capturing the insurance customer of tomorrow

Three key questions to guide success

Capturing the insurance customer of tomorrow

Copyright © 2015 Accenture All rights reserved. 2

Today’s insurance customer

More empowered More social Higher expectations

Significantly different buying habits


Impact of new customer profile

Accenture Research

Loyalty has declined

Likelihood of switching providers has risen

Huge switching economy has emerged

• Only 29% of customers highly satisfied with providers

• Only 15% sure to buy more from incumbent providers

• $470 billion of personal-lines life and P&C premiums in play worldwide in 2014


Winners in the new switching economy

Companies that exploit digital technologies and convert innovation into:

Customer insight Mass personalization Hyperscale

Interconnectedness Operational efficiency Agility


Stark choice for insurers

Embrace digital technology and customer-centricity

Move out of distribution to focus on manufacturing

Maintain the status quo—the least likely option to succeed


Formidable challenges lie ahead

Three key questions can guide insurers to success as they adapt to changing customers, an evolving competitive landscape and transformative technologies:

How far and how fast should they proceed to customer-centricity?

What does it taketo become a Digital Transformer?

What role can they play in a larger service ecosystem?

Q.1 Q.2 Q.3

7

QUESTION 1: HOW FAR AND HOW FAST SHOULD INSURERS PROCEED TO CUSTOMER-CENTRICITY?


How far and how fast should insurers proceed to customer-centricity?

of P&C insurance customers believe most carriers’ products and services are the same

Q.1

A 7% increase in one year

Helps explain why price is the main reason customers switch carriers48% included pricing in top three reasons they switch

21%

Value for money ranked second 38% included it in top three reasons they switch



Digital Transformers—a minority of insurers— put customers at the center of their business

Q.1

Only 56% of Digital Followers have taken the same measures

82% of Digital Transformers:– Invest in digital channels & technology for customer-centricity– Provide tailored offerings



Most carriers know they need to improve:

Q.1

• Look at partnering with companies outside the insurance industry• Form or join an ecosystem• Offer a broader range of products & services

• Customer understanding & segmentation• Tailored propositions to various segments• Strength of their multi-channel capabilities

To provide what customers value they should:


How far and how fast should insurers proceed to customer-centricity?Q.1

But only 27% of consumers have a high estimation of insurers’ trustworthiness

• Build customer trust by:– Providing added value– Communicating regularly

12

QUESTION 2: WHAT DOES IT TAKE TO BECOME A DIGITAL TRANSFORMER?


What does it take to become a Digital Transformer?Q.2

ANSWER:

A holistic approach to digital transformation that looks:

• Beyond insurance

• Outside of the enterprise



23%

47%

15%

of customers would buy insurance online

want more online interactions with insurers

Are satisfied with their provider’s digital experience



83%

59%

57%

of insurers believe digital technologies will transform their customer interactions

expect challenges from online service providers

expect challenges from aggregators


What does it take to become a digital transformer?Q.2

The sweet spot where customer

and business value intersect

Where Digital Transformers

focus their digital

investments



Three characteristics of a Digital Transformer

VIEW DIGITAL TECHNOLOGY AS A CATALYST FOR TRANSFORMATION• Not only for doing the same things better• An avenue to new sources of customer value

CREATE DIGITAL VALUE PROPOSITIONS• Often part of a larger ecosystem• Used to strengthen various relationships

ESTABLISH A HOLISTIC BUSINESS STRATEGY • Digital strategy spans the insurance value chain• All digital technology explored to emulate successful online giants

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QUESTION 3: What role can you play in a larger service ecosystem?


What role can you play in a larger service ecosystem?Q.3

Create an ecosystem?

-OR-

Take a supporting role?

Insurer is better placed to secure a leading role for itself

A supporting role in an established, stronger ecosystem might yield better results for the insurer and its customers

But the more sophisticated an insurer’s digital capabilities are, the stronger its position will be in any ecosystem


• 49% of P&C customers worldwide purchased coverage online

– 41% used mobile devices

• 59% of emerging-market customers purchased online

– 69% used mobile devices

• 72% of insurers have formed or plan a new distribution partnership soon


Three factors reinforce an insurer’s ecosystem role

1. Improving distribution capabilities


• Create customized offerings

• Provide seamless, omni-channel marketing, sales & service experiences

• Tie it all together with digital technology

• 61% of insurers exploring possibilities within an ecosystem



2. Offering adjacent non-insurance products & services


• A skilled insurance workforce, aware of customer needs, drives satisfaction

• Digital technology already meets simple customer needs

• The bar is higher for meeting more complex customer needs

• 43% of insurers have acquired or plan acquisitions to build new digital capabilities



3. Introducing new skills

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