We’re seeing digital technology reshape the world’s consumer-facing industries. Amazon has changed retail, Netflix is transforming television, Uber is shaking up transport, Facebook has reshaped media, and Airbnb has disrupted hospitality. But up until now, life insurers have largely stuck to the same business model they have followed for three decades or more. By Bryan McLachlan, CEO at Instant Life
That picture is rapidly changing as the industry wakes up to the potential of new technology and as consumers start to demand that insurance becomes as convenient, transparent and simple as the other industries they deal with every day.
Customers want buying complex financial products to be seamless and easy.
Cheaper smartphones, better connectivity and growing digital literacy mean that the industry has a great opportunity to offer customers life insurance products through a more automated and convenient process.
Digital technology allows life insurers to run back-office processes more efficiently while delivering a better customer experience at the front-end.
Big Data Benefits
Thanks to big data and the cloud, we can now underwrite life cover more cost-effectively and efficiently than ever before; and because of digital channels such as the Web and mobile we can distribute and service policies in a manner that is faster and more convenient for the consumer.
Life insurers that seize the potential of this technology will be positioned to lead the market in the years to come.
Digital customer experiences and insights, big data, and technology mean that we can today take a lot of the time and complexity out of underwriting life insurance.
For example, our technology enables consumers to buy life cover in under 20 minutes and save up to 30% on their premiums, online, through the call centre or face to face. The technology is lean, cloud-based and paperless, so it’s cost-effective to operate and translates into savings for our customers.
People are able to buy cover online 24 hours a day, 365 days a year, with no medical examination required. They can also manage their policies themselves via an online portal.
The business model delivers insurance that offers value and peace-of-mind for sophisticated customers looking for a better, digitally-enabled customer experience.
Use of big data and mobile technology also means that we are now able to make life insurance a more personalised and interactive experience.
For example, our Fitlife Policy comes with a Fitbit Flex Activity Tracker. For people who track their activity for six consecutive months, we reduce your premiums by 15%.
Should financial planners and advisors be concerned?
Financial intermediaries benefit from digital channels because they can shift focus from administration towards sales and personalised advice.
Going forward they will be able to use the digital system themselves to quickly issue policies for clients on the spot rather than needing to spend hours processing paperwork. And it also means that customers can handle routine service queries themselves, for example, changing personal details. This allows the financial advisor more time for meaningful conversations and value added advice in building relationships with customers.
Customers now have choice between their broker, telesales and the Web. Most customers who have advisors will continue to depend on them, but now, life insurance is more accessible to new segments of the market through alternative channels such as online and through the call centre.
For us, bringing a step change in value and convenience of this valuable and important financial service the real digital revolution.
As a testament to this, we have recently been awarded the Frost & Sullivan 2016 South African Customer Value Leadership Award.
Frost & Sullivan conducts best practices research to properly identify unrivalled innovation and leadership among companies, products, processes, and executives.
The Best Practice Award is a very strong indicator that Instant Life addresses the growing market need for pure-risk life insurance sold online that offers high-quality coverage and product offerings.