Accenture Financial Services’ Global Distribution & Marketing Consumer Survey gathered the views of nearly 33,000 insurance customers across 18 markets. It shows that insurers have attractive opportunities to increase their customer relevance and value by engaging more frequently with more personalized services.
Accenture’s analysis of the Global Distribution & Marketing Consumer Survey findings produced three distinct consumer personas, each differentiated by its members’ attitudes toward competitive pricing and low cost, and the level of their interest in high-quality, responsive service.
In addition, two important drivers of loyalty were considered: trust (measured in part by the insurer’s ability to protect personal data) and interest in an innovative digital model, reflected by the consumer’s willingness to consider an online provider such as Amazon or Google for insurance and other financial services.
The varying needs and priorities of these groups provide insight into how insurers can reshape their distribution models to increase the loyalty of existing customers and reach out to new consumers.
Nomads: The first segment is a highly digitally active group, ready for a new model of delivery. Its members are not tied to traditional financial service providers. Nomads are happy to use Amazon or Google for financial services.
Nomads value digital innovation and want new ways of accessing services and advice. Nomads are very open to the concept of computer-generated advice.
Hunters: This group is searching for the best deal on price. Competitive pricing and getting the best value for their money drives loyalty for Hunters. Human advisors remain crucial to Hunters—they do not feel they can get what they need without human advice.
Hunters are not prepared to depend on computer-generated advice and they want to use traditional insurers and financial services firms.
Quality Seekers: The final group is loyal to insurers that deliver on brand integrity and service excellence. Quality Seekers want a financial services provider that will put their interests first; this is a key loyalty driver, as is confidence that their personal information will be kept secure.
Providers that offer high-quality, responsive service are essential to Quality Seekers. Quality Seekers are driven by trust and the level of service rather than by cost.
The insurance response: Becoming an everyday insurer
Shifts in consumer behavior and the emergence of different consumer personas—in particular, the Nomads—have significant implications for insurers. They need to move toward becoming an everyday insurer.
It is imperative for most carriers to not only transform their distribution models, organizations and physical networks, but to present consumers with new offerings, advice, and services. They must do so by means of an experience that is highly personalized and relevant within the context of customers’ daily lives.
For example, while some customers may be satisfied with insurers’ traditional offerings and customer experience, the Nomads certainly will not be. Representing 40 percent of the insurance market, and as the youngest and fastest-growing segment—and therefore the future of the industry—they need to be taken seriously.
Carriers need to change their business model from one that is product- and process-driven to one in which the customer is central, in which data and analytics drive most decisions and experiences, and where the key enablers are advanced technologies and a more strategic management of information. They also need to balance their investments across their core business and ‘the new’.
On the one hand they need to transform their core, to drive up their investment capacity to fund incremental growth. At the same time they need to identify the new opportunities that are emerging alongside their core business, and work out how to scale them to realize the more dynamic growth which ‘the new’ offers.
We have identified five potential new distribution models for insurers looking to create new offerings and ‘everyday’ value propositions:
The virtual insurance advisor: Insurers adopting this model can aid the customer and/or distribution partners in making insurance-related choices by leveraging data-driven personalized advice and insights embedded within web, mobile, and voice-based platforms (including company/aggregator websites, mobile apps, messaging apps, chatbots, voice-based intelligent virtual assistants and social media).
The everyday risk coach: Insurers help customers improve their personal and financial wellness and reduce the risk of loss or injury, whether behind the wheel, in the home, at work, or through the adoption of healthier habits and lifestyles.
The plug and play insurer: These insurers embed their products and offerings into the experiences of strategic partners, ranging from car manufacturers and/or dealers to home service providers to retailers to internet giants.
The ecosystem orchestrator: Insurers integrate and rationalize related risk and non-risk products to address customer needs in a liquid manner that spans multiple traditional industries and disciplines. Insurers adopting this model build strong relationships with ecosystem partners and develop deep insights into customer needs and preferences.
The P2P network operator: The insurer adopting this model may distribute to pools of customers linked by affinities, reducing distribution and claims costs while tapping into a new base of potential customers through a value proposition centered around the common good.