This is the world that we live in

13 November 2018 Jonathan Faurie

The insurance industry is entering into a period which promises to rock the very foundations of the industry as we know it.

Clients are no longer satisfied with blanket offerings, they want immediate responses to their queries and are not opposed to engaging with their brokers over social media channels where they feel that they are engaging in a safe space. Big data is also playing a pivotal role in the industry. 

How does the insurance industry adapt to this? FAnews spoke to a few representatives from Discovery to find out what this future looks like. 

Trust is key

Designing the right insurance product that suits a client’s need is the sole reason why the insurance industry exists. A lot of this hinges on an element of trust that clients give their brokers during interactions. 

This was easy to achieve in the past because a client trusted the advice given to them on face value. Technology has changed this; it is now possible for clients to log onto the internet and familiarise themselves with the products that they would like to purchase without even engaging with their broker. 

This is having a significant impact on the insurance industry. “With the rise of the knowledge economy, and with consumers being able to easily research and compare products online, ensuring that products deliver the best value to clients through comprehensive benefits and at a competitive premium is essential,” said Gareth Friedlander, Head of R&D Discovery Life. 

He added that it is not just about creating a one-size-fits-all product, it’s about developing products and benefits that truly meet our individual client needs through a range of customisable products and benefits. Insurers are increasingly making sure that their products incorporate the latest technologies that not only create a seamless client experience but that also deliver real value through enhanced protection. 

“In today’s world, where technology has made information readily available and creates increased transparency for clients, it’s critical to provide clients with a unique competitive value proposition. If insurers don’t achieve this; clients are able to shop around and find better value elsewhere more easily than ever before,” said Friedlander. 

The new gatekeeper

When clients (or potential clients) interact with insurers and brokers over an online platform, they leave behind breadcrumbs of data which insurers can use to refine their products and gain unparalleled insights into the behaviour of certain clients. 

This needs to come with a certain measure of security as cyber criminals are rubbing their hands to get hold of this data. This has made the role of the Chief Information Officer (CIO) an important role. 

“Digital technology is about considering the experience of the ultimate end user of the products that an insurer offers. This requires a partnership between insurers, intermediaries and clients. The technology must enable each of these three parties to interact with the other in a way that is simple and easy to use. To make this a reality, the CIO role changes from building back office systems to facilitating excellent digital experiences. This requires far greater focus on relationships and on brokering solutions, both internally and externally,” said Derek Wilcocks, CIO Discovery Group. 

An important undertaking

Data is becoming key to the continued success and sustainability of the financial services industry. Various insurers have included telematics as part of their product offerings. 

This allows them to not only calculate their risk in a more accurate manner, but it allows them to gain insights into the behaviour of clients that can help insurers manage their risk more efficiently.

However, it is all very well having this data, how do insurers turn that data into a valuable part of their business? 

“To facilitate a digital experience, clients must trust insurers and intermediaries. This requires utmost care in the capture and use of data by all parties. Data is increasingly being used to make decisions around underwriting, which requires high confidence in data accuracy and lineage,” said Wilcocks.   

He added that, in the future, this capability will grow to the use of data to facilitate highly personalised experiences between insurers, intermediaries and members. To create these experiences successful insurers, intermediaries and clients will create value for each other by sharing data that is accurate, complete and treated with high confidentiality. 

Editor’s Thoughts:
Technology has created a platform for insurers to offer personalised products to clients. This is done off the back to key data insights that they get from various platforms. How can insurers use this to improve their product offerings in the future? Please comment below, interact with us on Twitter at @fanews_online or email me your thoughts

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