iis china 2014 - the new insurance engagement final
TRANSCRIPT
The New Insurance Engagement
Andrew Dart
15 May 2014
2 CSC Proprietary and Confidential May 15, 2014
Key take aways from this Session
1 Customer engagement is the new high ground for Insurance
2 Engagement boosts profits while binding customers
3 Customer’s will trade their data in return for value from the Insurer
4 The market is moving quickly to this new model
In these disruptive times, transformation is imperative
3 CSC Proprietary and Confidential May 15, 2014
Market Dynamics
Digital is Real!
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Digital is becoming the new
normal for all interactions
Business, as we know it, is changing!
• A tipping point for consumers and businesses has been reached, where the default manner of interacting has shifted from atoms to bits – from physical to Digital.
• Increasingly, all interactions with the Insurer – whether customer, partner, supplier or other – will be done via a Digital, rather than a physical channel.
• Many of today's Digital initiatives fall well short of their transformational potential, being more tactical in nature and lacking a cohesive strategic vision.
• Smart business leaders are rethinking their plans to exploit the potential of “a Cohesive Digital Strategy”; empowering and connecting people inside and outside of the business in new ways – creating new business models and real value in the marketplace.
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Low Returns / High Expenses
Insurance Business Trends all technology enabled or impacted
Connected Consumer / Broker
Distribution Customer
engagement
Customer/Agent
experience
e-Commerce
and straight-
through
Social, Economic,
Climate Change
Profitable
underwriting
Merger &
Acquisition
Claims loss
ratios /process
transformation
Policy
administration
automation
Regulatory change
Emerging markets
Catastrophe
Technology Transforming
Process
Mass customization (pricing, telematics)
Mobile
Analytics
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The Engaged Insurance Customer
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Insurance Customer
The journey to Engagement begins with Insurers moving beyond the transactional mind-set
What happens in between these 2 events – not much!
However 51% of customers
said their Insurer made no
effort to retain them!
Source EY Insurance Consumer survey 2012
Buy
Claim
8 CSC Proprietary and Confidential May 15, 2014
How to become important to the customer every day during the “white space” of these fundamental transactions?
You need to re-think your business model!
Insurance Customer
Customer
Value
Creation
Opportunities
Buy
Claim
Customer
Value
Creation
Opportunities
9 CSC Proprietary and Confidential May 15, 2014
You need data to drive Continuous Customer Value Creation (CCVC)
• Location of customer
• Activity of customer
• Overall goals and aspiration of customer
• Ability to affect meaningful behavioral change of customer in real-time
• How your product/proposition is enhanced by the above
– Better value for customer (perceived)
– Better value for the insurer (bottom line)
Digital Engagement!
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Your Customer Proposition must change
• Not only have you bought the best Insurance product on the Market….
• You are now part of a personalized value creation program that will prove worthwhile to you in your everyday life…..
• The only limit on the value to you, is the data you are willing to share. The only cost to you is the data you are willing to share.
Digital Engagement!
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Examples of Continuous Customer Value Creation
Some real and soon to be real.
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Example of CCVC: P&C Automobile Telematics
Why? Because driving behavior is modified by feed back from the system.
If you use a vehicle with inbuilt “black box” and you give us access to the data, you can opt in for the following services….
– Premium calculated by how safely you drive
– Safe driving alerts / tips; Driving hazard proximity alerts
– Cohort comparison on fuel efficiency / safety by vehicle by driver
– Social media opt-in competition with friends on driving skills / efficiency / safety
– Expense claim assistance by output for company car on trips
Did you know UBI Telematics
programs reduce accidents by
between 20% - 30%?
13 CSC Proprietary and Confidential May 15, 2014
Insurance Customer
Customer
Value
Creation
Opportunities
Buy
Claim
Customer
Value
Creation
Opportunities
Example of CCVC: P&C Automobile Telematics
Customer’s
Value • Premium is reduced
• Claims can be
avoided
• Avoidance of
hazardous driving
conditions
• Can compare myself
with other drivers
• Can compete with
friends on skills
• Helps me keep track
of my business trips
make it easier to
make expense
claims
Insurer’s Value • Great data
• Uses ecosystem
• Reduces claims
• Reduces fraud
• Builds brand affinity
• Potential cross sell
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Example of CCVC: Life Insurance
Why? Because they don’t reach the Hospital in time!
