Next Generation Insurance: Leading from the front.

The percentage of 17-year-olds with a driver's license dropped from 75% in 1978 to under 50% in 2008. Even if you go up two years, the drop is still significant, from more than 90% of 19-year-olds in 1978 being licensed drivers to only 77% of them 30 years later.

The reason for this shrinking of the pie seems to be a) movement towards urban areas with abundant public transportation and b) evolution of digital commerce.

With the rapid evolution of technologies, the second aspect above could only accelerate the change in consumer needs vis-a-vis protection. Auto manufacturers are already doing everything possible to get the demographic into a vehicle - ranging from making the vehicle equate to a "computer-on-wheels" to introducing "community cars" for the infrequent drivers.

The underlying question though is - will this trend influcen a change in the personal insurance products? Can the consumer demand an auto-insurance product that he/she pays for on a need-basis? Can the consumer demand a true "personal protection" product that will insure the individual regardless of the risk?

I guess the answer to all the questions above is Yes. It will be imperative for carriers to understand, engage, sell-to and service the new demographic in ways that they have never done before. How they will react and who emerges as a leader remains to be seen. There is no doubt, however, that it is time to get a lot more personal with the consumer base.

What do you think?

Posted by Sanjay Mohan at 2:57 AM | Permalink | Comments (3) | TrackBacks (0)

Posted by Baskar Sridharan at 8:00 AM | Permalink | Comments (1) | TrackBacks (0)

I recently came across an article on the demographic shifts in the US market where:

1.The multigenerational household is gaining prominence - affecting major purchases, like automobiles, homes and college tuition. With a record 70 million grandparents in America in 2010, these grandparents will be deeply involved with their grandchildren - with decisions often being made by two generations of people - the parents and the grandparents.

2.No household type will neatly describe even one-third of households. The iconic American family (married couple with children) will account for a mere 22% of households. The most prevalent type of U.S. household will be married couple with no kids, followed closely by single-person households

3.Diversity will vary greatly by age - the younger population substantially more diverse than the old . By 2015, 80% of people age 65-plus will be white non-Hispanics and just 54% of children under age 18 will be white non-Hispanics. White non-Hispanics will account for fewer than half of births by 2015

Continue reading "Demographic shifts in the US market and its implications on the consumer buying behaviour" »

Posted by Sanjay Mohan at 6:56 AM | Permalink | Comments (0) | TrackBacks (0)

I recently came across an article on the demographic shifts in the US market where

1.The multigenerational household is gaining prominence - affecting major purchases, like automobiles, homes and college tuition. With a record 70 million grandparents in America in 2010, these grandparents will be deeply involved with their grandchildren - with decisions often being made by two generations of people - the parents and the grandparents.

2.No household type will neatly describe even one-third of households. The iconic American family (married couple with children) will account for a mere 22% of households. The most prevalent type of U.S. household will be married couple with no kids, followed closely by single-person households

3.Diversity will vary greatly by age - the younger population substantially more diverse than the old . By 2015, 80% of people age 65-plus will be white non-Hispanics and just 54% of children under age 18 will be white non-Hispanics. White non-Hispanics will account for fewer than half of births by 2015

Continue reading "Demographics shifts in US" »

Posted by Siva Nandiwada at 6:56 AM | Permalink | Comments (0) | TrackBacks (0)

 Mortgage crisis, Credit crisis, Job losses, Car sales plummet – Welcome to the new economy of the 21st Century global village.  For all businesses including insurance carriers, retention of existing customer is extremely important.  So what do we do?  Launch an elaborate customer data analysis, and create “n” more tiers of segmentation and focus on the top tier (the ones who contribute high volume of premium, no claim whatsoever) and shoo others?  Well, that is an approach for the short term.    What we need is a loyal customer base with a mix of the top tier, moderate and some average- to provide the right customer mix and size that can sustain the value for the long term.  It is another story some of the heavy hitters on the claim side swear loyalty to life!   Jill Griffin (author of "Customer Loyalty: How to Earn It, How to Keep It." ) mentions that  “customer loyalty lifecycle  comprises of six stages: suspect, prospect, first-time buyer, repeat customer, client and, finally, advocate. The goal of all relationship marketing is to continually move a customer to increasingly higher stages within the loyalty life cycle”  Focusing on research that helps you find which lifecycle stage the customer is, what will enhance the value and move them to the next stage will be of great help.

Continue reading "A friend in need is a friend indeed!" »

Posted by Baskar Sridharan at 6:00 AM | Permalink | Comments (0) | TrackBacks (0)

I was in a discussion with a customer on migrating their block of business to a different platform. I heard this concern from that customer that one of their colleagues who came from another industry just doesn't understand the challenges associated with policy data storage for 60-70 years. We went on to discuss at length on how data storage is different in Life Insurance Business from that of P&C Business.

Continue reading "Data Archive challenges in Life Insurance" »

Posted by Umashankar Kotturu at 4:17 AM | Permalink | Comments (2) | TrackBacks (0)