The consumer behaviour is shifting, with consumers of all ages adopting a “millennial mindset”, forcing established insurers to digitise and draw upon partners if they wish to gain market share from bigtech entrants, according to a report.
The ‘World Insurance Report 2020’ by Capgemini and global non-profit organisation Efma, revealed that consumers were increasingly trusting their own research through various channels to source information and purchase insurance products themselves and they were also turning to non-traditional players such as bigtechs and product manufacturers for innovative, personalized offerings with enhanced customer experience.
According to the report, digital adoption was no longer a function of age; for those with access to the web and social media, researching and directly procuring insurance online has become mainstream across all generations, with Capgemini’s report showing that the number of Gen X and older customers were making daily online and mobile transactions such as shopping or bill payments has doubled, rose from 30% of Gen X and older respondents in 2018 to 64% in 2020.
Following this, to remain relevant, incumbent insurers would need to take action, by re-evaluating their portfolios and harnessing partnerships to become “inventive insurers”. And this would involve shaping existing products to meet fast-evolving customer needs and preferences.
The report also recommended that in order to remain relevant to customers, insurers would need to better connect with their policyholders by providing them with hyper-personalised and experience-led engagement which would mean insurers would need to offer the right products, at the right time and via the right channels.
At the same time, incumbent insurers would need to evolve quickly from one-size-fits-all products to offering experiences that aligned with policyholders’ specific and individual preferences. While bigtechs were gathering real-time data through voice assistants, wearables and other IoT devices, and interactive chatbots, only 38% of insurers captured data from real-time IoT devices and 33% mine data via natural language processing-based support systems, the report found.