Why does it always rain on me?

When an anonymous writer was once asked whether he had ever seen such a brutal winter as the icy, stormy one of 1878, he replied, "Yes, last summer." Mark Twain’s response to this was "I judge he spent his summer in Paris."

While I love living in Paris, I know the weather can be far from stable. When it comes to my summer vacation, I want the sun. And that means I’ll probably be going to Greece for 5 days. But what if it rains? My experience will be ruined.

I know it’s not possible to guarantee the weather. But in this day and age, there should be endless options for personalised insurance products – just as I have endless options when purchasing clothing online, selecting a smartphone or a summer vacation package. What I want is to be offered a bespoke insurance product giving me rainy day protection when I book my summer vacation. That way, I can at least receive compensation if it rains, and have available cash for finding better suited activities that I can still enjoy.

Sounds far-fetched? Actually not, it’s already becoming a reality! Parametric insurance, also referred to as a new spin on an old product, enables insuring against a wide range of risks, which previously were not enabled. This is possible through the integration of machine learning and predictive models, which enable insurance solutions even in fast-changing climates.

All this indicates that the product I want can be personalised to my vacation – location and dates – by calculating a specific premium based on the summer weather patterns in Greece. And it also means that claims handling can be completely automated, based on external data sources of rain prediction. Such sources retrospectively indicate the amount of precipitation every 24 hours, enabling smart insurance platforms to ascertain whether there is a claim. If that’s the case, payment of the claim is automatic, so this means I will get compensated immediately without having to do claim or prove anything.

Mark Twain also said, "Climate is what we expect, weather is what we get". But if Mark Twain was an insurance customer like me – demanding a straightforward, personalised and worry-free insurance experience – he’d probably say, "Weather is what we expect, insurance is what we should get."

About the Author
As Business Development Director at Setoo, Julien Carmona brings a 10-year track record in corporate strategy, business development and successful digital transformation implementation in various industries. Passionate about disruption and digital models, Julien is also very familiar with the innovation ecosystem in Europe and the US.


Can insurance really deliver on endless personalised needs?

Ancillary products play a major role for e-businesses looking for ways to expand their offering, increase revenue and improve their customer experience. For insurance-related ancillary products, e-businesses must seek the best way to guarantee that the insurance products offered in their customer journey really add value to their consumers, particularly millennials.

Sounds simple. But what does this require? Primarily, e-businesses need the flexibility and independence to determine what insurance products to offer; when to offer them; at what price and to which specific consumers; and how to present and communicate their packages.

Today, most of the available e-business insurance products are fixed and offered at a set price. Typical examples include travel insurance products that usually embed a predetermined set of guarantees, regardless of the consumer’s specific needs.

E-businesses have different types of customers with diverse insurance needs. Consider the following examples:

  • Insurance for flight cancellation is less relevant to business travelers, who would typically want to be offered insurance for short flight delays to ensure they get to their meetings on time.
  • A family going on a summer vacation to Greece does not require a snow guarantee insurance policy, but would definitely benefit from a rain-free protection package.

These examples not only indicate how complex insurance packages can be; they also highlight the customer experience that is expected. Today, consumers don’t want to match their needs to products – they expect products to meet their needs, along with a perfectly tailored customer journey.

This requires the personalisation of products to ensure relevance to customers’ actual needs. Furthermore, e-business should be offering insurance products with policies priced according to particular travel arrangements and potential risk. That way, a customer going on a one-day business trip from London to Paris will get a different insurance offer than a customer traveling from Rome to Berlin for a getaway weekend via a low-cost carrier.

How can e-businesses meet specific demands for practically endless protections? It requires a paradigm shift in how insurance is being offered, because it literally involves maintaining a factory of insurance products. The ideal solution is a generic insurance platform. Today’s innovation enables such platforms to be integrated via simple APIs into the selling process, forming an automated factory for easily distributing unlimited bespoke solutions and delivering an exceptional buying experience.

About the Author
As Business Development Director at Setoo, Julien Carmona brings a 10-year track record in corporate strategy, business development and successful digital transformation implementation in various industries. Passionate about disruption and digital models, Julien is also very familiar with the innovation ecosystem in Europe and the US.