Customer awareness, engagement and conversion at the digital edge
06 Jul 2016
Remember the movie Back to the Future 2? Marty McFly and Doc? It was released in 1989. They went to the impossibly distant 2015. There they found, among other devices, hover boards, smart clothes, biometric payments for taxis and drones.
As it turned out, by 2015 we actually had these technologies either in place or in development. And we have invented many devices, like the smartphone, which the movie did not anticipate. If the past is a foreign country, well, 1989 looks distant from where we are now.
Yet, ask yourself this – has life insurance changed in any significant way since 1989? Not much. It is still largely distributed through face-to-face meetings and even the providers are largely the same. Fast forward another 25 years – will we still be saying the same thing? Will the world change while the insurance industry remains the same?
The digital edge
Life insurance will change. We are working and living in a moment that requires us to think, act and win at the digital edge. This place, the digital edge, has disrupted many industries already, and it is only a matter of time before digital significantly impacts insurance. Here are four aspects of how the digital edge will impact life insurance.
- Mobile technology: From alarm clocks to social platforms; from GPS location to step counting; a high-powered camera to shopping outlets. Your smartphone does so much more than a phone in 1989 and many consumers simply cannot live without it.
By directing and controlling so much of your life through your smartphone, it only makes sense that you would engage with your insurance provider in the same way. Insurance companies without a relevant and powerful mobile presence will be quickly left behind.
It is not just about digitizing a paper process. Mobile is changing how consumers interact with their insurer. Real time risk assessment and all-new user experiences will provide a platform for new policy design and dynamic pricing, all enabled by mobile. New insurance technology startups focused on delivering transformational mobile experiences will provide insurers with the ability to transform their business models and win at the digital edge.
- Social media: What's the best way to sell something? Be recommended by a friend or trusted acquaintance. That is what social media offers – an opportunity for companies to leverage word of mouth marketing by way of social media. Just as important for insurers, social media is increasingly the operating environment in which consumers interact. Some will search the web for what they need while others will do everything through Facebook. Plus, implementing the correct social media strategy will provide leads for business development. Most life insurance is sold around major life events, so be present when consumers get married, move into a new home or get a new job. Consumers use their smartphones to post these life events on their social media accounts. Be contextually relevant to win at the digital edge.
- Artificial intelligence: Artificial intelligence (AI) will be the experience that increasingly powers consumer engagements within the life insurance industry. For more than 100 years, agents have been the primary method of consumer engagement. In the future, when you have a question for your insurer, there's a good chance you will talk to a virtual agent – powered by AI – with the ability to answer your inquiries. Only the most difficult scenarios will require the help of an agent.
And it's not just about distribution. AI will increasingly form the basis of measuring risk. Algorithms will assess driving, health, and many other types of risk in real time. AI will play an important role in providing truly personalized, dynamic insurance coverage for consumers.
- Wearable technology: Whether you use a Fitbit, Apple Watch or another similar device, wearable technology is already harnessing health-related data that is being used by early adopter insurers to incorporate that data into the insurance products you buy. But what about new types of wearable technology? Will insurers be able to adapt product design and pricing, while providing a personalized and connected experience to consumers who are constantly connected to the internet through their wearable devices?
Insurers have the opportunity to partner and win at the digital edge if they are willing to act now. The alternative is a significant business risk. The risk of being left behind.
About the speaker
Gregory Bailey is Co-Founder & CEO of Denim. He spoke at the "Next Generation Insurance Customer: Bringing it to Life" which took place on 22-23 June 2016 at the Swiss Re Centre for Global Dialogue.Summary by Simon Woodward