Why is there a disconnect between consumer expectations and insurance?

Three key issues contribute to the disconnect between modern consumer expectations and the insurance industry:

Insurance products are not integrated seamlessly within the customer journey: Since insurance is usually sold via insurance providers, the sale is typically completed directly on their sites, even if offered first via an affiliate link. As a result, insurance is not a smoothly integrated product in the purchasing experience. Statistics show that 72% of UK consumers, and 4 out of 5 millennials, leave a website before completing the purchase because of a complex, long process. Hence, it’s highly unlikely they’ll stay engaged long enough to buy insurance…

One-size-fits-all policies are irrelevant to today’s consumers: Insurers typically offer generic policies that do not address individual needs. For example, a consumer seeking guaranteed refund for excessive rain may often find that the only policy containing this feature is premium-priced as it includes protection for additional activities, such as skydiving. Another consumer may not be able to buy a single policy that provides coverage for missing luggage or a late train. The key issue here is a lack of relevancy and personalisation, which is what today’s consumers demand.

Unclear policies with tedious claims processes are unacceptable: We’re all aware of notoriously complicated claims processes, which require notifying the insurer of an incident, finding the right forms to download and complete, providing evidence such as receipts, etc. Furthermore, relevant documents have to be on-hand to verify the event is not subject to any exclusion rules. Finally, after submission, it can take weeks and even months for the insurance company to assess and process the claim. This is a far cry from millennial demands for a simple, fast and hassle-free experience.

What’s the solution? Can insurance be sold as a personalised product that simplifies the customer experience? Definitely yes, when using parametric-based, insurance-as-a-service platforms that leverage AI and machine learning technologies. This enables addressing individual customer experience pains, cutting costs, boosting sales and improving the customer journey overall to overcome the gap between consumer expectations and insurance.

About the Author

Dalya Rochman is a marketing executive with a 15-year proven track record of achievement in data-driven B2C/B2B marketing. Responsible for Customer Success in Setoo, she fully realises that the success of our customers is our success. And she intends to achieve this by combining her extensive global experience in customer management, big data platform automation systems, prediction models and analytics, with her personal “can do” approach and out-of-the box thinking.