Platform Systems: Foundation for Agility, Speed, and Innovation
09/26/2020
Blog, Digital Ecosystems, InsurTech
Digital Insurance & Speed to Market – It’s Time to Get Your Game On
07/20/2020
Blog, Digital Ecosystems, Future of Insurance, InsurTech
COVID’s Digital Mandate: Insurers Double Down on Transformation & Innovation
05/31/2020
Blog, Digital Ecosystems, InsurTech
Health ecosystems: striving towards an integrated and seamless patient experience
01/28/2020
Blog, Customer Engagement, Digital Ecosystems, InsurTech
Digital Insurance Ecosystems: Rise of Exponential Business Models
10/11/2019
Blog, Digital Ecosystems, InsurTech
The Future of Insurance: A Customer-Centric Digital Ecosystem
04/09/2019
Blog, Future of Insurance, InsurTech
The future of insurance is already upon us as traditional insurance companies incorporate more tech-savvy features into their options, and giant tech companies offer insurance services. Insurers, brokers, InsurTech companies, and companies such as Amazon are changing the foundation of insurance into a digital ecosystem providing connected insurance and value-added services for customers.
Insurance technology has been developing at a rapid pace in the last decade. Software robots can now mimic human actions and produce repetitive tasks across multiple business applications; FinTechs and InsurTech companies have made major inroads by creating powerful applications that handle problems and deliver high-quality digital experiences. Mining social media data is improving risk assessment for insurers, increasing the capabilities of fraud detection and enabling new customer experiences.
The future for insurance is a connected insurance atmosphere, a digital playground for everything from tech giants to hip startups. As platform providers change and become more dominant within these ecosystems, they’re beginning to change what is required to compete as an insurance provider.
Connected Data Boosts Innovation
Insurance companies, such as Progressive, began capturing real-time data from customers. Data-capturing devices and connected data coupled with predictive analytics and machine learning are delivering not only improved customer experience and overall satisfaction but better services and new business models that drive growth and profits.
Connected insurance has given way to personalized premiums for auto insurance companies and their customers. A U.K.-based InsurTech company, Bought By Many, has been aggregating users with specific and personalized insurance needs, allowing insurers to offer them services at scale. This kind of service is reflective of what’s going on in the commercial insurance industry. Everything from data patterns to cloud-based applications are forming what it means to offer insurance to customers, helping to personalize an experience and create a more tailor-fit model of connected insurance.
Insurers have a unique level of access to rich datasets. Most insurance companies can be reluctant when it comes to revealing why they ask certain questions because it can reveal too much about how they price out their products based on data. But InsurTech companies have learned that customers trust them more when they show the benefits of providing such data for a more personalized experience.
Companies who caught on to this customer-centric ecosystem have changed their business models to give customers more control over their premiums. This enables the customer to acquire insurance when and where they need insurance and also enables insurers to reward customers based on their risk profile. This pay-as-you-go, pay-as-you-drive structure has been changing the auto insurance game with companies like Root and MetroMile popping up as disruptors.
This model is also becoming popular among health insurance providers, which rewards customers for living healthier lifestyles with lower premiums. They can do this by tracking behavior using wearable technologies, like with Oscar, a Google-backed InsurTech startup that rewards users for every step they take when they are being tracked using a wearable band. Other insurers are collecting data on heart rate and blood sugar levels for diabetics to adjust their risk profile while also providing coverage. This change in the ecosystem has made insurance companies lifestyle companies or essentially tech companies that offer insurance as a bonus.
Offering Perks
Gamification has made its way into every industry as mobile app usage has seen a sharp rise. User experience and user design show up in insurance companies’ assessments of customers by providing a progress bar to show how much longer the customer has until they are finished. It’s a small but simple way to include gamification into a process that’s usually seen as a nuisance.
Gamification can help to display information for customers more clearly so they choose the right product and service and get the lowest premium for it. This could include having them answer a few basic questions that apply to them the most. Plus, with pay-as-you-go, companies are offering perks and discounts when customers track their lifestyle habits and daily goals, hitting milestones and competing in a friendly way with others in their health community.
