The Digital normal !

Insurance industry has seen a rapid change in customer’s behavior through-out the coronavirus pandemic and the long-lasting impact it sets. Work-from-home arrangements has made internet and digital more essential to households, thus driving faster adoption of digital platforms by Insurers.

Consumers are leading the Insurers to behave like Tech companies. Online has become the main channel for ordering food, groceries, news and just about everything. With more than 80% of what consumers watch online, is recommended content through AI, advertisers are moving to online channel.

When this digital medium becomes the common denominator for consumers, it has set the stage for a few important changes to the industry.

• Customers have a digital expectation and more often than not, compare to the experience they get from other cross-industry experiences like amazon
• Insurers have to meet the consumers where they are, not the other way around
• Customer satisfaction in the digital world needs constant innovation and touchpoints with updates. Think of this as new features on apps on your cell phone. This comes from constant innovation and continuous improvement mindset. Customer retention has started to depend on being 'digitally satisfied'
• With most customers on some digital media all the time, Insurers need to find a way to be available everywhere and all the time.
• The current sales approach through agents and brokers is under pressure
• Employment uncertainty has increased focus on gig-economy and independent workers. Thus driving more focus on product portability.
• Changing behavior has changed customer journeys. Thus the need to customize products, Innovate products faster and ability to partner with an eco-system for while-labeling and umbrella products
• Product diversification and having a holistic financial wellness approach for a customer is gaining focus

The net effect of the new customer journeys and digital will have a profound impact on Insurance industry in the form of operating model, products and customer strategy.

The result of the above are driving a change in more than one ways.

The pace of rebounding the business is dependent on how fast change is implemented. Insurers are working on the below transformation on a war footing to drive this curve to a faster normal.

New Ways of Working : Organizations going through re-org to align business and tech closely, measured with business outcomes and customer focus. Optimizing cost to manage Expense ratio and increase cash flow is a given, but broadly look at assets that can be monetized.

New Ways of operating : Customers are driving Insurers to behave like Tech companies. Speed is the key. Long budget cycles and large projects will be replaced with shark-tank type pitches. Leaders are moving to 100% agile and driving a culture-change with a continuous-innovation and delivery mindset having new customer journeys as focus.

Digital : Digital enabled sales through agency or direct. Customer acquisition, submissions, straight through are key. Counting customer touchpoints as a KPI and driving value our of them, retention are top priority. Additionally, Insurers embracing open eco-systems through open-Insurance approach, API and data insights driven innovation architecture to sustain the business now and for years to come.

Innovation focus : Insurers are executing this in at-least 2 ways. One is to innovate from within. Drive employees and top talent to apply their incumbent experience on the new customer journeys to address quick wins and customer-journey-gaps and incentivize optimization opportunities. The other way is to find new revenue streams, new distribution partners and channels, new products and new ways to stay connected with your customer.

Talent Driven : Insurers are focused on making sure they have the right talent to embrace the above. This is addressed by Insurers in many different ways.

Business and life after covid will change. We don’t know exactly how it looks, but we do know, some of the experiences like remote work, new customer journeys, rise of digital and being fast to respond will stay.