As the insurance industry continues to evolve and adapt to technological changes, traditional insurance companies are facing disruption. While right now they still have a strong presence, they will need to adapt to keep up with new competitive offerings.
Technology companies are now entering the insurance sector and becoming competitors for long standing, traditional insurance companies. These insurance-technology (insurtech) companies are innovators, offering digital savvy solutions that appeal to younger, technology inclined consumers.
Audiences that are more likely to show interest in insurtech companies include parents of young children. According to Mintel’s 2018 Insurance Marketing report, 14% of this demographic voiced interest in purchasing health insurance from a technology-based company, opposed to just 7% of all adults. This could be because they are looking for product differentiation and quicker and easier ways to navigate their insurance choices.
One issue traditional insurance companies face is product differentiation. Right now, the main things consumers look for in an insurance company is whether their current doctors are covered, and the price. Aside from that, consumers view all traditional insurance companies the same way, therefore they are not afraid to buy a product elsewhere and seek out different solutions.
A major way insurance companies are differentiating themselves is through personalized customer experiences. Today, only 57% report experiencing good customer service from their health insurance company They are focusing on service and making the process as quick and easy as possible.
One example of this is health insurance start-up, Oscar. They assign every policyholder a four person “concierge” team, consisting of a nurse and three aides. This team uses their knowledge of the healthcare system to locate in-network specialists and set up appointments.
Another example is Covera Technologies Inc., a insurtech startup that used data and proprietary algorithms to find the best and relevant policies with policyholders when it is time to renew every year.
A vital part of providing elevated customer experience, is truly understanding the consumer “journey”, and figuring out where the pain points are. Moving forward, creating ease and satisfaction throughout each part of the consumer journey and then optimizing to better serve policyholders will be essential in the success of insurance companies in this competitive landscape.
Mintel │ Insurance Marketing Trend 2018 │ Insurance as a Service.
Mintel │ The Insurance Purchase Decision │ August 2017.
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