SME insurance gets personal

A virtual roundtable of six experts discusses how insurers and brokers could make their products more tailored for small and medium-sized enterprises, how to use data and the role of people in the coming years

Jason Chambers, head of underwriting transformation, Aviva

Glen Clarke, head of strategy and propositions, Allianz Insurance

Giovanni Giuliani, head of strategy, innovation and business development, Zurich Insurance Group

Chris Kay, head of sales UK, Instanda

Joe Thelwell, chief executive, Towergate Insurance Brokers

Simon Welton, market head property and casualty, UK and Ireland, Swiss Re

Why do we still need personalisation in insurance?

JC: As an industry, we love generic products and segments. But what we’re looking to understand is intimate details about the business – what the customer is doing, how they’re doing it, the way they’re performing – because that way you can tailor and provide a solution that completely fits the customer and the price completely reflects what the customer is doing.

CK: Consumers are increasingly expecting tailored, personalised, products that fit their needs. Large disruptive players and smaller niche players are leading the way on this, providing digitalised, personalised products through seamless customer journeys

Do the needs of small and medium-sized businesses differ greatly?

GC: When we talk about small and medium-sized enterprises (SMEs), that’s a very, very broad church. We have quite a different situation from the micro sole-trader end of the market towards a larger SME that might have a couple of hundred employees and a multi-million-pound turnover. So this is a complex environment in which to make sure you get the customer experience right.

How do you personalise products given those huge differences?

JC: Artificial intelligence, machine learning, data science, analytics: all these enable us to support the customer in the digital journey to make sure the choices they make, the value for money and the support they’re getting is right for them. What we don’t want to do is put our digital and automation ambitions at the centre of our distribution solely for efficiencies. It has to be the customer at the centre. Simplification is absolutely key.

GG: We sell products that are very clear to us, but at times they may not be clear enough to the customer. So selling fewer, more simple and more meaningful products would be a step forward. However, simple doesn’t mean we cannot offer targeted propositions. We can offer customised variations of a product through digitalisation and innovation. It’s most important we offer a simple product, that is both easy to understand for the customer and easy to manage for the carrier.

CK: Legacy systems can hold insurers back because older, product-focused platforms are unable to develop customer-first propositions. But new, usually no-code, platforms can. It means embracing newer digital-first solutions which put the customer fi

Rather than collecting more, firms need to focus on collecting the right informa­tion. They can only do that by embrac­ing emerging technology

Isn’t it counterintuitive to offer fewer, simpler products when you are trying to make products more personal?

GG: Simpler doesn’t mean less powerful or less sophisticated. Actually, I would argue simplicity is the most difficult thing to achieve in any area.

GC: I agree. What a lot of SMEs, particularly at the smaller end, are looking for is reassurance. They don’t necessarily want to be amazed by the complexity of your products, but they do want the reassurance they have the right cover for the things that are critical to their specific business.

Are firms collecting the right information to personalise products?

JT: We shouldn’t see this as customers buying a singular product in a moment. We should start seeing these as clients who need to be looked after for a longer period of time. So sometimes more open-ended, more qualitative questions should be asked, to understand what is appropriate.

SW: Modern consumers are a lot more comfortable with sharing their data, so I don’t think we need to be too shy of taking data from customers and using it. The industry has looked back for 300 years and trended data forward, but that isn’t going to work for new and emerging risks. We have to go and get data from other sources.

GC: Yes, obviously over the last few years we’ve seen an almost exponential explosion in the amount of data available in the market and it’s not necessarily supplied directly by the client.

CK: Currently, consumers are required to input a great deal of information and can still end up with an unpersonalised product. Rather than collecting more, firms need to focus on collecting the right information. They can only do that by embracing emerging technology, like data and artificial intelligence.

So is the future all digital?

JT: I think at the start of this pandemic, people believed it would be only a digital world that re-emerged. I believe clients want options, they want to have the digital choice, but also want a face-to-face choice.

CK: Insurance is a human industry and that shouldn’t disappear. Digital experiences can actually make things more human, by making the purchasing and claims processes more responsive and straightforward.

SW: When I first started in the business, a boss said to me, “There’s really only two things that matter, people and money, and you can’t have a relationship with money”. I’d say it has evolved a little bit now. Money and data can inform the decisions about risk, but you still need the people. You can automate a lot of the process, but people are still a very valuable part of this business because it’s based on trust.

JT: I think humans are the differentiator in the future and digital can complement human interaction. Insurance is probably the most complicated contract you will sign in your life without a solicitor present. So we need to make sure we give really appropriate advice and really tailor the product.

What role will your people play in the years to come?

GG: Humans were not created to do repetitive tasks all day. It’s boring, it’s frustrating, it’s also wasteful. Humans were created to nurture relationships through social interactions, to find creative solutions to complex problems, which machines are not able to do. But now we can deploy the right digital resources, I would say the human personalisation of the interaction with customers will be even more important and will be what differentiates us in the future.

JC: The winners will be people who get that and it’s a difficult recipe. We need to be ambitious about getting the perfect balance between data, technology and human intervention.

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