Aspirational insurance is the future but do you have the technology and the resources to support it?

12th November 2018

Over the years, insurance companies have typically paid out when something’s gone wrong. They pay out if crops catch on fire, if there’s a road accident and they pay out when someone dies or becomes disabled (provided, of course, they have the right cover in place and everything was underwritten correctly).

But there’s an important shift occurring now and we’re finding that insurance companies are rewarding their customers too instead of only dishing out cash when something horrible happens.

Now they are using incentives (whether it be through points, discounts or rewards) to encourage their customers to lead healthier lifestyles, drive better and one insurer has even launched an educational product overseas that provides those insured with a payout for university studies if the main cover holders have lived a healthy lifestyle.

Telematics, for instance, has made it possible for insurers like Admiral, which launched LittleBox in 2013 to track their customers’ driving behavior and, based on how well they drive (for example fast driving and harsh braking are not encouraged), they can qualify for a discount when it comes to renewing their policies.

Meanwhile, life insurers like Discovery have a rewards scheme (Vitality in Discovery’s instance) which offer discounts like 40% off monthly gym fees through the likes of Nuffield Health and David Lloyds Clubs.

Discovery is also behind providing the innovative cover (the Global Education Protector) which provides cover for your child’s tertiary education fees. Up to 100% of the tertiary fees can be funded through leading a healthy lifestyle through Discovery’s Vitality product. It launched the product in South Africa, but it will no doubt launch something similar in the United Kingdom if it’s successful in time.  

But if you are thinking of promoting or creating such innovative products do you have the technology to back it up?

According to one expert commentator, most businesses don’t seem to be geared up to be able to make use of the telematics data during the claims process. In April Penny Searles, CEO of the Smartdriverclub wrote that in spite of the vast number of insurers having some form of telematics proposition it is often just used to rate risk and not used during the claims stage.

She said that, as a result, many motor claims departments simply revert back to standard practice when it comes to handling claims and ignoring the evidence provided by the black box because ‘their infrastructure has no way of dealing with it’. The training and technology are simply not there, because there’s not enough investment in it.

It would be a shame to offer something and not make full use of all the benefits that it could provide (both for your business and for the customer). There are endless ways in which you could reward customers in the future. Car and life insurance products need not be the only types of cover to offer such rewards.

But they need the right investment and experts to create a successful rewards system. If you believe you don’t have the right experts to hand, then why not talk to us to establish if you do have everything you need to support such a product and all the technological benefits that come with it?

Consumers like being rewarded. And we have a feeling that they will come to expect such rewards from all their insurance products in the future. It would be a disappointment if it doesn’t do all that you or your customers expect!

 

 

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