By Swiss Reinsurance Company Ltd
- Data-driven insights enable real-time insurance transactions, value-added risk mitigation and prevention services across customers’ lifetimes
- With growing granularity of insights into customer behaviours, role of insurance is evolving from indemnification of losses to a broader consultative service on risk prevention and mitigation
- Emerging markets lead the way with mobile and multi-channel offerings extending the reach of insurance
Digital transformation empowers consumers to be more informed and independent than ever before, and equips insurers with the tools to cater to customers’ current and future needs. This leads to the development of new data-driven business models, impacting the entire insurance value chain, the latest sigma “Data-driven insurance: ready for the next frontier?“ says. While consumer-supplier touchpoints will become predominantly digital, human interaction will continue to play a role: through consumer feedback and analysis, insurers will be able to identify where in-person engagement is most effective. To date, insurers in emerging markets lead the way in optimising the potential offered by digitalisation, as in many of these markets, the starting point is digital rather than analogue.
The availability of internet-enabled devices and universal connectivity has changed consumer behaviours and expectations, particularly among younger generations. Empowered with digitally-facilitated information, consumers expect rapid access to information, transparency, and more personalised purchase experiences relevant to their lifestyles.
“As a result of digitalisation, insurers now have direct connection to their customers“, says Jeffrey Bohn, Chief Research & Innovation Officer at Swiss Re Institute. “With the availability of granular data, insurers can better segment customers enabling them to develop new tailored products & services, and refine existing ones in real time. This benefits customers and insurers alike.“
Mixing digital and targeted human touch
With the growing granularity of insights into customer behaviours, the role of insurance is evolving from indemnification of losses to a broader consultative service on risk prevention and mitigation covering both private and commercial clients’ changing needs over time. For example, digital data sources signal changes in an individual’s life circumstances such as marriage, a new home or job. In response, insurers can direct personalised guidance to the client on predictive and prescriptive next-step risk mitigation actions.
The direct relationship with customers will evolve as new touchpoints and channels become normalised, and back-office processes like marketing/sales, underwriting and claims administration are increasingly automated. To complement the efficiencies of digitalisation, insurers will be able to make most effective use of the insights and target human engagement to circumstances where consumers expect empathetic response, such as a health crisis or death in the family. The personal touch in sensitive areas will bring a human face to insurance.