Include Not Exclude! The Mission Of Insurance

Insurance is a mission-driven business. This simple fact sometimes is hard to be believe…especially when you read the list of exclusions stretched from here to infinity in typical terms and conditions. But the role of insurance has always been simple: to be there for people and help people when they need it most. To be a helping hand when other hands are helpless.

In the world facing unprecedented events like wars, pandemics, natural catastrophes, global financial crises, cost of living crisis, this role of insurance has never been more important than today. As new risks emerge, there is a growing gap between these risks and the coverage in place to mitigate them — it is the protection gap. Our duty as industry is to close this gap. When abnormal events are becoming new normal it is an urgent call for the insurance industry to rewrite insurance from the beginning and start to include what was excluded so far!

Mission impossible, you may say. Luckily, the modern world offers many powerful means, including data and technology, which allow to unleash creativity, innovate, and apply the following strategies which help to reinvent insurance.

Go Digital!

Accessibility is key to closing the protection gap.?In the world where many people live their lives and do business online, how can insurance be more accessible than digitally? We order our meals online, we pick up taxi via an app, we apply for banking credits via mobile, we even see a doctor without leaving the house. Today’s consumers are hungry for digital experiences and solutions and insurance providers need to respond to this demand. By pivoting to digital sales, insurance providers can reach a much broader audience of potential buyers, at lower costs and higher margins because many customers are willing to pay more for a policy from a company that offers a user-friendly digital experience.

Include Small to Become Big!

As risks like climate change, wars, pandemics, financial crises persist, and new risks emerge, providing comprehensive coverage can be impossible. This is where “inclusive insurance” comes into play. Instead of providing traditional full-fledged and expensive policies why not to come up with microinsurance products that protect your customers in their millions of trips, transactions, and finger moves made on mobile screens every day. In this way insurers can capture underinsured markets and bring affordable products to those who need insurance most. Reaching those underserved markets can be a huge turning point for insurance business - and peoples’ lives.?

Personalize!

The times when one size offer fits all are gone! If something fits all, it fits none. Personalized coverage makes insurance more relevant to a given customer. If a client feels you are speaking directly to his specific needs, he will be more likely to purchase. The best way to guarantee personalized coverage is through the effective use of data and technology. Consumers would willingly share personal data to get lower insurance premiums. Insurance providers should use this to their advantage. Instead of chasing clients with standardized broad-range packages, insurers should use personal data to design a dedicated coverage that is right for a given customer.

Come Together!

Closing the protection gap is hard when you are alone. Partnering with companies from other industries like banks, automotives, retailers, digital platforms, etc., gives much more opportunities. “Embedded insurance” in a new name of the game which offers a lucrative opportunity for all stakeholders in the insurance value chain. End-consumers seamlessly get a highly relevant offer at the right place and the right time. Insurers make their acquisition costs low and customer reach high. Partners leverage the data they already own to generate new lines of revenue. With embedded insurance, nobody needs much additional incentive because everyone wins!

By applying those strategies insurers can finally stop a historically long practice of excluding specific markets, customer segments, or events which statistically represent higher risk profiles. Instead of protecting themselves against excessive loss ratios, insurers can now focus on protecting people without any exemptions. Instead of pleasing agents and brokers they can embrace digital channels and start truly please end-customers. And this customer-centric mission can go hand in hand with commercial goals. Even more, focusing on the inclusivity and entering untapped markets can be for insurers a smart strategy of gaining long-term competitive advantage.