As the industry enters a post-pandemic era, with hostile market conditions compounded by the recession, how companies navigate the challenges that lie ahead will be key to their survival. Developing a customer-centric environment is essential for all businesses to thrive, with data analytics, resilient systems, and digital transformation playing an integral role when it comes to engaging customers.
InsureTech firms are rapidly becoming a dominant force in the industry, fuelled by ever-demanding, brand-agnostic consumers, with tools such as Artificial Intelligence (AI) growing in importance. Its biggest impact has been the speed with which claims are processed through automation.
Take an app like Lemonade in the U.S., where users can sign up for a policy within ninety seconds, and have claims approved in under three minutes and paid immediately. Having tasted the offerings of these disruptive players, consumers are ever-hungry for the most seamless, frictionless user experience at the most competitive price.
Below are five InsureTech trends, which are shaping the post-pandemic insurance landscape:
1. Insights derived from Data Analytics are the best way to reduce costs and streamline operations. Using analytics to identify how you can improve productivity, release budget for investment in the customer-centric experience or make efficiencies and savings.
2. Using data to enhance Customer Experience (CX): You cannot improve the CX unless you know your customer. Explore that data so you understand their needs and preferences, and use it to create a personalised experience.
3. Insuring and managing risk: Risk profiles are changing and evolving fast. Consider AI, autonomous vehicles, and telematics. Technology can help companies analyse and assess risk across all new areas of business and add value.
4. Finding new growth outside the core: Traditional life or P&C insurance is a saturated market. New solutions, allowing insurers in those fields to explore opportunities in areas such as wellness, personal finance, and new industries, are growing. Sector lines are blurring as companies battle for greater customer wallet share.
5. Securing top-tier digital talent: The insurance industry has historically struggled to attract the best millennial and recent graduate talent, and for many years it has been perceived as an undesirable industry to work in. However, crossover between technology and insurance is changing this. It’s now becoming far more attractive to work in insurance as the sector reinvents itself, with innovative businesses starting to become a strong feature.
It’s not just the technology itself that’s revolutionary, but the way it’s transforming the customer experience. If some insurers can successfully onboard new customers in seconds using automated bots, and process pay claims in minutes, this raises expectations that all insurance companies can do this for customers as this becomes the new norm.
According to McKinsey, the use of data to provide customer insights will be critical to future success. The focus on hyper-personalisation is opening new opportunities for customer engagement. Over fifty per cent of customers switch to other providers because they are offered a better deal. By engaging with customers before their renewal date, and establishing their needs, companies have the best chance of keeping their business and retaining them for the long-term.
Technology is creating an ever-growing list of opportunities that are rapidly transforming the traditional insurance business model, and catering to a new generation of consumers. Truly understanding the different ways AI and automation can be leveraged will prove invaluable to helping companies survive and thrive in a post-COVID business environment.
By Mike Sloman, SVP of business development at Teleperformance