InsurTech has been around for a while now and following a 2695% rise in investment between 2016 and 2017, it’s not disappearing anytime soon. According to an analysis by CB Insights, £218 million was invested in InsurTech businesses in the first half of 2017, up from £7.8 million the previous year.
What is InsurTech?
InsurTech follows the success of FinTech start-ups and seeks to utilise new, innovative technology to address the issues faced by today’s incumbents. Like banks, insurance retailers have been slow to respond to emerging technologies and InsurTech’s compelling proposition is to deliver products and services more aligned with the customer of the digital age.
Naturally, Insurance retailers are anxious over the rise of these agile and technologically-oriented businesses, which are – for the moment – unencumbered by hefty regulatory requirements and bulky legacy systems. Combining this with an entrepreneurial, fast-paced approach, InsurTechs have the potential to disrupt the insurance industry and pose fierce competition in an already crowded marketplace through the use of an insurance customer portal.
However, it’s worth remembering that not all InsurTechs are out to disrupt the insurance industry or replace traditional insurers with new customer offerings. Some – the majority, in fact – exist to enable insurance retailers to advance and streamline their processes, working in partnership with them to provide improved customer engagement and overcome technology roadblocks whilst lowering operational costs.
Here are some examples of how InsurTechs are enabling insurance retailers:
1. Resolving data siloes
Whether a company’s disjointed technology siloes are the by-product of multiple product lines or mergers and acquisitions – not having all of their customer data in the same place makes it difficult for insurance retailers to deliver a high level of customer service and efficiency.
InsurTechs look to apply new digital capabilities to transform the insurance sector from one hindered by data, product and system siloes, to one that is integrated and intuitive. Bringing all of this data together in the same place provides a 360-degree view of the customer, enabling the insurer to stay up to date and ultimately deliver a better experience.
2. Improving the customer experience
Customers now expect a convenient, seamless and instant experience across multiple digital touchpoints, at any time throughout the day. According to Capgemini’s 2017 World Insurance Report, consumers now prefer digital touchpoints when conducting insurance transactions and value services that are agile.
Delivering an omnichannel experience in an on-demand, digital-first world will be critical to insurers’ success. InsurTech can help achieve this by integrating multiple channels into one singular experience; from online interaction, through to mobile, contact centre, or in-branch. Teaming this with a 24/7 self-service portal provides customers with the instant access they now demand.
3. Making good use of data
Insurers and brokers need to provide a convenient and personalised experience which is tailored to individual customer needs. Customers need to feel valued and understood in order to remain loyal and the collection, aggregation and effective management of customer data is central to satisfying customers.
InsurTechs can help insurers demonstrate an awareness of previous interactions with the customer. Using this data, retailers can then customise each interaction based on the customer’s interests or actions, as well as deliver targeted and relevant marketing communications.
With the strengthening of data protection regulation (GDPR coming into effect May 2018) insurance retailers also need to demonstrate compliance with the management of customer data and having a modern, aggregated data architecture is critical to achieving this.
The InsurTech solution to this problem is a digital data management wrapper across all of the legacy data siloes.
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