A common thread among new digital insurance players such as Brolly, Knip, Trov, and PolicyGenius is customer empowerment via policy management. The industry should learn from the development of personal financial management (PFM) tools.
The move by new players to provide insurance e-wallets or “lockers” – and evolving beyond this to create a digital dashboard, guide, or “concierge” for policies – draws parallels with the retail banking world’s development of PFM tools.
Banking has been playing with PFM solutions for years, revealing the insurance industry’s position a little behind the curve. Yet the benefit of playing catch-up is that new players – as well as incumbents looking to react to them – have an opportunity to heed valuable lessons and view what may lie ahead:
- Services can only successfully engage if the effort/reward sweet spot is found. Trov has understood the importance of adding items to the locker by convenient means, otherwise its service to create an inventory of your belongings could be beyond tedious. Also key is that the reward needs to be communicated effectively to motivate users to jump in.
- Tools are only as useful as the size of the applicable ecosystem. Solutions that try to hold too tightly onto customer ownership will likely have the opposite effect. e-wallets that only work with a brand’s own policies are of limited use – a lesson understood by Worry+Peace’s new “pouch,” which can hold information on multiple brands’ policies.
- Traction is being found only in moving from a backwards-looking view to guiding “in the moment.” PFM tools have taken a leap forward with the dawn of predictive, actionable, and engaging insight rather than simply providing a static reflection of the user’s input. Providers should always be asking “what’s the next step?” and “where’s the value-add?”
By Stewart McEwan, Head of UK General Insurance