Insurers need to rethink their distribution models for a superior customer experience, maximum value and uninterrupted service, Capgemini and Efma’s World Insurance Report 2021 shows.
In the wake of the Covid-19 pandemic, the world has become more insurance conscious, and the adoption of digital channels is one way for the insurance industry to catch up.
According to this year’s report, more than 60% of insurance executives surveyed said that Covid has affected their firm’s customer acquisition efforts, and 40% cited an impact on customer retention.
The report suggests an approach called CARE, where convenience, advice and reach are at the heart of designing and evaluating the effectiveness of the channels.
A total 87% of insurers say they will invest in digital enhancements while just 32% say digital sales are effective in sales because they lack personalised advice capabilities.
Digital channels have a 24/7 availability and ease of updating information, but the lack of personalised advice made it clear that agents and brokers are still “essential” for insurance, the report says. Additionally, when it comes to personalised advice, customers trust brokers more than other channels, but digital limitations hinder this traditional channel from providing anytime, anywhere convenience.
A good customer experience is something everyone wants. And having easy access to information can affect that experience. Lockdowns and social distancing, however, have made it harder for the personal line customers, with more than 40% saying it was challenging to contact brokers outside of typical office hours.
However it is knowledge gaps that are possibly one of the biggest barriers to converting leads into sales more effectively.
Brokers need to know more about policyholders and potential customers, and artificial intelligence-based analytics could help them do that and answer questions and offer the most appropriate products.
The report adds that the most successful insurers will win and retain customers by reinventing their operating ecosystem to support a model based on a mix of physical presence and digital engagement.
Zurich Switzerland’s head of transformation and technology Sandra Hauser said: “Machines are very good at analysing big data, sifting through data lakes, and giving an adviser input. And humans are best at making a judgment call based on the situation. With seamless human-machine interaction, you can deliver the best solutions to customers.”
Capgemini’s financial services and group executive board member Anirban Bose added: “Today’s customers expect interacting with their insurers to be easy, and providers need to ensure their channels enable a convenient and seamless customer experience. By investing in the right technologies, insurers can win and retain customers while empowering their agents and brokers to deepen relationships.”