According to Swiss Re Institute, demand for risk protection will continue growing steadily in the years ahead, and the insurance industry is poised to keep growing accordingly. The global insurance market is set to exceed $7 trillion in premiums for the first time in mid-2022 and grow 3.3% in inflation-adjusted terms in 2022 and 3.1% in 2023.
With demand already high, and increasing, the insurance industry must be ready to serve the market. To do that, it’s essential to understand what customers want – and how to deliver that experience most efficiently.
Rethinking the Customer Experience
Insurance agents and insurers spend lots of time and resources every year trying to understand the market. Most of this energy is spent on demographic information – age, marital status, driving history, employment, family, hobbies, owning or renting, etc. Of course, the better that agents and insurers understand their current and prospective client base, the better they can build and tailor products – even ones for niche segments – to serve everyone’s needs and capitalize on business opportunities that may come along.
By contrast, very little time and resources are spent understanding a customer’s insurance buying journey, or their communications preferences. This represents a massive opportunity for the industry – one that’s mostly untapped, yet keeps growing in parallel with demand for insurance products.
Several key questions are important to understanding a buying journey, such as:
- At what specific point(s) does a customer become likely to buy a product?
- How does that customer prefer to be communicated with, in terms of time of day, channel, medium, etc.?
- What words and phrases are most likely to resonate and influence them to take the next step in their buying path?
- How and when does the customer want to engage, test and experience the product?
- How often does the customer want to be engaged throughout the life of the policy?
- How can communications facilitate a two-way conversation and feedback loop, instead of just a one-way information push?
- How can insurance professionals ensure that each current and prospective customer receives timely, tailored communications throughout their buying journey so that they have the information they need to make a good decision and a positive brand/product experience to base their decision on?
The more that insurance agents and insurers can find answers to these questions, and implement processes and tools to help them engage with the customer, the better their chance of optimizing customer retention, service and top-line revenue.
Yet, until recently, insurers have been hamstrung on the customer engagement front by their technology infrastructures. In many cases, those systems are 20 to 30 years old, featuring applications that don’t interoperate particularly well on top of storage and bandwidth systems that haven’t enabled their business to scale well. As time has gone on, insurers have added layers of high-code applications, and these have complicated the overarching stability of the legacy core systems that support their services and products. They also have come with other side effects, including rigid and template-like communications, slower policy management and claim response times, compromised data security and more staff time spent managing it all instead of pursuing higher-value business activities.
See also: 8 Key Changes for Customer Experience
New Technology Enables Tailored Real-Time Customer Experience
Gartner, in its August 2021 report “Composable Commerce Must Be Adopted for the Future of Applications,” says that applications have evolved to better serve their owners. The report states, “to achieve flexibility in delivering experiences, modular packaged business capabilities (PBCs) are brought together to form composable digital commerce platforms that align to the future of applications.”
Today’s technology has led to the advent of composable applications: platforms and software with functional blocks that can be separated from the whole and then integrated with other applications or their parts to create new applications with the exact functionality and purpose their owners need.
In other words, these new applications have the flexibility and scalability to tie together the various aspects of an organization’s technology suite to accomplish specific objectives. They also can layer other important capabilities and features on top to make everything faster, more secure and more productive.
The way to improve the insurance customer experience, then, is to find or build the right composable application that fits with your unique technology infrastructure and enables each specific aspect of the experience you want to deliver automatically.
Take website forms. When a customer fills out a company form, it initiates a workflow that can make or break the entire customer experience. On the back end, if the process is a clunky, manual workflow that requires several action steps from one or several employees, such as reviewing the data, storing the information and scraping the customer information in the company’s system, there’s a good chance something will get missed. In the year of the “Great Resignation,” relying on one specific person to manage this workflow puts your organization at risk of losing track of several customers should that employee leave the business.
You can see how inefficient this type of workflow is and how the customer experience suffers, and it all began with one single form that was disconnected from other applications.
Understanding context for your customer and their journey is paramount. There are several keys to keep in mind:
- Procure and deploy an application that synthesizes data from across the entire business – a complete end-to-end solution.
- Include building blocks relating to sales, communications, operations or any business function that’s directly involved with your customers’ typical buying journey. Then use them to execute the programs you desire.
- Integrate artificial intelligence and analytics to help you predict when your customers and prospects are most likely to take certain actions or want specific products. Then set up and activate the systems needed to deliver through the right channels at the right times.
- The best applications will automate as much of the work involved with delivering a customer’s experience as possible. This will free you and your team up to work on other value-added initiatives for your business.
- Also, be sure to host your application in the cloud. This has emerged as the best practice for the back end of these applications, because it ensures continuous uptime, infinitely scalable bandwidth and storage capacity, the tightest security compliance and optimal overall efficiency.
There’s no doubt this is a highly complex process, but that doesn’t mean it has to be difficult. An entire industry category has materialized to help organizations map their customers’ buying journeys and find and build the right composable applications for their business. For instance, Agencymate has developed applications suited for the insurance space – and we’re always experimenting with new features and technology to add more value to our platform-as-a-service and software-as-a-service offerings.
See also: ITL FOCUS: Customer Experience
The adoption of artificial intelligence (AI), for example, has given insurance agencies a competitive advantage by making sense of the data-heavy world customers live in. AI has simplified the process of data analytics by providing context around the data – a critical part of mapping out the customer journey. So, when organizations ask the questions: “How and when does the customer want to engage, test and experience the product?” and “how often do they want to be engaged with,” AI and data analytics decipher that information within the context of that individual, giving insurance agents the necessary background to create a better experience.
We’re living and working in a time of great change in business and society. The insurance industry is no different, yet there are tremendous opportunities for insurance agencies and insurers to lead the way forward. In 2022 and beyond, they need to take advantage of new technologies to build more tailored products and customer journey experiences that individuals and businesses can use to protect themselves and their assets. If they can do so, they will position themselves well for success.