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The insurance industry has undergone a period of extensive change in recent years. In fact, business owners respondents to a McKinsey study reported that the COVID-19 pandemic had accelerated their digital transformation agendas by seven years. Despite this positive step, customer expectations for digital services continue to evolve, requiring the insurance industry to adopt a comprehensive shift towards digital-first, agile services.
Customer expectations for digitization are often set by the leading tech giants. But, as technology and trends are constantly changing, knowing what to prioritize can be difficult. Ultimately, insurers need to place the customer at the heart of everything they do, developing a digital strategy for both front and back-office operations to meet customers where they are. Here are four key areas to address:
- Utilize data to personalize offers
The world today is truly connected. The rise of the Internet of Things has provided us with seemingly endless data about our everyday lives as we connect our phones with smartwatches, speakers and more. A study from Accenture found that customers were willing to share this data with insurers in exchange for personalized pricing, offers and discounts; 69 percent of customers surveyed admitted they would share significant personal data about their health, exercise and driving habits with insurers in order to access lower prices.
The incentive is the most important point here however, as the same report noted that customers were not willing to part with their data if there was no reward. This highlights the importance of protecting customer data by incorporating reliable security measures into your digital strategy to make sure personal information is kept safe.
- Make things easy by embedding insurance
The opportunities presented by embedded insurance are vast, with one study predicting the market will be worth more than $722 billion in Gross Written Premium by 2030. Beyond the obvious potential financial benefits to insurance companies, embedded insurance is fantastic news for the customer experience. Using technology, insurance purchasing is seamlessly integrated into existing online buying systems and uses the data the customer has already entered to present them with tailored insurance covers at point of sale. Common uses include offering flight delay insurance at booking, or device cover with the purchase of a new gadget, but the possibilities are essentially endless. With the portfolio of available covers growing all the time, this is not a trend to be missing out on.
- Put UX design for mobile ahead of desktop
There are many opportunities for potential clients to digitally interact with your brand and website. This is particularly true when you consider that a large number of people now have both a smartphone and a laptop or desktop computer. While this can make it challenging to know what to prioritize when it comes to site optimization, the current trend suggests that people tend to prefer using their mobile over their computer. One study from earlier this year found that mobile usage is now at 55 percent of the global market, with desktop use lagging behind at 42 percent, strongly suggesting that you should ensure your UX design is optimized, user-friendly and intuitive for mobile users.
This strategy will help future proof your company too. IBM found that 75 percent of Gen Z would pick their smartphone as their device of choice. As these will be your future customers, getting ahead and designing for them now will ensure you don’t miss out on this key market sector in the coming years.
- Enhance business operations with new technologies
While the benefits of digitization for customers are clear, enhancing back-office functions with new technologies can provide a whole host of benefits for your business operations too. Systems that are supported by artificial intelligence (AI) and machine learning (ML) can be easily implemented to streamline existing processes, finding data across multiple databases quickly while intuitively linking up disparate systems. Alongside this, AI powered chatbots can be deployed onto websites to help answer customer queries, freeing up staff time to focus on value-adding tasks.
However, there is a balance to be struck and it’s important to have staff on hand to help customers when technology can’t. New technologies are not intended to replace a human workforce, instead they are most effective when used to optimize day-to-day processes. An additional benefit of incorporating more technology into business operations is increased cost savings, which can in turn be passed on to the customer, increasing retention rates, loyalty, and their all-important peace of mind.
Insurance businesses still have a lot to do when it comes to meeting customer demand for digital services. However, the latest developments and customer expectations present the industry with an ideal opportunity to provide exceptional levels of customer service while focusing on digital initiatives. While technological trends are constantly evolving, businesses which place customers at the heart of their digital strategies, favor an agile approach and make the most of data-driven insights will keep pace with their customers, securing their loyalty and ensuring longevity.