Consumer Tech Trends
Changing the insurance landscape
29th November 2018This month, Deloitte released its annual Mobile Consumer Survey, which showed that smartphone penetration in the UK has increased again, now reaching 87% for the 18-75 demographic and near universal adoption for generation Z at 96%.
The rise of the smartphone has been a key disruptor in changing the way we live and do business, but it has been surprisingly slow to impact the world of insurance. However, this is changing, as retailers realise the opportunities it creates to harness new channels to market and introduce innovative pricing and promotion strategies. We take a closer look at this new landscape.
Tailored offerings & a simplified processMobile apps, in particular, have emerged as a game changer across the insurance industry. People want increasingly tailored communications and offerings, something the smartphone app can provide through the collection of consumer data to create personalised insurance quotes.
CDL's proactive insurance solution, Chorus, is a prime example of this individualisation. The combination of image recognition and WI-FI network scanning allows the retailer to generate a quote with minimal consumer input beyond validation. Moreover, the app enables a portfolio of policies to be built and stored in one place, both improving the customer experience and increasing cross-selling opportunities for the retailer.
It doesn't stop there. Insurers have simplified claims processes, using smartphone cameras to report incidents in-app and provide supporting evidence – simultaneously improving accuracy and speed of resolution. Recently, Aviva have taken it one step further, integrating a dash cam into its mobile app, which offers automatic collision detection and video streaming.
Mobile technology also offers a good fit with dynamic pricing models and usage based insurance, where consumers are likely to desire regular and easy access to their dashboard. This has also opened the door to the subscription model, which enables retailers to move away from the traditional renewals cycle.
Engagement through gamificationWith insurers constantly looking for ways to get customers to more actively engage with their mobile apps, one way to achieve this is through gamification. Innovative B2B startup, Yulife, has created a life insurance platform that rewards employees for making healthy lifestyle choices with their in-app currency, yucoin. The unique angle of incentivising healthy behaviour to reduce risk could provide a model for the more socially responsible insurance firm of the future.
Wearables driving new propositionsThe sister technology to the smartphone is the wearable device.
According to Deloitte, ownership of wearable devices has risen faster than any other portable tech and will continue to experience rapid growth in the next few years. Driven by the popularity of Apple's smart watch and health and fitness trackers, such as Fitbit, the number of connected wearable devices worldwide is forecast to increase from 325 million in 2016 to over 830 million by 2020.
The rise in wearables is already having a major impact on the insurance industry. This year, John Hancock one of America's largest and oldest insurers, has declared it will only sell interactive policies that collect health data through wearable devices. Similar to telematics for car insurance, the aim is to create a more personalised product that promotes and rewards healthier lives.
Life insurance is not the only area undergoing transformation; smartwatches are now also being used to improve the claims process. For instance, if a smartwatch is linked to a smartphone that is stolen, data on the connection loss can be used as concrete evidence. By eliminating the need for customer testimonials, wearable technology has the potential to improve the reliability and efficiency of the claims process.
New possibilitiesIn short, advances in mobile and wearable technology offer significant opportunities for the both the retailer and consumer. As insurance processes become more efficient and engaging, customer satisfaction will rise, driving revenues and profitability.