Article 24 Summary: Omni channel in Insurance

Article by BCG

Summary

The document discusses the success of implementing omni-channel sales in the insurance industry through collaboration between Income Insurance, BCG, and ZA Tech. It highlights increased lead-to-sale conversions and annualized premiums. Key components of a seamless omni-channel proposition, such as lead nurturing and interactive tools, are emphasized. The document also explores the omni-channel opportunity in digital banking, citing a bancassurance deal between ZA Bank and a global insurer. Challenges and recommendations for implementing omni-channel sales are provided.

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Insurers in Southeast Asia tap into major digital platforms with over two billion monthly users for lead generation. Customer preferences shift from digital to human interaction, with 65-70% switching channels, especially in the closing stages of decisions. While general insurance products integrate into partner ecosystems, life insurance, due to its complexity, sees less embedding. Challenges hinder full integration of omni-channel models, including organizational silos and outdated technology.?

The paper presents a successful omni-channel model for life insurance, launched by Income Insurance with BCG and ZA Tech in Singapore. The platform yielded positive results, including 19,000 qualified leads, a 10% lead-to-sale conversion rate, a 5% incremental annualized premium, and 62% new or reactivated customers. The project employed cross-functional teams and agile methodologies for iterative platform delivery and improvement.

The 5 key principles of a successful omni-channel journey are:

1. Seamless journeys without process repeats across any chosen channel

Research shows a wide variety of preferences in the way customers interact across various stages of the journey: self-service, online chats, (video) calls, and in-person meetings. Since preferences are fluid, a seamless continuity across channels and stages is paramount – data and context need to be carried over in real-time, ensuring that there is a seamless experience, without any process repeats.

2. Continuity of a serving “bionic” advisor End-to-end, trusted advisor-customer relationships happen in wealth management, and they should happen in insurance too. One single point of contact makes a big difference in customer-insurer relationships.

3. High-quality, pre-nurtured leads

Gently funnelling prospects toward making a decision on insurance requires more than a single digital post. Engaging them with more personalized media and campaigns, or directing them to landing pages all make it easier to nurture leads

4. Attractive hook products and propositions Entry-level hook products have proven to be an effective way of getting more prospects further along the journey. Affordable or freemium propositions are a good first step to lowering an entry barrier to an initial purchase.

5. Plug-and-play integration in partner platforms To become a preferred partner for ecosystem platforms, insurers need to focus on key elements:

• Clear User Benefits
• Seamless Customer Experience
• Attractive Economics
• "Zero-Effort" Integration

The building blocks of a seamless, high-output omni-channel proposition

Step 1: "Nurturing" in insurance involves cultivating prospects' interest before they become leads, including leaving contact details. Insurers can enhance digital engagement on partner platforms with tools like configurable components, lead generation engines, appointment booking, self-discovery tools, and smart matching engines for personalized services based on prospect characteristics and interests.

One of the examples for a self discovery engagement tool given in the article is the “People Like You” feature of Income Insurance App. This feature plays on both psychological and aspirational factors.?

• It first creates a sense of belonging in the minds of the users by putting them in similar cohorts of users.?
• It then gives them a benchmark of what peer parents are doing.?
• Then it prompts the parent to define their monthly budget?
• Finally showing them where they stand right now and how through the right guidance (as taken by other parents) they will be able to achieve their goals.

Step 2: Contacting & Warming - building a lead’s awareness of insurance after they’ve expressed intent to make an appointment, or have already signed up for a meeting.

Lead insights and digital footprint:

• The Advisor Portal, linked to a "Customer Data Platform" (CDP), supplies advisors with lead insights and a digital footprint.?
• It includes information from various channels, enabling auto-tagging and segmentation for distilled lead insights, empowering advisors with contextual information for initial meetings.

Pre-appointment personalized info-board:

• Advisors can use a digital tool in the Advisor Portal to create personalized webpages for prospects, bridging the gap between appointment booking and the meeting.?
• The info-board prepares clients with relevant content, showcasing advisor commitment and boosting engagement for smoother sales closures.

Lead reactivation via marketing automation:

• When leads turn cold due to various reasons, automated multi-stage marketing strategies can be employed to re-engage them.?
• Leveraging auto-tagging, segmentation, and scoring logics, these tools are effective in reactivating cold leads or previously churned customers who may have started the journey but dropped off.

Step 3: Meeting & Closure

Customer-centric KYC, needs analysis and conversational data capturing tools:?