AI and UX Design
UX design has paved the way for a more streamlined approach to holding the attention of the customer and prospects. Companies like New York Life offer up an abundant knowledge base for customers looking to get information on the purpose of life insurance and what types of coverage they can purchase. The company has made it easier for first-time insurance buyers to sift through stacks of policies with dense information and get to the information they need on a simpler scale.
When it comes to artificial intelligence (AI), companies like Lemonade, offering renters and home insurance policies for homes, apartments, co-ops, and condos, are using AI bots who can help find the best coverage through web chat features. Plus, mobile apps are allowing customers to get insured in under 90 seconds and paid in three minutes. This is making insurance sexy as opposed to dealing with the long, drawn-out process of legalese that would turn customers away in the past.
InsurTech technology has created a pathway for mobile diagnosis and prescribing, like with Roman, a men’s health startup that allows men to find the service they need for things like erectile dysfunction and hair loss. While not an insurance company, Roman is mirroring a new wave of Teladoc services that most major companies are implementing now with 24/7 access to health care.
The future of insurance is ripe with opportunity for insurers who move beyond a product focus and look deeply into the goals and outcomes that are most important to their customers. Those who learn how to harness data, services, and devices in the digital ecosystems surrounding the insured by leveraging emerging technology and utilizing awesome UX to help customers understand, prevent, and manage risk will emerge as the future insurance leaders.
Emerging Distribution Strategies and Solutions: Competing in a Digital Customer-Centric Market
04/04/2019
Blog, Customer Engagement, Distribution Strategy, InsurTech
The insurance industry is rooted in tradition and has been consistently devoted to its tried and true processes. But with the advent of mobile devices, digital data and an analytics-based approach to working with, serving, and retaining the customer, insurance companies must embrace digitally-enabled distribution strategies or perish.
Digitally transformed insurance products, customer engagement, and processes are impacting everything from auto to life to home to commercial insurance. Personalized bundles are being developed to create streamlined offerings for customers. Leading insurance companies are coming to the understanding that they need to develop next-generation distribution strategies that can effectively sell and support these next-generation products if they are to remain at the forefront of the digital insurance industry.
But it’s not just the fact that the industry is changing, the customer and their expectations are changing as well. These changes are being driven by the customer’s experience they have within closely aligned industries such as banking, as well as, the experience offered by the big tech giants like Amazon, Google, and Apple. These expectations change the customer expectations about everything from where and how they are made aware of their needs and solutions that address them, to how they are onboarded, serviced, and supported as a customer to their expectations about how insurance-related solutions create value for them. Insurers will need to develop distribution strategies and capabilities that can address these needs by identifying new digital touch points in the ecosystems surrounding insureds, improving the flow of information between the customer, distribution partners, and the insurer’s various departments and processes. The ultimate objective is to deliver greater value, be faster in a more personalized manner, and do that far more effectively than current approaches. All of that will need to be executed through touchpoints and processes that span a myriad of digital ecosystems.
What’s Needed to Win: A Customer-First Strategy
Insurers, brokers, and agents that expect to survive and thrive must take the steps to understand the particular needs of both current and target customers and begin to build a strategy around them. Customers are already reliant on digital products and services at this point, and there’s no going back. They expect a fully personalized service meant to provide the easiest experience when inquiring about and applying for new insurance services. Expectations are high to receive the level of service and support they need that fits into their everyday personal and business lives.
And while customers are wanting to handle a lot of options on their own with self-service and tech, they still want the personal touch of an agent ready to help them when they need it. When it comes to more complex issues, customers would much rather speak with a live human who can make things simple for them.
