Insurtech: There Is Window Of Opportunity For Insurers To Improve CX
Brad Lindemann, MBA
Global CX Strategy & Digital Business Transformation / Serving Customer Centric Organizations / Front-Middle-Back Office Solutions; Digital, AI, CX, VOC, Care, Lead Gen, Sales, Service, Retention, Loyalty
Insurtech: There Is Window Of Opportunity For Insurers To Improve CX
The last major shake-up in the insurance industry was the introduction of price comparison websites in the 1990s, but the current growth of Insurtech will be far more significant. This is because the present wave of innovation in the insurance market is entirely focused around the introduction of customer-centric services that finally deliver an insurance service that customers really appreciate.
Customers today are highly connected and demand immediate information and the immediate availability of insurance products. Five years ago the term ‘FinTech’ - meaning Financial Technology - was hardly used by anyone. Now it’s a popular search term on Google.
Many FinTech observers have focused their attention on retail banking rather than insurance - many FinTech startups have been challenging existing banks by delivering banking services that are app-based and focus on the customer experience. But Insurtech is happening alongside the changes in banking. The app-based property insurance service Lemonadeis a great example. Lemonade describe their own service as ‘instant everything’. The company takes pride in making claim payments in seconds. If you file a claim to say that your house was broken into and a laptop computer was stolen then their algorithm will verify your claim and pay you in about 3 seconds - assuming the system finds nothing suspicious with your claim. Try getting a traditional insurance company to pay out in 3 seconds.
PwC research suggeststhat 74% of the big insurance companies are already aware of the potential challenge from new technologies. However, only 43% of those companies are putting this innovation at the heart of their business and only 28% are exploring partnerships with innovative startups. So the big companies have a large customer base, but it doesn’t sound like they are all exploring how to reposition their insurance products so they meet the more demanding expectations of modern customers.
Most people already have an opinion about the process of claiming insurance. Asking friends to recount their insurance experience can feel like asking for their favorite horror stories. The bureaucratic claim process and poor customer experience are repeated time and again. It’s a common opinion that traditionally, most insurance companies have not made the customer experience a priority.
That’s why I believe there is a unique market opportunity in Insurtech at present. Look at the PwC research - fewer than half of insurers are making this a priority and only a quarter are exploring partnerships with Insurtech experts. Companies that want to succeed in insurance in the twenty-first century are going to have to put the customer experience first and there is a window of opportunity for those who can pivot in this direction.
Are you exploring the opportunities to improve insurance CX with Insurtech? Leave a comment here or get in touch via my LinkedIn profile and take a look at this Insurtech event in Las Vegas next October- let me know if you intend to be there.
- bradtlindemann.wordpress.com/About (Don't Sweat the Small Stuff !!)
Brad, this is so true. In my experience, insurance companies are really starting to turn the corner in realizing how customer experience expectations are no longer based on other traditional insurers but on disruptors and experience leaders in other industries. Insurers who don't take advantage of best practices in customer experience management (including partnerships with CX industry leaders) are increasingly being left in the dust in industry rankings.