Many insurers are just beginning to come to grips with the demands being placed on them by their customers. Consumers and businesses have become accustomed to interacting with providers of goods and services – like Amazon, Google, John Lewis – where they can expect a tailored experience, based on the intimate knowledge that those companies have of the customer’s habits, likes, dislikes and needs. Financial services organizations, and insurers in particular, have not prepared for the demands that these new-age consumers are now beginning to place on them.
At a conference earlier this year in Europe, we conducted a roundtable discussion over lunch with insurers from multiple countries and regions across the world. Comparing notes on how they work with their customers produced an expected range of current capabilities, with the Nordics – particularly Denmark – leading the way in the provision of an omnichannel, customer-focused engagement model. What was most interesting was that, although some countries are well behind in delivering this experience, the rapidity with which they are catching up is astounding.
As insurers come to grips with this reality, and the speed with which change is happening, numerous challenges begin to come into focus. The technologies used by consumers in their journey with the insurer are changing at a much greater pace than the core technologies that underpin the insurer’s operations. Past decisions to implement point solutions, which seemed prudent – or at least were expedient – at the time, now constrain many insurers to the point of paralysis. Enabling new distribution channels, launching tailored products to address the morphing segmentation of the customer base – for many, this is treading water at best.
Some insurers have come to grips with the need to transform their business to meet these challenges head-on. The commitment required, the investment, the risks, are not insignificant. It is very tempting to do that next expedient thing. Those who avoid that temptation, and truly transform their business culture, are embarking on what is often a huge task. We have seen first-hand the benefits which can be realized – and these stories show what can be done with the right commitment to business and technological innovation.
At the end of the day, what will drive all this by necessity is that the consumer is the owner of the relationship. More than ever, your customer is empowered to demand, and will expect, a level of service, a customer experience, that reflects their own special needs – which will not be the same tomorrow as they are today. Once again, the only constant is change. No once–and-done here.
A version of this post previously appeared in Insurance Times