavior. This approach enables them to tailor bespoke policies for each customer, while effectively handling risk management.

Metromile, on the other hand, tapered its services by providing personalized policies depending on miles driven (as opposed to driving behavior). Bear in mind that these two companies are new players (or small fish) — yet they are performing incredibly well.

Personalized Insurance: Where to Start?

With customer experience, you must find out what a particular customer or a particular segment of customers want. Do they want more payment choices? Do they want a dedicated call center? Do they want advice on how they can keep their premiums down? Do they find your billing process to be long-winded? By zeroing in on these and other client pain points, you will be able to effectively cater to their growing demands.

If you don’t have a lot of data, then you might need to reach out to customers via interviews, emails, phone calls, messages, or web-based cookies to learn what they need. But to guarantee quality data, you need to enlist third-party sources that can provide more detailed information about your customers. For instance, for US-based insurers, Samantha Chow suggests enriching data with records delivered by LexisNexis, TransUnion, Motor Vehicle Records (MVR), Medical Information Bureau (MIB Group), and Milliman.

Our 5 step path is: (a) listen to customers, (b) figure out their stated needs as well as their latent needs, © review the current landscape of systems and processes, (d) re-engineer/reconfigure them to meet customers’ needs, and (e) deploy the right technology stack.

Also, build clear strategies around the usage of data and analytics, as these form the basis of your personalization efforts.

KV Dipu, Head of Operations Bajaj Allianz GIC, Asia

For those in limbo, or who are still grappling with personalization efforts, the upcoming ITC meeting will illuminate many mysteries. Why do we think this is going to be key on the agenda? Because most of the speakers — including Christian Mumenthaler, CEO of Swiss Re — have already rolled out personalization approaches in their companies.

Personalized Insurance Packages

Flight specific drone insurance is offered on a case by case basis. Life and wellness policies are based on real-time healthcare information — if I show good blood pressure and glucose control with an active fitness regimen, I should get a break. And obviously, there is performance-based auto insurance. Anything which is easily measured and instant, or fact-based, and which has a fast-moving, disruptive technology involved is a target.

Jim Caroll, Trends and Transformation Expert at J.A.Caroll Consulting

Let’s consider some insurance packages that you can tailor to suit each of your customers, according to their unique needs:

1. Personalized Health Insurance

STEP ONE: THE DATA

Smart devices and other wearables that send data to insurers are key to providing a real-time insurance experience. When your patient’s vitals indicate the emergence of a serious condition, you can recommend immediate treatment, or send them new content designed to help them change detrimental behavior. This is a situation where the tech comes in very handy.

The prerequisite of any type of personalization, regardless of industry, is data. The way that insurers collect data and how they interpret and use it is critical. While data analytics technologies play a significant role in helping us uncover patterns and support decision making, it is equally important to understand the needs of customers through face to face connection, whether in person or virtual.

Gordon Watson, Chief Executive Officer at AXA Asia

STEP TWO: DATA ANALYSIS

There are many great companies out there that can support insurers if they do not have their own data capabilities. But it’s important to understand that insurers need to be in charge of their own data, in order to be able to understand its value — what data to collect, and implications for data privacy and security. Tools from an external provider then come in to help them analyze their own data in a meaningful way.

Theresa Blissing, Director at Accelerating Insurance

If your data engines cannot venture further than setting up pilot programs, then you need to have them overhauled and replaced with scalable solutions as this is critical to growth. Good examples of companies with powerful in-house data analytics tools are Europe’s AVIVA and China’s Ping An.

In short, your data engine (whether in-house or outsourced) must be able to do the following:

  • collect diverse data types
  • generate comprehensive data insights
  • link data to decision-making

STEP THREE: ENGAGEMENT

You must do thorough research and find every opportunity to create content. Doing this ensures the customer knows that you care about their well-being, and are not just interested in selling policies.

STEP FOUR: IDENTIFYING POTENTIAL ISSUES

And a customer will not be satisfied if they realize that their visits to a bar, or participation in dangerous sports like skydiving, negatively affects their premium. They will, of course, start to leave their phone and other wearables at home. These data inaccuracies can be the cause of instability and require addressing.

REAL-WORLD EXAMPLE OF SUCCESS

Source: Lemonade
Source: Lemonade
Source: Lemonade

2. Personalized Car Insurance

STEP ONE: CREATE CUSTOM POLICIES WITH DRIVING DATA

STEP TWO: AUTOMATED ENGAGEMENT

For those with comprehensive coverage, some assistants can direct a customer to repair shops, contact the nearest towing services, book a rental car, and much more. There are companies like Direct Assurance (a French carrier) that are producing apps with smart features that help drivers enjoy better experiences. For instance, clients can get alerts when parking in the wrong spot, protecting them from unnecessary fines.

STEP THREE: IDENTIFYING POTENTIAL ISSUES

REAL-WORLD EXAMPLE OF SUCCESS

NEED HELP?

If you need help setting up client monitoring, advanced analytics, or reporting tools, you can talk to DataArt. We have experience creating driving style assessment telematics tools to assess drivers’ risk. These tools integrate with cars and come with a mobile app for collecting and uploading driving data.

Other automotive areas that DataArt can help with include smart ecosystem integration, car-to-cloud communication, Driver Safety apps, smart car applications, and a lot more.

3. Personalized Renters Insurance

STEP ONE: A DIFFERENT APPROACH TO DATA

STEP TWO: CUSTOMER-FOCUSED DATA COLLECTION SOFTWARE

STEP THREE: IDENTIFYING CHALLENGES

REAL-WORLD EXAMPLES OF SUCCESS

NEED HELP?

How Traditional Insurers Can Succeed Through Personalized Marketing

Data Is Everything

The data you get from wearables and other devices should be put into actionable segmentation strategies. Advanced analytics tools like Earnix, Quantemplate, Axis, and Bleeding Edge can then analyze data based on a customer’s location, behavior, and preferences, to unravel personalization opportunities.

The key to remember here is that data is always the starting point for an effective personalization strategy. Once you know a customer’s unmet needs, you can begin to respond with relevant triggers. This then calls for other infrastructure, like mobile apps, insurtech tools, and chatbots.

The Benefits of Personalized Marketing

  • Recognize their customers’ and prospects’ interests, demography, and location for precise targeting.
  • Remember their customers’ history based on what they browse and buy. This can be possible through cookie tracking for web-based clients.
  • Reach out to buyers with the right product, service, and advice based on their actions, interests, and preferences.
  • Deliver personalized digital offers to every customer throughout the year.

Following the above approaches can help you forge long-term and meaningful relationships with clients, optimize prices, prevent losses, and gain a competitive edge in your domain.

Conclusion

On one hand is the privacy issue. But customers are more willing to share their email address in exchange for cool offers. Studies indicate that truck drivers are more willing to be tracked as long as it brings their premiums down. Swiss Re research shows that a lot of people are open to sharing their wearable data in exchange for better policy rates. So privacy is not as big of an issue as many might assume.

On the other hand, advanced digital technologies are helping insurers to create new and innovative products and services. These seemingly minute yet revolutionary steps are giving them the much-needed competitive advantage to stay afloat in the digital world.

If you have not yet begun to personalize services for your customer base, you are missing out. As the industry gears itself towards personalization, your company could find itself unable to compete. But the move towards the future need not overwhelm you — you still have the opportunity to capitalize on the benefits personalization offers.

If you do not know where to begin, make it a point to attend the ITC talks to get expert advice from industry moguls.

Originally published at: https://bit.ly/2HZe3pa

Technology Consulting & Solution Design

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