• Integrated collaboration tools in the Advisor Portal enable advisors to conduct presale steps more conversationally, in settings preferred by customers, whether in-person or remote. Examples include live sketching, handwritten text recognition, pre-populated customer data via CDP integration, and automated retrieval of data from governmental websites.

Interactive, real-time product quotation tool:

• Integrated into the Advisor Portal, this tool enables easy product configuration for customer needs, offering automated recommendations, benefits visualization, and product comparison tools.

Cross-channel application and closing capabilities:

• A key step is ensuring customers can seamlessly complete applications across all channels, with data accessibility for supporting documents, signatures, payments, and real-time issuing capabilities.

Insurers commonly face challenges in integrating features for a seamless journey. While successes exist in individual aspects, achieving an end-to-end success story with widespread customer and advisor adoption is rare. Ensuring a seamless journey involves meticulous integration of solution logic, designs, tech solutions, and data pass-through. The next section will discuss strategies to prevent disconnected and poorly adopted omni-channel journeys.

Building an omni-channel journey as an insurer Cross-functional teaming

• Successful omni-channel sales implementation requires a cross-functional team breaking down silos and working collaboratively.?

• Key areas of expertise include leadership, product management, design, marketing, data analysis, engineering, distribution, and operations.?
• Transparency with clear business targets and shared KPIs is essential for team collaboration and motivation.

Agile, iterative design, build and run approach

• For faster impact, use a test and learn approach before full-scale implementation.?
• Conduct small-scale trials on select partner platforms, targeting diverse customer segments with onboarded advisors for testing. Once the model stabilizes, focus on scaling the entire journey while maintaining an iterative approach for ongoing innovation and optimization.

Modern, productized, open architecture technology

Insurers face challenges due to complex legacy systems and outdated processes. However, it's possible to implement omni-channel sales without major changes to existing core systems. Four key components enable this approach:

• Partner Interface: A flexible solution on ecosystem partner websites/apps for insurance offers, lead forms, appointment bookings, and chat/video calls.
• Customer Data Portal (CDP): Collects and unifies customer data, generates lead insights, pairs advisors with leads, and automates engagement opportunities.
• Advisor Portal: Provides advisors with lead insights, management tools, notifications, and sales functionalities optimized for customer collaboration.
• D2C Frontend: A customer-facing frontend with end-to-end digital sales capabilities, allowing customers to complete insurance deals independently or with advisor assistance.

These components can be integrated with legacy core systems using productized SaaS solutions and open architecture principles. Extensive custom builds should be avoided to prevent technical debt. Generative AI and large-language models (LLMs) can enhance the omni-channel experience by assisting advisors, enabling their training, and personalizing products based on customer data.?

The document then takes example of the partnership between ZA Bank and a global insurer in Hong Kong demonstrates innovative bancassurance opportunities. ZA Bank, the largest digital bank in Hong Kong, engages in online nurturing, online matching, offline conversion, and online closing to create a seamless sales model for complex life insurance products:

Online Nurturing: ZA Bank engages customers within their app, raising awareness and interest through interactive experiences and games, offering discounts and incentives.

Online Matching: An engine scores and matches advisors and customers, ensuring the best agent for the lead. Customers can book and manage appointments with the insurer's agents within the bank app.

Offline Conversion: Agents and customers interact outside the app (e.g., in-person or via WhatsApp) to conduct needs analysis and prepare quotations. Feedback on appointments can be provided within the bank app.

Online Closing: Once customers decide on a quotation, they confirm data transfer within the bank app, auto-populate application forms on the agent's device, and seamlessly make premium payments within the bank app.?

Establishing a successful omni-channel sales model involves addressing hidden obstacles:

• Economic Model: Finding a sustainable cost and incentivization model is crucial. It must balance IT and marketing costs while charging for additional new business value. Learning from successful partnerships is key.
• Change Process: Change management is often overlooked. Advisors need training and support to adapt to new tech and data tools that reshape their roles. Providing coaching and guides is essential.
• Service Model for Younger Customers: Engaging the digital generation requires a native online experience. This demographic has many options, lower brand loyalty, and resists traditional sales tactics. Implementing gamification and relationship-building, as demonstrated by SNACK by Income Insurance, can attract, convert, and retain younger customers.

Detailed PDF is attached here:

https://fintrest.substack.com/publish/post/141152899?back=%2Fpublish%2Fposts%2Fscheduled