How insurers can enter the era of customer-centricity

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How insurers can become customer-centric

The successful insurers will be those who become obsessed with understanding their customers.

The people, the homes and the businesses you protect are all changing. Technological advancements mean we can now command Alexa or Siri to write a shopping list by speaking to a box in the corner of the kitchen. Or talk to the delivery guy waiting on our doorstep from another continent. Although this innovation is visibly changing the way we live, the insights insurers need to adapt to that new way of life are hidden. They’re buried among the volumes of data consumers and businesses create.

To become truly customer-centric, insurers need to harness every source of data to piece together the patterns, needs and preferences that make us who we are. The successful insurers will be those who become obsessed with understanding their customers, and the risks they face, better than anyone else. There’s growing evidence of the need to take a new approach to insurance. But how do you go about doing it in practice?

Developing insightful customer relationships

While it’s true that, for many, contact with their insurer is limited to when it’s time to renew a policy or to make a claim, this pattern is changing. It’s all down to a social media-dependent generation that expects on-demand, adaptive services. This generation are ready to share their data with brands they trust, giving them the keys to unlock a more personalised, on-demand service. On a personal level, it means insurers can gain insight into the changing risk profile of an individual. In a commercial sense, IoT-enabled assets and workforces will create the same dynamic.

Insurers are ill-prepared for this new relationship. With valuable insight locked away in silos, insurers can’t consume and capitalise on new sources for streaming data or react to the insight those data sources provide. GDPR is also changing the landscape for the typical channels for supplementary data sources. Insurers will have to win customer trust and form a relationship that encourages individuals to share the data directly from the source, rather than rely on third parties for this insight. Competitive advantage will come to those insurers who think ahead and adapt to new data ecosystems as they continue to evolve.

Putting the customer at the centre of transformation

Not only is data held in silos, but operational teams are also fragmented. They’re organised around processes and products, not customers. Pricing, marketing, digital and claims teams seldom collaborate, resulting in each team having a different view of the customer and their needs, preferences and value. As customers expect an exceptional service – and they’re much more digitally savvy – they’re increasingly likely to voice their concerns across various platforms. If they’re not resolved immediately, the viral nature of complaints can damage brand perception and customer retention on a much bigger scale than losing just one customer.

The solution to these challenges won’t be found through the promise of artificial intelligence alone. Automating a point process or orchestrating a chatbot based on a limited understanding of the customer will certainly drive down cost and benefit your bottom line, but won’t deliver the value that customers want or expect.

Can insurers develop the capabilities needed to change their business from a short-term, reactive relationship to an eternal partnership with consumers and businesses? The data is certainly available. It can help insurers to provide the right amount of cover in an on-demand manner, with premiums that adapt to the risks we are willing to take. But although the data is available, to be of real value it has to be supported by a new approach to risk. One that provides preventive services to allow both the customer and the insurer to detect and avoid risks before they happen. It’s why the industry is shifting, making the move from insurers (services that deal with and protect a customer once an incident has occurred) to ensurers (services that safeguard people during an incident, or even prevent it from happening in the first place). It’s down to the innovators pushing the boundaries of analytics and the customer experience.

Can insurers develop the capabilities needed to change their business from a short-term, reactive relationship to an eternal partnership with consumers and businesses? #CustomerCentric #Insurance Click To Tweet

Preparing for the customer of 2020

Ultimately, the benefits of analytical advancements extend far beyond the points I’ve mentioned above, and they give us a real chance to change how customers see insurers. As we face a new breed of customer, it’s time to show that we recognise the individual lives behind the data. Not only that, but we react and enhance and protect those lives and businesses. It’s all about having the intelligence to do the right thing, at the right time, in the smoothest way possible. Because when we successfully apply advanced analytics in the real world, it’s a win-win for customers and insurers.

SAS is ready to support the industry and take on this challenge. Are you?

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About Author

Paul Ridge

Client Manager, SAS UK & Ireland

Paul Ridge, Banking & Insurance Specialist, SAS UK & Ireland, assists clients to maximise the value of data and analytics. He is an expert in helping them move through the analytics lifecycle at speed to deploy insight within their operational processes to change outcomes and to do this in a repeatable and governed process.

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