Earlier this year, Duck Creek Technologies conducted a global survey of 2,000 consumers to learn more about where strategic opportunities may lie for carriers in 2022.
While there were a number of findings that presented carriers and brokers in a positive light, it was clear that a large majority of consumers – when asked about their perception of insurance – were indifferent.
Indifferent is not negative. Indifferent can mean there is a chance for great opportunity.
Insurance… on demand.
Following the survey, 48% of respondents said they would find add-on products appealing, and 58% said that they would find insurance on demand appealing. These points are interesting and, along with a number of other findings from the survey, highlight how consumer attitudes toward insurance are changing rapidly. Are insurance policies supposed to be "set it and forget it"? Maybe not.
The on-demand finding is a result of consumer movement toward “what you want, when you want it” models. Of course, insurance is a lot more complex a scenario than your television, razor or coffee subscription. However, there is a large market opportunity for those organizations that can meet consumers where they are.
Examples of on demand insurance are being seen in auto – accelerated by changes to driving behavior around the pandemic – and travel, along with home and renters spaces, too. It is bubbling under the surface, and the carriers that most quickly and painlessly integrate the right data or IoT solutions into products and processes will win this migration.
On demand insurance (like usage-based insurance) cannot be achieved without data and information, and accuracy and transparency are paramount. Cars have telematics. Travel has records. This all must be documented, verified and then applied to a policy with the same swiftness a consumer would demand when updating any number of their other subscriptions.
One last thought on this topic: We also found through the survey that nearly one in two respondents would prefer to make any changes to their policy online or through an app. All of this combined really demonstrates that attitudes from consumer experiences in banking, retail, entertainment and so on have already infiltrated the world of insurance.
To engage, or not to engage.
It may be surprising, but 70% of respondents expressed feeling that their insurance company treats them as an individual. Go, insurance! And, to quote Duck Creek CEO Michael Jackowski, “For an industry that is often painted black, I hope this is heartening for carriers and brokers.” Data statistics like this prove that the move to digital or web-based engagement and insurance’s efforts to modernize in the digital age has not significantly dented how customers feel about the way they are treated (despite previous fears that it may have).
There are plenty of opportunities that on demand insurance can provide, but, from an engagement perspective, these opportunities are even greater than one might think. In the past, hearing from your carrier meant one of two things: renewal time or claim time. Admittedly, this has not been cause for too much excitement.
According to the survey, 32% of respondents, on average, never heard from their insurance provider on an annual basis when there was no claim against a policy. That is nearly one in every three people having zero engagement with their carrier outside of a claim. Are there other potential touchpoints with policyholders that carriers are missing out on? Most definitely.
And even from the claims side, we are still not getting it quite right. The majority of time a claim is filed, consumers need real support. It can be an emotional and financially frustrating time, and, often, the hardest part is the waiting game or the uncertainty of a claim status and resolution. In fact, 95% of respondents said they would like to hear more about the status of a claim.
The takeaway is that consumers need to see and hear more from carriers and brokers – whether it is a communication with critical information about a claim or to uncover potential opportunities to conduct further business. Carriers and brokers cannot have the answers if they do not ask the questions. Are there opportunities to bundle coverages? Can goods be added to an ongoing policy? Is the policyholder potentially dissatisfied prior to renewal time, and there is still adequate time to make a difference?
See also: How Carrier Tech Drives Agency Change
Buying preferences are a mixed bag.
To put a bow on the consumer experience bundle, the survey highlighted that insurance buying preferences are all over the place. Insurance lines vary so dramatically – in complexity, to coverage, to price, to times to fulfill claims and everything in between. Rather than a one-size-fits-all approach, insureds want more personalized purchasing options.
Here’s that mixed bag: One in four consumers made their purchase through brokers or third parties, 73% on average bought directly from a carrier, and 40% preferred to interact through a website. Many carriers are already recognizing these behavioral shifts and are maintaining multiple channels to engage consumers. But, this requires truly understanding your customer and knowing the persona of the buyer in question.
Carriers are turning to technology and solution providers to see how they can access the latest and greatest customer engagement tools. Think digital customer service, for example, where carriers can leverage real-time chat, cobrowsing, screen sharing, voice and video to find a middle ground with their consumers. Using AI-powered chatbots helps eliminate communication efficiencies, and e-signature helps ensure that the policy is signed, regardless of where it’s purchased. These personal touches create powerful interactions (at the times they are needed and desired most) by technology.
Where are we?
From research, to inquiry, to sale, to purchase and to service, great customer engagement opportunities await. Carriers that meet people, products or processes where they are will find success.
Carriers have proven they are resilient over the past couple of years. Now, they are also proving they are innovative. Three areas that carriers might want to consider looking into when undergoing this process: accelerating speed to market, maximizing operational efficiency and growing distribution channels.
All three of these areas will enable carriers to expand their reach, meet current demand and optimize resources to ensure the desired customer experience is achieved.
Keep an eye out for this space. It is ripe for disruption – and carriers know it