When nothing is sure: keys for insurance companies in a fragile world
Just like many other sectors, the insurance industry is nearing a crossroads where, among other factors, the impact of technology, new consumption and consumer models, and the arrival of new “techie” competitors converge.
The disruptive capacity of technology is already evident in many sectors. For example, Airbnb has put the hotel sector against the ropes and Netflix or Spotify have revolutionized how we distribute and consume audio-visual and musical content.
In the specific case of insurance companies, there are other factors that contribute to a change in the traditional status quo in the sector, such as the collaborative economy, carsharing or the philosophy of ‘non-ownership’; all calling into question the number of policies subscribed by vehicles both in developed and emerging markets.
This framework of threats is completed by other contemporary factors like climate change-and its effects on coverage against force majeure or natural disasters-new regulations (or the lack thereof) that define the role of the new technological actors present in the sector and, above all, an unstable economic context that has a direct effect on consumers’ purchasing power.
Lastly, we can also highlight two consumer profiles defined by different generations and consumption habits. On one hand, an ageing population averse to change; on the other hand, the still inscrutable millennials, among whom big brands are finding it more difficult to build loyalty.
Playing it safe: a sector full of opportunities
Just like in anything else, we can see the glass half full or half empty, and view the current moment as a time in which technology is synonymous with risk or opportunity.
The latter, in the insurance sector, can be found for example in big data–to predict meteorological patterns that reduce claims–, wearables–to monitor vital signs linked to health care policies–or in actively listening to clients with new digital channels and 360º strategies.
Furthermore, in “Insurtech: a golden opportunity for insurers to innovate” (March 2016), PricewaterhouseCoopers referred to the great opportunities that can be found in the sector by creating alliances with startups and other technological companies in the creation of new types of policies related to digital phenomena, such as cybercrime or driverless cars.
It also focuses on this new consumer profile–seen as a challenge and an opportunity–and how they are requesting new ways of relating with their insurance companies. Simplifying contracting processes, a greater customization in policies and services, and one-to-one communication rather than the traditional one-to-many communication, are some of the most common demands.
These demands can be channeled through new resources like co-creation with clients, which has an impact on the phases of the customer journey, starting from the first moment the brand is discovered, be it through the opinions of other clients or a more open and transparentonboarding to the company.
The company thus listens to clients and has their opinions in mind, to the point of collecting them to create a more personalized offer or launch new products to the market, which have previously been tested and have a reduced margin for error.
Technology, in this case, is a friend of pro-activity towards the client and certainty.
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