If you wear an X, Y or Z brand of iWatch and you give us access to the data, you can opt in for the following services….
– Life threat detect – early detection (or prediction) of potentially life threatening conditions
– Life threat evac – priority notification to emergency services of your location and condition (even if you are incapacitated)
– Life threat eval – real-time connection with a qualified expert to assist you with evaluating your symptoms and vital signs; can automatically set up an appointment with your nominated health provider
Did you know 250,000 Americans
die from heart attack each year
within 1 hour of initial symptoms?
15 CSC Proprietary and Confidential May 15, 2014
Insurance Customer
Customer
Value
Creation
Opportunities
Buy
Claim
Customer
Value
Creation
Opportunities
Example of CCVC: Life Insurance
Customer’s
Value • Life is monitored for
free
• Life can be saved
• Can talk to a
qualified
professional if I have
a concern
• Discount on
Insurance?
• Another reason to
buy that cool iWatch
Insurer’s Value • Great data
• Uses ecosystem
• If life saved or
concern addressed:
- Persistency
- Delay major claim
- Customer tweets
- Brand Ambassador
- Cross sell
16 CSC Proprietary and Confidential May 15, 2014
Example of CCVC: Life / Health Insurance
Why? Because it’s too bothersome to fill out the form on most apps.
If you have an X, Y or Z brand of device and you share with us the photos of the food you eat, you can opt in for the following services….
– Healthy eating scorecard / planner
– Healthy eating real-time advisor
Did you know that 7 out of 10
health conscious people stop
counting calories?
Healthy people have 16% less heath
related claims than unhealthy
people.
17 CSC Proprietary and Confidential May 15, 2014
Insurance Customer
Customer
Value
Creation
Opportunities
Buy
Claim
Customer
Value
Creation
Opportunities
Example of CCVC: Life / Health Insurance
Customer’s
Value • Calories counted
consistently easily
• Can make healthier
eating choices
• Can hit weight
objective
• Discount on
Insurance?
• Another reason
to buy that
cool iWatch
Insurer’s Value • Great data
• Can make customer
healthier which
reduces claims by
16%
• Brand impact:
- Customer tweets
- Brand Ambassador
- Cross sell
18 CSC Proprietary and Confidential May 15, 2014
Example of CCVC: P&C Automobile (Personal / Fleet)
Why? Often because of incorrect tire inflation or tire over-heating.
If you install a tire monitoring kit from X manufacturer, you can opt in for the following services….
– Discount from X manufacturer of the tire monitor
– Real-time alerts on tire heath and well being (prediction) / savings monitor
Did you know over 23,000
accidents and over 500 deaths
each year due to tire blow-outs?
Note: you will be able to cut personal
fuel consumption by 6% thru correct
tire inflation – saving $265 annually
19 CSC Proprietary and Confidential May 15, 2014
Insurance Customer
Customer
Value
Creation
Opportunities
Buy
Claim
Customer
Value
Creation
Opportunities
Example of CCVC: P&C Automobile (Personal / Fleet)
Customer’s
Value • Avoids potentially
fatal accidents
• Saves on fuel cost
• Increases life of tires
= reduced annual
spend on tires
• Discount on
Insurance?
• No questions asked
claims (assuming
alerts are heeded)
• Discount on cool
device
Insurer’s Value • Interesting data
• Reduces claims
• Increases Renewal %
• Cross sell
• Uses Ecosystem
• Brand impact:
- Customer tweets
- Brand Ambassador
20 CSC Proprietary and Confidential May 15, 2014
Example of CCVC: Workers’ Compensation
If you provide us the access to required data, you can opt in for the following services…
– Workforce sentiment and engagement analysis (internal / external)
– Workforce heath tracking
– Facilities Health & Wellbeing Scorecard
Did you know that organizations with
high employee engagement are 18%
more productive than those with low.