That isn’t so different from what agents and brokers provided in the past. What is different is that in today’s world, the customer rightfully expects the person they reach to know far more about who they are, what their needs are, and where they currently are in their journey as a potential or existing customer when the person responding picks up the phone. They don’t want to repeat information and the last thing they want is for the person they speak with to be less informed about the topic and their situation than they are. The digital products, solutions, and broker and agent platforms that are emerging from the innovation being driven by InsurTechs use next-generation data sources, machine learning, and predictive analytics to provide automated insights and make connections to provide a more user-friendly experience. Within a few clicks and swipes, they enable agents and brokers to give customers completely personalized information based on the data that’s been provided previously.
This type of focus on service can help brokers and agents provide all kinds of new highly contextual support and value to the customer experience and will help them remain relevant in the digital market that is coming. Deploying these kinds of systems will help insurers preserve a critical source of new revenue and partnerships that help them build and retain loyal customers.
Setting Data Free: Supporting Next Generation Business and Distribution Models
Information has traditionally been siloed across the insurance industry. Brokerages, agents, underwriters, and claims management have all siloed this information behind legacy systems and legacy ways of thinking about the business. Companies who expect to survive break those silos apart and begin sharing that information based on its ability to provide greater value and support to the customer. Yes, the customer’s privacy still needs to be protected, but those who want to compete successfully will need to find ways to share the right information on a prospect or customer at the right time in real time. No one in insurance can expect to compete using the old ways of having to search through a number of actual paper files or departments and/or to call others who have to do the same to meet the customer’s needs. Digital sharing and protection of data is becoming a competitive weapon and is more streamlined than ever, reducing errors, and removing tedious manual tasks from day-to-day work.
Technology is changing at a rapid rate and isn’t going to let up anytime soon. This is where cloud-based solutions being introduced by InsurTechs have a huge advantage over legacy systems that are difficult to work with and upgrade. Platforms that are used today must be future-proof, designed to roll out automated updates in the years to come and keep from having issues with servicing customers.
Why the Sense of Urgency? The Future is Already Here
The change taking place in insurance is accelerating. Many of the leading insurers and InsurTechs have completed the work on the basic digital capabilities they need to compete. That means they are ready to undertake and deploy the systems and capabilities that will truly set them apart from their competitors and give them a running start against the big tech players that are circling even closer to the insurance market.
Customers are getting younger in the insurance market, and if they’re not getting younger, they’re still operating with a younger, more modern outlook. The future of insurance consists of lower rates, better service, and personalized counsel to grow off of. Brokers and agents need to have this understanding to meet the growing needs right now before they are left behind. This can be done by looking at how Millennials and Generation Y are operating since they are the ones driving the trend away from traditional models and toward a more digital-friendly landscape.
Customers want their information and digital insurance services supplied to them quickly and in a personalized way. But it’s the human touch that will never go away as customers also want to be able to get in touch with a human being who understands their needs when they want it. To do this, companies in the InsurTech market need to design a data-driven approach to the user experience and engagement models that keep everyone up to date on the modern customer’s needs.
This can be seen in the way people communicate with each other, such as the use of mobile devices, chatbots, and social media. Tech-savvy customers, especially Millennials, are entering their mid-career stage and are working with these technologies more and more in their everyday work tasks. Mobile devices, including phones and tablets, can get employees the information they need while on the go, heading into or out of the office or going from meeting to meeting.
Customers are increasingly putting the importance on the speed of service as well as the ability to tap into self-service options. The insurers and brokers / agents that emerge as leaders will have done the same.
Examples of companies bringing these capabilities to market include Bolt, who is providing a platform that enables insurers to quickly set up and provide new distribution channels, to Digital Fineprint that provides data to support commercial brokers and customers, to Certua, who is finding new ways for life insurance agents to create value for their customers.
Companies are starting to install more Saas (software as a service) technology in driving the new insurance process for customers. And data is playing a huge part in how insurance companies are working with their clients, enabling insurance companies to better understand their needs with a more analytical approach.
Come listen to topics like this and others from innovative industry leaders at InsurTech FUSION Summit on June 18 -19 in San Francisco.
