A few weeks ago I attended InsureTech Connect 2017 in Las Vegas to see what the future of insurance holds.
I did my best to take in a broad spectrum of disruption coming to multiple lines of insurance (Property & Casualty, Health, Auto, Life) and see if there are some key things that unite the changes coming to each of them. Overall, from the sessions, the trade show, and the networking around the conference, I took away 3 key points.
Vision Is Great, But There’s Still A Need To Hit The Basics
Many of the talks and the keynotes focused on the massive changes that are about to hit the insurance industry, from AI to Blockchain to IoT. There was a lot of talk about how these areas can have a “transformative” impact on the industry. That being said, some of the more astute speakers noted that the industry as a whole is still failing to hit the basics. It doesn’t matter how good your AI is if your customer doesn’t understand what a deductible is. Basic concepts around policies, the need for policies, and what’s covered by policies are not well understood. This was a key, but maybe overlooked, point made by a lot of the different speakers.
I felt this point was made quite elegantly by Metromile CEO, Dan Preston, in his fireside chat. While a lot of his talk was focused on Metromile’s decision to become a full carrier, he also spoke about the time the company spent (4 years overall) trying to truly understand their customers’ needs. He told stories about personally selling insurance on the street (a bike path in Portland, to be exact) to improve the sign-up flow. He talked about the investment they put into compliance and hiring insurance experts to make sure they’re not missing something fundamental. It was this investment in ensuring effective communication between both parties (internally at their company and then with the customer) that has allowed them to create game-changing experiences like complete AI claims handling.
Hitting the basics and simplifying insurance gives you the internal knowledge and consumer trust to build compelling next gen systems. Without a strong foundation, any system you create – no matter what new trend you’re using – will fall flat.
Basics Create Great Value
Another key takeaway I had was that hitting the basics leads to some tremendous business results. It may not be as sexy as talking about blockchain, AI, or new data created from IoT devices, but in one case, streamlining sign-up flows actually led to record policy sales. Re-evaluating and streamlining underwriting questions was reported to have the greatest impact on individual carriers financial results. I saw this in talks on health insurance (both open market and group), life, and P&C.
We’ve seen this with our clients here at Intersect. In working with one of the leading Canadian insurance carriers, one of the major successes we had was in streamlining underwriting questions and providing context around why we needed the information. In solving these two issues, we were able to help them continue to beat sales records. This success has continued development on the product as we move to straight through processing.
The key takeaway for me was that even though I was at a conference talking about all of the great innovation coming from insurance, the greatest results were in creating basic policy understanding. The start-ups that presented focused on the basics, which allowed them to grow without an established brand. You too can look at your content touch points and ask yourself if you are clearly explaining what you’re selling to your customers. Can you improve your results by improving your communications?
Bundling With Other Life Services To Reduce Risk
The final trend I noticed was bundling insurance with other services to create greater value. I saw this with fitness bands and health insurance, but more impressively, I saw it with customized pet insurance that included other benefits. This product added insurance onto other customized products for your pet (including food and vitamins), ultimately turning your insurance into a kind of subscription box for your pet.
What I love about this idea is that it flips the way customers think about insurance on its head. It is now no longer just a product buy – you’re buying a part of a larger ecosystem of products in your life. Further, you can start to test and tune these products to find out which ones create a lower risk. You can begin to adjust the behaviors of your insured through the products you offer them. Bundling insurance with other great products people already use seems like a great way to increase engagement and grow your affinity with your customers.
The key takeaway here is to think about the other types of products that intersect with what you insure. How can you tie these together better? Is there a way you can use them to offer a more complete service? This is a great way to improve your customer experience, as well as your wallet share with your customer.