And those with low engagement
have 62% more accidents than those
with high engagement.
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Digital Engagement: The Bottom Line
22 CSC Proprietary and Confidential May 15, 2014
The Bottom Line: If 60% of expenses are claims; a 10% reduction in claims gives a huge boost to Insurance profits…
…while binding your customers tighter!
Reduce accidents Save your life
Live healthy Live happy
Save on your
home energy costs
Save on your
driving costs Insurance Customer
Customer
Value
Creation
Opportunities
Buy
Claim
Customer
Value
Creation
Opportunities
23 CSC Proprietary and Confidential May 15, 2014
Digital Engagement: How do I get there?
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Attractive value
propositions:
• Simpler product and
services that meet
specific client
segments’ needs
• Competitive pricing on
utility basis
• Differentiation through
Digital engagement
Frictionless processes:
• Self-service 24/7
• Front to back digitalized
processes
• Paperless
• Authentic, Efficient and
friendly omni-channel
contact centers
Strategic Approach
Digital engagement demands Insurance Institutions to transform
• Key to becoming a Digital Insurance Organization is to take existing tactical digital solutions, and morph these into a seamless digital experience for customers, partners and employees
• An authentic digital presence for the Organization fostering ever increasing and meaningful digital engagement with customers, partners and employees
Tactical Approach Digital
Financial Services
Organization
Remote collaboration
and engagement
Distribution transformation
& channel strategy
Customer experience excellence
Product and service
innovation, Partner eco-
system Virtual
servicing, automated
provisioning
Advanced risk and decision
making tools
apps
online call
centres
web
mobile
sms
api
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There’s a world of opportunity and many of
your competitors are ready to exploit it
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50 BILLION INTERNET CONNECTED DEVICES BY 2020
Vehicle, Asset, Person & Pet Monitoring & Controlling
Agriculture Automation
Security & Surveillance
Building Management
+ -
Embedded Mobile
Everyday Things
Smart Homes & Cities
Telemedicine & Healthcare
Opportunities: building on the Internet of Things
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What are innovators doing in this disrupted marketplace? Non-traditional competitors and forward-thinking Insurers are capitalizing on these Digital disruptions, staking their claims in this new market place
Mobile Insurance • Africa based mobile phone operator
• Pioneer in providing free micro-insurance
based on talk-time – the more you talk the
greater the cover
• Partnership with Bima and Vanguard Life
Life style Insurances • Pioneering “Life style” insurance
• Discounts on Life Insurance for healthy living
plus other value added services
• Social engagement dimension
• Mobile App
Internet only Life Insurance • First Internet only Life Insurer in Japan
• Premiums are ½ of competitors as a result
of low distribution costs
• Simple, easy to understand products
• 75% of customers are between 20 – 30
years old
Mobile Payments • Replaces a traditional card terminal with a
mobile device (i.e. iPhone)
• Allows anyone to accept card payments
without the need for specialist equipment
• Co-founder of Twitter is the CEO
• Visa have invested
Platform of Engagement • Introduced a platform of engagement for
Motor Insurance
• Only Pay-as-you-drive premiums
• Many value-added services for Insurance
customers and non-customers via analytics
• Social engagement dimension
Usage Based Insurance • Pioneer of Pay-as-you-drive Insurance in US
• Created patented “black box” technology to
track driving behaviour to calculate premiums
• Over 1.4 million customers in first 18 months
• Attracting younger drivers 18 to 25
28 CSC Proprietary and Confidential May 15, 2014
Key take aways from this Session
1 Customer engagement is the new high ground for Insurance
2 Engagement boosts profits while binding customers
3 Customer’s will trade their data in return for value from the Insurer
4 The market is moving quickly to this new model
In these disruptive times, transformation is imperative
29 CSC Proprietary and Confidential May 15, 2014
About the Presenter:
Andrew Dart Industry Strategist
[email protected] @ITInsuranceGuy
+65-9092-2835