Digital Engagement: The Empowerment of Insurance Customers & Communities
03/25/2019
Blog, Customer Engagement, InsurTech
It’s hard to look at any industry in today’s digitally connected world and spot something that isn’t being guided, influenced, or altered by technology. In today’s fast-paced economy of digital connectivity, it’s all about personalization and the push toward a more hands-on method of customer engagement, the business and communication strategy that connects an external stakeholder and a company through constant communication and the creation of value for the customer. Think about companies like Amazon, eBay, Apple—all stalwarts in the customer engagement community, bringing a hassle-free experience right to their fingertips and doorstep.
The same can now be said of leading insurance companies that rely on technology, or Insurtech, to deliver positive results and engage with customers in a more proactive, omnichannel way. In the world of on-demand and connected insurance offerings rapidly coming to market, a competitive customer experience will make all the difference. The most innovative of those are combining insurance with added value, added services, and benefits from ecosystems outside of insurance. These services will improve customer engagement and quality of product and require thinking through a totally new approach to the customer journey and the customer experience.
Redesigning Customer Expectations
First, it’s important to look at how tech companies that are unrelated to the insurance industry have changed the consumer experience from top to bottom. Tech giants, as alluded to above, have completely upended expectations that customers have in obtaining practically any product or service they need or want. By developing a truly digital and mobile experience, these tech companies have redefined a new customer engagement and experience standard. It’s results: instant gratification, immediate connectivity and a new set of expectations among the consumer base.
Companies like Apple and Netflix have not only changed what customers want and expect from their products and services but the entire customer experience. They are using, big data, social media, and artificial intelligence (AI), as well as other advanced technologies to more deeply understand the customer, anticipate their needs and recommend next steps. Insurance companies that don’t create digital-first strategies when looking to attract or retain customers will find themselves rapidly falling behind their more advanced competitors.
Consumers are also becoming more comfortable with trading their personal information for these more personalized faster and efficient experiences. Ease, convenience, and value across the customer journey are now king and are shaping connected and on-demand insurance which will become the new normal over the next few years. With data-driven insight and artificial intelligence, insurance companies that use this data and these technologies to anticipate and deliver personalized experiences and value their customers’ needs will emerge as the winners.
A New Thought Process
Customer engagement in the insurance sector is evolving thanks to InsurTech’s like Lemonade, with renters insurance or Ladder in life insurance or Next in Small Business Insurance. Even large carriers like John Hancock with their Vitality program are changing the game. The emerging paradigm changes the relationship between consumer, insurer, and increasingly the community surrounding the insured. New and innovative customer engagement paradigm starts by engaging the end insured through the ecosystems that surround them. Those include not only smart homes, smart cars, smart factories, and smart mobile devices but also the places online where users search for, purchase or use goods and services. This new engagement paradigm is moving insurance from a sterile relationship of premium payments and claims checks to a relationship in which insurance combined with other services helps the user more effectively achieve their life, health, and business goals.
Insurance companies are utilizing modern methods to work with the consumer and altering their entire business process to include forward-thinking on-demand insurance. Leading Insurance companies are investing time and effort to research to understand the touch points and services in the digital ecosystems surrounding their current and prospective customers.
Customer Engagement in Insurtech
With that information, leading insurers are now able to define new customer segments and risk pools: Information they are using to develop new products, new business models, and new engagement models. Customer engagement is now being leveraged by insurers in the on-demand insurance world through a digital-forward methodology. By combining big data, with social media engagement strategies these companies can now understand and provide personalized coverage and engagement models that align in real time with the customer’s life stage, style, and circumstance or activity.
The major impact of staying connected with customers through engagement has been the increase in retention ratio. Pleased customers help an insurance company get ahead of their competitors in the connected insurance industry because personalization has already been built out. This approach not only increases the loyalty and retention of customers it’s also increasing underwriting profits while at the same time reducing customer acquisition and support costs.
Looking Toward the Future
This is the perfect time for insurance companies to capitalize on the digital ecosystems and services surrounding customers to drive new revenue and profits through new customer engagement paradigms. Customers are looking for experiences and products in the insurance industry that meet their personalized needs and can keep them engaged with not only the company but the products and services that are being offered.
