RIP Traditional Insurance, Digital Disruption Has Arrived!
Currently Insurers are finding themselves in a
tempest where the digital disruption has caught a few of them completely off
guard. The digital disruption has arrived with a proliferation of smart devices
and advent of the digitally savvy customers. Insurers will have to display
Digital motility to quickly beef up- Customer experiences and Operational
efficiency. Tackling either one of them without the other would lead to dismal
results. Digital insurers need to follow this twofold strategy while injecting
Digital in every aspect of the business.
We are seeing a metamorphic transformation take
place where the consumers, employees & stakeholders are expecting intuitive
experiences and agile responsiveness leading to a buildup of necessity to
innovate on the go.
A
Few Trends That Brought This Disruption
1) Digital is Necessary for Survival:
a. A recent study estimated that 75% of insurance policies
sold by 2020 would be influenced by digital
channels during either the pre-purchase
stage, purchase or renewal stages.
b. Big data analytics is helping insurers discover
trends & patterns which could help them to identify risks and drive down
the claims ratio.
c. Digital is enabling new approaches in pre-sales,
purchase, underwriting and operations and enables personalized offerings and
self-service capabilities that drives down costs and at the same time takes the
experience quotient a notch up.
2) 2) Massive
Cost Reductions & Efficiency Gains
a. Digital is helping Insurers
drive down expense ratio and claims ratio.
b. A carefully crafted digitization program can
deliver massive cost reduction, reduction in turnaround time and vitalize conversion rates.
c. Thoughtful
digitization of legacy insurance processes using STP (Straight through
processing) & Self-service could help insurers achieve tremendous
improvements in operating margins.
3) 3) The
Mobile Age & Rise of the Digital Experience
a. Almost a majority of adults are
using smart devices and with proliferation of connected device in the age of
the hyper connected consumer an impetus will be imposed on the Insurers to
adapt quickly.
b. Consumers have become regulators
by praising the companies providing richer experiences & services and at
the same time reprimanding the organizations where they faced subpar claims
experience or poor service.
c. New players are entering market
to exploit the digital disruption by providing simple processes and
personalized experiences.
4) 4) Digital
Information Avalanche
a. The amount of the data at the
disposal of companies is overwhelming with the proliferation of connected
devices, wearable technologies and social media. Analytics can through all the
digital data and provide insurers with actionable insights leading to better
targeting, pricing & claims ratio.
b. All
this data will help Insurers create better customized products leading to
exponential rise in Digital customer experiences.
5) 5) Digital
Ecosystem Phenomenon
a. Consumers have evolved digitally
by using smart devices for their interactions at every touch point of their
life such as retailers, banks, restaurants, travel services providers etc. and
this makes them expect more and more from the Insurers as well. Insurers cannot
lag behind in this evolution.
b. The
experiences offered by Insurers need to preempt customer aspirations, involve
them in the product creation phase and engage them through the post purchase
phase and claims process.
6) 6) Instant gratification is
catching up
a. Digital
insurers need to look beyond the traditional and innovate continuously.
Embrace
Disruption
1) Lap up Open Innovation
a. Tap into the idea power of
employees, customers and partners.
b. Open Digital innovation labs and
host coding marathons, these are the fertile grounds where you can break the
barriers of siloed thinking and treble collaboration!
2) Invest in mobile to trim the
sales cycle
a. Innovative Insurers are enabling
their Agents with smart devices which helps them in customizing plans using
customer data on the fly leading to better selling & servicing.
3) Create intuitive digital customer
experiences
a. Digital initiatives are more
inclined towards acquiring customers rather than retaining them. Go innovative-
Create applications to engage customers & use collected data to enhance
customer experiences
4) Use
digital channels to generate local leads
a. Our experience shows today's
hybrid customers like to research & compare online but they would also like
to have a reassurance of a local agent.
b. Try and inject agent
recommendations in your digital experiences and provide easy ways for the
customers to find & contact a local agent according to their convenience.
5) Be a Digital Disruptor
a. Digital insurers must innovate swiftly and build an
ecosystem of value for the customers, having personalized and engaging
experiences.
6) Focus on the 4 activities your
customers undertake on Websites, Mobiles & Tablets
a. Our experience shows users
generally take up these online activities while interacting with a digital
insurer: Pay Insurance bills, View an insurance policy, Request for an
insurance quote and checked status of a claim. Digital insurers must strive to streamline the experiences to enhance the
usability and experiences during these encounters.
These are exciting times full of
opportunities for the Insurers, so go ahead and commit to being a digital
disruptor. It is no more about keeping up with your competitors, it is about
continually disrupting the environment!
Comments
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Posted by: insurance broker websites | June 7, 2016 10:45 AM