The insurance industry is no exception to the rising need for more and better-automated experiences in our daily lives. Insurtech businesses have embraced this technique in recent years to increase customer efficiency and experience while better evaluating risk for the business. However, it has not been a simple task, and the digital revolution of this industry is far from complete. Consumers are always on the lookout for improved services that are more efficient and simple to use.
In fact, according to a recent Publicis Sapient poll, 100 percent of consumers who switched providers in the previous year did so because of poor customer service. This is higher than the 70% who said price was a motivator for switching. This reflects a changing market in which customers have greater and varying expectations for insurance services, owing in part to the ease with which they can now perform other digital operations like as shopping and banking. However, given both the emotional nature of the events that prompt customers to submit insurance claims and rising worries about data ethics and privacy, they are cautious to depend too much on automated systems.
Consumers are increasingly gravitating toward digital insurance experiences on many levels, and this trend is expected to continue. People would prefer a mobile app than a phone call or in-person chat for obtaining claim updates, according to our poll. Despite these shifts, it is apparent that humans will continue to play an important role, particularly in customer service, where they can deliver empathy and caring that data and AI cannot.
Consumers are also yearning for better digital services, according to their perceptions. In fact, 15% stated they switched providers because they wanted a better digital experience. Filling out forms and supplying information, as well as comprehending rules and coverage, were among the activities that might be made easier with technology. Finally, insurance companies are reacting. Insurtech investment increased to $15.4 billion in 2021, nearly double what was raised in 2020.
And the funds came from a variety of sources and were directed toward a number of insurance companies, demonstrating that technology is playing a larger role in the industry. This certainly indicates that the industry is changing. This comes at a time when the insurance industry is facing additional challenges, including as the COVID-19 pandemic, more extreme weather occurrences, and the emergence of self-driving automobiles.
Data’s rising importance and the need to comprehend it, Smooth digital interactions aren’t the only thing that’s changing. The way insurance firms and customers use data is also changing fast. Usage-based insurance (UBI) is a new product that uses data to reward customers for “good behavior.” For example, in the vehicle insurance industry, drivers who have better driving practices or drive less than the national average might get discounts on their policies. Such ideas may become increasingly popular in insurance products in the future.