SME insurance gets personal

Jason Cham­bers, head of under­writ­ing trans­for­ma­tion, Avi­va

Glen Clarke, head of strat­e­gy and propo­si­tions, Allianz Insur­ance

Gio­van­ni Giu­liani, head of strat­e­gy, inno­va­tion and busi­ness devel­op­ment, Zurich Insur­ance Group

Chris Kay, head of sales UK, Instan­da

Joe Thel­well, chief exec­u­tive, Tow­er­gate Insur­ance Bro­kers

Simon Wel­ton, mar­ket head prop­er­ty and casu­al­ty, UK and Ire­land, Swiss Re

Why do we still need personalisation in insurance?

JC: As an indus­try, we love gener­ic prod­ucts and seg­ments. But what we’re look­ing to under­stand is inti­mate details about the busi­ness – what the cus­tomer is doing, how they’re doing it, the way they’re per­form­ing – because that way you can tai­lor and pro­vide a solu­tion that com­plete­ly fits the cus­tomer and the price com­plete­ly reflects what the cus­tomer is doing.

CK: Con­sumers are increas­ing­ly expect­ing tai­lored, per­son­alised, prod­ucts that fit their needs. Large dis­rup­tive play­ers and small­er niche play­ers are lead­ing the way on this, pro­vid­ing dig­i­talised, per­son­alised prod­ucts through seam­less cus­tomer jour­neys

Do the needs of small and medium-sized businesses differ greatly?

GC: When we talk about small and medi­um-sized enter­pris­es (SMEs), that’s a very, very broad church. We have quite a dif­fer­ent sit­u­a­tion from the micro sole-trad­er end of the mar­ket towards a larg­er SME that might have a cou­ple of hun­dred employ­ees and a mul­ti-mil­lion-pound turnover. So this is a com­plex envi­ron­ment in which to make sure you get the cus­tomer expe­ri­ence right.

How do you personalise products given those huge differences?

JC: Arti­fi­cial intel­li­gence, machine learn­ing, data sci­ence, ana­lyt­ics: all these enable us to sup­port the cus­tomer in the dig­i­tal jour­ney to make sure the choic­es they make, the val­ue for mon­ey and the sup­port they’re get­ting is right for them. What we don’t want to do is put our dig­i­tal and automa­tion ambi­tions at the cen­tre of our dis­tri­b­u­tion sole­ly for effi­cien­cies. It has to be the cus­tomer at the cen­tre. Sim­pli­fi­ca­tion is absolute­ly key.

GG: We sell prod­ucts that are very clear to us, but at times they may not be clear enough to the cus­tomer. So sell­ing few­er, more sim­ple and more mean­ing­ful prod­ucts would be a step for­ward. How­ev­er, sim­ple doesn’t mean we can­not offer tar­get­ed propo­si­tions. We can offer cus­tomised vari­a­tions of a prod­uct through dig­i­tal­i­sa­tion and inno­va­tion. It’s most impor­tant we offer a sim­ple prod­uct, that is both easy to under­stand for the cus­tomer and easy to man­age for the car­ri­er.

CK: Lega­cy sys­tems can hold insur­ers back because old­er, prod­uct-focused plat­forms are unable to devel­op cus­tomer-first propo­si­tions. But new, usu­al­ly no-code, plat­forms can. It means embrac­ing new­er dig­i­tal-first solu­tions which put the cus­tomer fi

Isn’t it counterintuitive to offer fewer, simpler products when you are trying to make products more personal?

GG: Sim­pler doesn’t mean less pow­er­ful or less sophis­ti­cat­ed. Actu­al­ly, I would argue sim­plic­i­ty is the most dif­fi­cult thing to achieve in any area.

GC: I agree. What a lot of SMEs, par­tic­u­lar­ly at the small­er end, are look­ing for is reas­sur­ance. They don’t nec­es­sar­i­ly want to be amazed by the com­plex­i­ty of your prod­ucts, but they do want the reas­sur­ance they have the right cov­er for the things that are crit­i­cal to their spe­cif­ic busi­ness.

Are firms collecting the right information to personalise products?

JT: We shouldn’t see this as cus­tomers buy­ing a sin­gu­lar prod­uct in a moment. We should start see­ing these as clients who need to be looked after for a longer peri­od of time. So some­times more open-end­ed, more qual­i­ta­tive ques­tions should be asked, to under­stand what is appro­pri­ate.

SW: Mod­ern con­sumers are a lot more com­fort­able with shar­ing their data, so I don’t think we need to be too shy of tak­ing data from cus­tomers and using it. The indus­try has looked back for 300 years and trend­ed data for­ward, but that isn’t going to work for new and emerg­ing risks. We have to go and get data from oth­er sources.

GC: Yes, obvi­ous­ly over the last few years we’ve seen an almost expo­nen­tial explo­sion in the amount of data avail­able in the mar­ket and it’s not nec­es­sar­i­ly sup­plied direct­ly by the client.

CK: Cur­rent­ly, con­sumers are required to input a great deal of infor­ma­tion and can still end up with an unper­son­alised prod­uct. Rather than col­lect­ing more, firms need to focus on col­lect­ing the right infor­ma­tion. They can only do that by embrac­ing emerg­ing tech­nol­o­gy, like data and arti­fi­cial intel­li­gence.

So is the future all digital?

JT: I think at the start of this pan­dem­ic, peo­ple believed it would be only a dig­i­tal world that re-emerged. I believe clients want options, they want to have the dig­i­tal choice, but also want a face-to-face choice.

CK: Insur­ance is a human indus­try and that shouldn’t dis­ap­pear. Dig­i­tal expe­ri­ences can actu­al­ly make things more human, by mak­ing the pur­chas­ing and claims process­es more respon­sive and straight­for­ward.

SW: When I first start­ed in the busi­ness, a boss said to me, “There’s real­ly only two things that mat­ter, peo­ple and mon­ey, and you can’t have a rela­tion­ship with mon­ey”. I’d say it has evolved a lit­tle bit now. Mon­ey and data can inform the deci­sions about risk, but you still need the peo­ple. You can auto­mate a lot of the process, but peo­ple are still a very valu­able part of this busi­ness because it’s based on trust.

JT: I think humans are the dif­fer­en­tia­tor in the future and dig­i­tal can com­ple­ment human inter­ac­tion. Insur­ance is prob­a­bly the most com­pli­cat­ed con­tract you will sign in your life with­out a solic­i­tor present. So we need to make sure we give real­ly appro­pri­ate advice and real­ly tai­lor the prod­uct.

What role will your people play in the years to come?

GG: Humans were not cre­at­ed to do repet­i­tive tasks all day. It’s bor­ing, it’s frus­trat­ing, it’s also waste­ful. Humans were cre­at­ed to nur­ture rela­tion­ships through social inter­ac­tions, to find cre­ative solu­tions to com­plex prob­lems, which machines are not able to do. But now we can deploy the right dig­i­tal resources, I would say the human per­son­al­i­sa­tion of the inter­ac­tion with cus­tomers will be even more impor­tant and will be what dif­fer­en­ti­ates us in the future.

JC: The win­ners will be peo­ple who get that and it’s a dif­fi­cult recipe. We need to be ambi­tious about get­ting the per­fect bal­ance between data, tech­nol­o­gy and human inter­ven­tion.

For more infor­ma­tion please vis­it instanda.com

Pro­mot­ed by Instan­da