SELLING INSURANCE ON THE INTERNET
THERE is nothing certain but the uncertain. These days, we can hardly keep up with all the macro and micro changes that are taking place at social, technological, economic, environmental and political level.
Everything is affected by the digital age, in particular the insurance industry. The digitisation of both our personal and professional lives has an enormous impact on how we perceive traditional risks like illness, car accidents, theft, and so on, which also brings along a completely new spectrum of potential risks: For instance, how does one insure a car that is shared by several people in the city? Do solar panels on the roofs of residential houses affect the fire insurance" How does one insure a business against cyber attacks?
Radical changes at economic, political and technological level are forcing the insurance industry to call everything into question and to go in search of innovation. On the one hand, as brokers have always acted as a link between the consumer and the insurance companies, they are perfectly placed to develop new initiatives and to maintain their critical position in the market.
On the other hand, being the middleman, Brokers, agents or middlemen feel pressure all around. The digital age has the potential to cut out insurance agents, brokers and simply middlemen. We shall look at the role of insurance brokers in the digital age. What is the future of the insurance broker for instance?
The driving force behind innovation in insurance, are people. In essence, every broker’s top priority is to: Reach out to as many potential customers as possible. Recruit new customers and retain existing customers. That is the only way to ensure growth. This is and will always remain the case. However, only those brokers who adapt their strategy to reality will manage to survive. And the reality looks like this: digital age customers require a new type of interaction with their broker: They emphasis on line focus. They do their own research. They trust the input of social connections and the media and desire a high degree of self service. On the other hand, the elderly clients expect human contact from the start. Trust input from their close circle and expect a paper based process. They expect major human commitment just prior to their final decision and throughout the course of the contract.
Customers who gravitate towards online experiences often prefer self-service interactions to dealing with a customer service representative. These customers expect a carrier’s digital experience to be streamlined and to provide clear answers to their questions; much in the same way they would expect an interaction with an on line retailer to be intuitive and informative.
When a carrier’s on line experience fails to provide the information the client is looking for, or the process to complete an interaction is too complicated, customers will often leave the carrier’s website and call or email a contact center, both of which are higher cost channels for the carrier to service.
How does a digital experience fail to meet customer expectations and drive a channel change? Visitors most often leave a website because it does not have the information they need, the language is unclear, an excessive number of steps are required to complete a task or the design of the site is not intuitive. Collectively, these poor experiences create “friction” that prevents customers from easily completing a self service interaction, potentially driving them to a competitor site to search for answers.
For customer interactions that are supported by insurance agents or financial advisors, digital tools are becoming increasingly useful. Thoughtfully designed, customer centric digital tools help the sales force more effectively communicate the benefits of comple[ products and services, and they streamline the end to end sales process; from illustration through application and policy issuance.
In addition, digital tools increase the speed of the transaction while also reducing cost and errors. Beyond interactions supported by the sales force, digital tools can be used by the operations staff to execute transactions, thus improving overall quality and execution times by streamlining the use of back office systems as well as enabling these employees to focus on higher value work.
Getting it right technology
companies, online retailers and certain financial services providers have led the way in developing innovative and customer friendly digital experiences that eliminate friction from the user experience. Customers expect the same intuitive and streamlined experience from their insurance carrier’s website as they do from their favorite app, search engine or online retailer.
One guiding principle of digital innovation is responsive design, wherein user interfaces are designed to adapt to the size and characteristics of a device’s screen. This optimisation of user experiences across device types lets companies prioritise content
and services that are relevant to customers, at the moment they need them. For example, users can view bills or pay premiums on the go using a smart phone, and they can enjoy a broader spectrum of capabilities viewing the same.
The shift toward responsive design has another benefit many companies have realised that their desNtop specific website interfaces, while continuing to offer more content, could also benefit from being streamlined, allowing clients to more quickly achieve the purpose of their visit. Not all online user experience improvements reTuire significant infrastructure investments. An initial low cost step could be to gain an understanding of what customers want and use most frequently and make that information readily accessible.
Often, getting the basics of design and messaging right can be just as important as understanding users’ needs. Legible fonts, clear language, effective layout, savvy use of space and ease of navigation result in a more streamlined online experience.
Opportunities abound to deliver digital innovation across the life assurance and annuity value chain, from policy purchase to claims payout. Many life carriers have not yet fully implemented or optimized digital experiences at the most critical stages of the insurance value chain.
An end to end digital insurance model would increase automation and reduce the resources needed during the policy application process. At the tail end, the opportunity to leverage digital technology during the claims process promises to speed up the payout of policy proceeds while enabling faster and more rigorous fraud detection practices.
Further more, the e-signature technology can greatly speed up, and simplify processes that require customers to sign a form or application. Customers across many industries have rapidly adapted to the technology, and regulators have established rules that facilitate acceptance of esignatures.
Digital signing also saves costs in postage, paper handling and storage, as no physical copy is required, and eliminates the need to verify that signatures have been affi[ed in all the reTuisite places on lengthy forms. E-signature technology has also transformed fraud detection and legal discovery by providing a digital trail.
A more positive online customer experience can have a significant impact on business, as one life assurance carrier discovered when examining user interactions with its online direct life application.
Digital technologies can transform and simplify policy issuance by harnessing e-delivery facilities to transmit all policy documentation, endorsements and disclosures. Insurers should resist a piecemeal approach to customer communications, using a series of unrelated technologies and processes, and instead aspire to create a common platform for all digital communications, including customer documents, correspondence, statements and billing. A comprehensive approach enables the efficient creation, compliance, delivery and receipt of the highest quality digital communications, along with core processing systems integration, audited worNflow and business insights.
Transforming customer service in insurance through digital innovation; Cross selling and digital analytics can provide a holistic and comprehensive view of the customer, creating opportunities to cross sell and up sell.
For instance, when a customer adds a new vehicle to an existing motor policy, sales representatives can use data analytics that combine internal and external sources of data to determine whether the customer owns a home, and accordingly offer a home owners policy and bundled discount. Look out for part IX.