The Future of Insurance Is Digital – But Don’t Leave Your Customers Behind

In the race to head off competition from InsurTechs and deliver sophisticated digital experiences, insurers must ensure they continue to meet the needs of different customer groups.

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Today’s businesses see the customer experience as key to successfully competing in the marketplace. For insurers this has meant major investments in digital transformation, with an eye toward streamlining business processes and delivering the seamless, personalized experiences consumers have come to expect across many industries.

Research reveals a growing consumer appetite for greater digital engagement on the part of their insurers, with a survey conducted by PwC finding that at least two-thirds would be interested in downloading and using an app from their insurance provider and allow them to place sensors in their cars or homes if it resulted in reduced premiums.

Amid the COVID-19 pandemic, which has accelerated the shift to digital life and commerce, nine out of 10 consumers now prefer to interact with their insurer digitally, rather than face-to-face. After a year of shopping, working, learning, and socializing online, consumers’ baseline expectations for readily accessible, friction-free digital experiences will remain high, even as the pandemic fades.

But while robust digital capabilities are critical to the future of the insurance industry and its ability to meet customers where they buy, it’s also vital for insurers to tailor the customer experience to the diverse needs and expectations of different demographics.

Case in point: Older policyholders, who expect a fundamentally different level of service than, say, millennial digital natives.

In the race to head off competition from InsurTechs and deliver sophisticated digital experiences, insurers must ensure they don’t leave any customers behind. Here’s what insurers should bear in mind.

When One Size Doesn’t Fit All

As anyone with just a basic familiarity of trends in customer experience knows, personalization is increasingly central to how businesses conduct outreach, customize offers, and keep customers engaged. At the core of the personalization trend is the undeniable truth that what works for one customer won’t necessarily work for another, and the customer experience must be calibrated according to each customer’s profile.

For insurers, this will mean continuing to offer analogue experiences for older customers with less affinity for newfangled technology. Completely digitizing customer processes for life and pensions, for example, risks alienating the very customers who are most likely to buy these products.

While this doesn’t mean that insurers should de-emphasize investments in technology and digital transformation, it does serve as a reminder that not all “legacy” processes and channels should be discarded. How, then, can providers strike the right balance?

What Insurers Should Do

To know which channels and aspects of the customer experience to prioritize, insurers should harness data analytics to pinpoint key demographic trends, better understand the pain points customers may be encountering, and help guide decisions on how to invest sales, marketing, and customer service resources.

Customer outreach and survey data can help reveal the core drivers behind customers’ decisions. By understanding what motivates them to select and stick with an insurer, providers can deliver a level of service that meets the needs of all policyholders. These insights can also inform insurers’ decisions about which products, processes, and new offerings to prioritize in their digital transformation efforts.

Retaining legacy features like live, over-the-phone assistance and customer service, combined with easy-to-use chatbots, can help ensure that all customers feel valued and supported – which is, as it happens, one of the primary goals of digital transformation. Meanwhile, having representatives call older customers annually to discuss policy updates and to check in on their overall satisfaction can be an effective way of keeping all customers – even the less plugged-in – in the loop.

Of course, if one size does not fit all customers as even many in older age groups are in fact quite comfortable with digital technology. From digital health tools to web conferencing platforms like Zoom, many older people – even those who were slow to embrace such tools before – have adapted their behavior and increased their tech adoption during the COVID-19 pandemic. Their needs, as well as those of their more traditional counterparts, deserve careful analysis and attention.

With a strong digital core and data-driven customer insights, insurers can deliver convenient, personalized, and relevant experiences to customers of all ages and levels of digital-savviness.

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Stuart Hayman // Stuart Hayman is successful Life and Pensions Executive with over 30 years experience in the life and pensions industry gained from a manufacturing and outsourcing background with Tier 1 Insurance companies and providers. His roles have covered operational, IT, organizational, process and solution design and delivery to both internal and external customers. His most recent roles have focussed on Sales and business development, new contract negotiation, and solution design. Haymans solution design roles have involved working with numerous clients, gaining an understanding of their strategic intent, providing guidance and presenting and delivering IT and business solutions based on extensive professional market experience.

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