Insurers have accelerated their digitalization tremendously over the past two years. They now need to build on this to strengthen their offerings and relationships with existing customers while attracting new ones.
1. Personalization Is Essential
In recent years, customers’ expectations for individualized experiences have dramatically increased. This also holds true for the insurance industry. Personalization, however, refers to more than just individual risk assessment. Additionally, it implies that specifics like the frequency of installment payments or the insurance company’s coverage of claims be adjusted to the requirements of the insured. To provide customized offers to policyholders, insurers must rely even more heavily on new technologies and data, from personalization engines and predictive analytics to telematics and sensor data.
2. Make the Most of Data
Speaking of data, insurers need a better understanding of what is collected where, what is useful, and how to utilize it to its fullest extent. However, many insurers’ data assets are significantly fragmented as a result of the gradual transition from paper to digital documents and separately operating divisions. For instance, data pertaining to a given task can only be used to populate a specialized data warehouse. In order to adopt the proper data platforms and data processing tools, businesses must restructure their enterprise-wide data model.
3. Develop Where Required
The majority of the time, insurers use third-party software. There is nothing wrong with it, however, these options are open to all rivals and only cover 80% of the use cases. Differentiation is therefore quite difficult. Because of this, an increasing number of insurers are choosing to (further) develop specific parts of their applications on their own, for example, to provide consumers with new features and set themselves apart from the competition. The IT infrastructure can gradually develop and modernize as a result of small-scale digitization. For these duties, long-term, strategic collaboration with a technology business that is familiar with the sector, the insurer, the complicated software environment, and delivers the necessary experience and development capacity is especially well-suited.
4. Transparency Builds Trust
Many people have a tendency to view purchasing insurance as a necessary evil since, in the event of a claim, the insurer will use the fine print to pay out as little money as possible. Anyone looking to grow their business, even with current clients, should make an effort to change this negative perception and establish themselves as a trustworthy partner: a transparent policy that is clearly communicated fosters trust because it lets clients know what kind of services to anticipate. However, because they are intrinsically complex, these insurance policies are frequently simpler to say than to implement. As a result, insurers should consider how to make their products simpler and how this may be represented in their recommendations and policies.
5. Making Claims Easier
Making claims is frequently the next hurdle policyholders must overcome in the case of harm. Depending on the damage, this process can be time-consuming and nerve-wracking in a situation that may already be stressful. Therefore, insurance firms should simplify the procedure as much as possible by allowing online submissions using simple forms. If specific circumstances are met, they can also establish automated payouts. For instance, when flooding exceeds a specific water level, this may occur in the case of flood insurance.