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Spotlight: Personalisation – what progress has been made?

A magnifying glass finding a person among many

Customers now expect personalised service, tailored products, and the ability to buy, update and access their policies 24/7. Valerie Hart explores how insurers are moving away from a one-size-fits-all approach because they can’t afford to be left behind.

The insurance industry hasn’t developed as quickly as many other sectors when it comes to customer personalisation. Large insurers are having to tackle legacy systems and redesign processes as channel preferences change and data needs to connect to create a holistic view of the customer.

“As the industry works to redefine their processes and capabilities, we will be able to create more relevant and personalised products and journeys for our customers,” Axa UK and Ireland’s Vicki Joshi, customer and brand director, tells Post.

Axa, for instance, has rolled out a data lake across all its business areas. “By moving to a modern, cloud-based system we can get more consistent, robust and usable data to our analysts quicker and ultimately provide better outcomes for our customers such as more personalised offerings and clearer understanding of their needs.”  

Customer centric

Covéa Insurance, too, has been working on a new core platform. Vicki Heslop, Covéa’s head of customer experience, explains how it is bringing all its data together and centralising it under the customer banner. Previously, the concept was of separate claim and policy systems, with everything geared under the policy number.

“We aim to have the customer as the centre of our data structure, enabling us to be a lot more fluid in how we manage the experience across different points of the customer lifecycle. This helps our agents when talking to a customer or customers themselves when they are able to see their full experience in a single place,” she explains.

In order to offer a truly personalised service the sector must develop a deeper understanding of who the customer is and what they want. Data science and analytics play a key role in developing greater meaningful insights into the risks customers face.

“Historically, the industry has prepared broad propositions that fit a ‘typical’ customer. Going forward the businesses that will be successful are those that use artificial intelligence, machine learning, data science and analytics to support the customer – making sure that the choices they make and the support they’re getting is right for them,” argues Aviva’s Jason Chambers, head of underwriting automation.

He explains that Aviva blends data and AI to give more accurate cover premiums while keeping the personal element of customer service. An example is how it uses flood mapping data, which is continually updated to provide the most up-to-date picture of the risk an individual property faces.

Insurers have large quantities of data and at times legacy systems have been the barriers or blockers to analysing this data. But, today with the growing number of insurtechs, sophisticated software vendors are supplying data analytics and mining various data sources to help insurers improve their offerings and communications.


For example, RSA is now able to analyse its live chat scripts to go deeper into referral reasons and queries, which it can learn from and develop propositions in light of this information. “This is tangible and quantitative insights from data that feeds directly into our thought and design processes,” says James Hibbert, SME strategy and implementation director at RSA.

 “As more of the world around us has been transformed through ‘datafication’, the dramatic increase in depth and breadth of data available has created new opportunities, as well as new risks,” contends Andy Roberts, head of analytics for Allianz Commercial.

“By interrogating the wealth of data, it’s possible to gain deeper insights into what has happened, and to make much more accurate predictions about what will happen. As an industry focused on risk, this is a very exciting prospect. It’s also important to recognise and manage the risks that can come along with it, both in terms of privacy and data ethics. At Allianz, for instance, we do not use social media as a data source.”

“To successfully embed a data strategy that benefits from the use of AI and big data processing, it’s key to establish upfront a data ethics policy that clearly sets out how a company intends to use data in a responsible and ethical manner,” adds Roberts.

Often it is the start-up insurtechs that have pioneered more customised solutions. For instance, insurtech Cuvva was among the first to sell hourly motor insurance as well as policies via a mobile phone app in 2016. This May it started offering rolling monthly cover. Unless details change, the same policy is automatically renewed at the end of the month like a Netflix or Spotify subscription.

According to Freddy Macnamara, CEO at Cuvva: “There are no deposits, interest or cancellation fees with a Cuvva subscription, and it has similar perks to annual cover in terms of comprehensive cover and a no-claims bonus after year one, but without the long-term commitment that comes with annual car insurance. It offers ultimate flexibility, giving customers far more control.”

He says the Cuvva app is proving particularly popular amongst Gen Z’s and millennials, who are largely underserved by the current market.

Partnership solutions

The big insurers are now often choosing partnership solutions to bring more personalised offerings to their customers. Insurtechs, for instance, can provide insurers access to their tech-driven insurance platforms without the risk and hassle of developing these themselves.

Bob Holt, product principle at Covéa explains: “We’ve invested so heavily in our new platforms partly because we want to partner with insurtechs and give them the means to be able to easily access our underwriting and other insurer capabilities. We can bring the insurance expertise and they the knowledge and insight, and so help them build an insurance product without them having to create an entirely new version.”

In 2018, Axa partnered with pay-by-mile insurtech start-up By Miles, underwriting its motor insurance policies. This May, Covéa also partnered with By Miles, which has seen a surge in policy sales during the pandemic. By Miles customers get access to Covéa’s comprehensive cover, paying monthly based on the mileage driven instead of a traditional annual premium.

Demand for usage-based or on-demand insurance products has soared since Covid-19 as more people work from home and drive less.

Another partnership solution shaking up the notion that a policy needs to be ‘always on’ is Allianz’ partnership with insurtech Dinghy, which provides adaptable insurance for freelancers. Acting as an intermediary between insurance underwriters and policyholders, Dinghy offers on-demand professional indemnity cover to the self-employed and freelancers. Dinghy enables them to turn off their insurance, saving money, when they don’t work.

Subscription services are becoming more mainstream as large insurers start introducing them. The first major insurer to offer one was Aviva when last December it launched a monthly ‘subscription’ service for customers buying home or car insurance.  Aviva Plus allows customers to change their cover as often as they want without incurring charges.

Previously, in November 2019, HSBC had introduced its ‘Select and Cover’ multi-insurance product for its customers, which, for a monthly fee, customers subscribe to a minimum of three policies from a range of seven. Policyholders can add and remove one option each year as long as they maintain at least three. Select and Cover is a non-underwritten product.

Despite their growing popularity, it is unlikely on-demand and subscription services will consign traditional products to the graveyard since some lines may prove unsuitable, like health and life.

Gig economy

Commercial insurance products have had to evolve in line with changing work practices and business models during the pandemic too. The gig economy has led to the need for more appropriate commercial cover for customers who have fewer tangible assets but more intellectual property and skill.  While, restaurants that became takeaways during lockdown, now have different risk exposures. Also, a significant number of start-up businesses have emerged with different requirements to more established ones.

Aviva developed propositions with brokers to enable customers to get faster responses as their needs changed during the pandemic and to provide cover reactively. “We learnt during the pandemic that when brokers and insurers work well together, we are really good at innovating around risk,” says Chambers.

According to Hibbert: “We are constantly looking at ways to improve how we can transact business digitally for brokers. For example, our business combined product includes a free-to-use online risk management consultation which is simple to complete. From just a few questions, we build a picture of the customer’s business and potential risks. Our expert advisors use this information to create a bespoke report, as well as being on hand for further advice.”

In conclusion, it’s important for insurers to keep striving to understand customer needs and expectations (empty properties, working from home, disrupted lifestyles) to ensure customers have the right cover or if there’s a growing demand that new products are created.

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