Other articles in this series:
- Reduce Your Costs by Modernizing Your Distribution
- Modernize Your Insurance Distribution to Reduce Your Risk
- Modernize Your Distribution by Augmenting Your Connectivity
- Build, Measure, Learn — Modernize Your Distribution to Win
Another benefit to modernizing the insurance distribution channel is how it augments your connectivity to your customers. Insurance companies in the auto, health, life, and home markets have already begun to see the benefits of incorporating InsurTechs into their customer relationships. Their examples provide a guide to individual insurance companies.
Insurance companies can now pull data from smartwatches and apps to track activity and other metrics which could lower premiums. John Hancock offered customers free FitBits to track their well-being, and then incentivized them to use them by offering rewards. The healthier you are, the less you pay for life insurance. This data helps individual insurance companies eliminate some of their risk, which I wrote about last week. It does this by ensuring carriers understand the health and habits of their clients and can create more tailored policies and better underwrite them.
Car insurance companies such as Progressive and State Farm have been using InsurTech for years to track driver behavior. If a customer signs up for State Farm’s Drive Safe & Save program, a smartphone and beacon in their car tell the company how they’re driving. The less they drive, and the safer they drive, the more they save on premiums.
« InsurTech also helps you connect in better ways, and more rapidly, to your clients. »
Even if a client needs services outside of business hours, a chatbot can often answer their questions. Chatbots are increasingly becoming more common with eight out of ten people questioned in a recent survey saying that they benefit from them and love that they offer 24/7 answers. With individual insurance companies offering term life products through an online application, access to chatbots is becoming increasingly important. These are big purchases and consumers want to ensure they are properly navigating every step, this often requires support from a chatbot.
Staying in touch and being available to clients at the best times for their schedule increases brand loyalty. Customers who leave due to poor customer service and declining loyalty have put an estimated $470 billion up for grabs in the insurance market. As only 15% of customers say that they’re happy with their insurance company’s digital experience, modernizing your distribution represents a great opportunity to capture new business.
« Augmenting your connectivity now helps you better underwrite policies and prevents expensive claims in the future. »
Customers like receiving discounts on their premiums, and enjoy rewards programs for staying healthy. As InsurTech develops and becomes more common it could be the key to maintaining and capturing new customer relationships.
Stay tuned next week as I look at how modernizing your distribution helps you build, measure and learn faster.