Modern Insurance Magazine Issue 62

INSURTECH
Customer First
– It’s a Real Thing
The future is all about the customer. Customer-first strategies
can provide long-term growth, so customer signals must shape
business strategies. What signals are we seeing today? From COVID
to historic inflation, severe weather events and the rising cost of
insurance, customers are enduring an ongoing string of challenges
that have shaken their sense of financial security in how they can
protect their homes, cars, life, physical and financial well-being.
Denise Garth,
Chief Strategy Officer, Majesco
While insurance’s traditional products have and will always
be pivotal in creating peace of mind for the customer, new
and expanding risks, customer behaviours and expectations
require new ideas and approaches. Today’s customer judges
the insurance experience on an entirely different scale.
The rise of individualisation and personalisation is rewriting
the customer experience and the insurance process - from
the products offered and their pricing and underwriting, to
the channels recommended and the value-added services
provided. Customers are seeking simple, humanised
experiences that require a shift from a product-centric
approach to a customer-centric one.
Today’s customers are living different lifestyles and possess
far greater digital proficiency than ever. They demand
different experiences and have different expectations about
value. They want a risk product, value-added services, and
an experience that provides them with what they need to
manage their lives. Plus, they need financial wellness that
humanises the entire customer lifecycle.
But for many customers, there is a gap between what they
expect, want, and need, versus what insurers are delivering.
This gap influences long-term customer growth, value, and
loyalty. It demands a customer-centric strategy.
The customer expectation gap is most prevalent with
Millennials and Gen Z, who are not satisfied with traditional
insurance products, processes and business models. This was
demonstrated in Majesco’s consumer and SMB research. As
digital natives, they expect and demand digital capabilities
and products that will align to their activities and behaviours,
personalised to them. Even the older generations are
becoming digitally-savvy, and they have similar expectations
for service!
The implication is that traditional product-oriented strategies
developed from an inside perspective handicap insurers.
Savvy, innovative companies are redefining insurance from
an outside-in perspective, adapting to what customers
want and expect despite their generational demographic.
They are methodically peeling away generations of insideout
perspectives and operations that require customers to
conform to the way insurance works. Their innovative teams
are transforming insurance from a mysterious, confusing,
and difficult ordeal most would rather avoid, to a more
transparent, simple, and engaging experience.
How are insurers humanising insurance? They are offering
niche, personalised products, services, and experiences that
align with a customer’s specific risk needs. They do this by
using unique risk, lifestyle, and behaviour data.
Customer-first products also support the rising demand for
financial wellness. Since insurance is a vital tool for protecting
the financial security of individuals and businesses, additional
services that enhance this protection should be a good fit for
insurers to offer to customers, regardless of the specific lines
of business they offer.
Companies that offer and integrate their products and
value-added services into this financial wellness approach
can put themselves in a strong position and gain loyalty.
More importantly, these companies can gain a competitive
advantage over those that place their products and services
as a single or siloed item, instead of a vital piece of a much
broader financial wellness puzzle.
The advent of Consumer Duty embraces the customercentric
approach. It encourages insurers to showcase
their products in terms of value to the customer, helping
customers to achieve financial wellness and understanding to
the overall benefit of everyone.
There is no turning back. The future is here.
Game on!
MODERN INSURANCE | 71