Digital generation customer engagement is the first move toward the completion of a digital transformation. As Insurer’s taking this step to find that it’s helping them develop a far more customer-centric strategy and even more importantly a customer-centric culture.
While insurance companies are seeing new threats and challenges coming from the digital ecosystems surrounding customers the leaders are also capitalizing on new opportunities to connect with customers and position themselves as leaders at the next frontier of the industry.
Come listen to topics like this and others from innovative industry leaders at InsurTech FUSION Summit on June 18 -19 in San Francisco.
The Value of Predicting Claims Litigation with Artificial Intelligence
03/20/2019
Blog, InsurTech, SVIA Contributors
The time-tested axiom in risk management: “If it’s predictable, it’s preventable,”¹ holds true today in the business of property and casualty insurance claims. What’s impressive is that we can take that axiom and energize it with artificial intelligence, machine learning, and natural language processing.
An On-Demand World: SMBs Demand On-Demand Insurance
03/06/2019
Blog, InsurTech, SVIA Contributors
The insurance industry has long struggled to effectively serve Small-Medium Business (SMB). The cumbersome and inefficient process of buying business insurance doesn’t suit the needs of SMB’s, nor does it suit the expense structure of insurers and brokers. Consequently, affordable and convenient insurance options for SMB’s are limited.
When reviewing the options for SMB’s, it seems most insurers are focused on coverage rather than convenience. It’s a natural instinct – coverage is what they do. But, do most customers really care if they have $150,000 of Valuable Papers coverage instead of $100,000? Coverage is not necessarily customer-centric.
Although there are a number of options now for SMB’s to buy insurance online, it’s not actually that much easier. There are still lengthy applications to complete, small underwriting “boxes” that delay quotes, complicated proposals to review, wait-times for policy documents and archaic payment options. The same cumbersome buying process has simply been moved to the digital world. Almost everything an SMB needs to operate can be purchased instantly. If a small contractor needs equipment for a job, the owner can simply drop by Home Depot on the way to the office. Likewise, if a consultant needs data to complete an analysis, a few minutes researching on Google will find numerous sources that sell data subscriptions. Time for lunch? Delivery can be arranged with practically every restaurant in the city.
So why can’t insurance be purchased the same way– instantly, as needed, and without any hassle?
On-demand insurance will do just that! In fact, the first product from Slice for SMB’s will be cyber insurance. It’s not just a policy, it’s a program. Even with insurance, claims cost money in terms of deductibles and lost time. The cyber product rolls together insurance and loss prevention to minimize “Total Cost of Risk.” The result: fewer claims, fewer deductibles, less time spent on insurance and lower premiums for SMB’s.
Key things to look for with “On-Demand” Insurance:
- A digital policy that can be purchased easily and instantly from a web or smartphone app
- Submitting and being paid for claims digitally through the same app
- You’re in control: buy it when you need it, keep it for as long you need it, and then cancel without penalty when you no longer need it
- The ability to reach underserved markets, such as SMB’s.
Here’s how easy it is to buy insurance through some very exciting innovations:
No Application Form
Here’s a secret: the application form can only benefit the insurer. It is not customer-friendly. Most of the information required on the form is either pointless or available from other sources. The purpose of the application is to get a signature to a warranty statement to use against the business at the time of a claim.
Subscription Service
Rather than being forced into an annual insurance policy with an inconvenient renewal cycle, SMB’s can subscribe to their required coverage month-to-month. No more renewal questionnaires and no more premium finance contracts and the interest fees that go with them. Plus, at any time, the SMB can buy additional coverage on a temporary basis to address specific needs. Then, cancel at any time without penalty.
A Simple Policy
Insurance policies are short and written in plain English. Confusing insurance terms and legalese are eliminated. Policies are easy to read, easy to understand and easy to buy.
On-Demand insurance will not only make getting insurance easier for SMBs, it will have a huge impact on the industry as a whole.
Get all of your insurtech news and insights on the SVIA Blog.
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