Personal Line Insurance is very price sensitive. As mentioned before, Maintain a 20+% cost ratio It’s not feasible for insurance companies. What really cultivates customer loyalty beyond prices? And how can insurers compete to increase market share?
This blog explores strategies to enhance customer loyalty and retention, provides forecasts on the evolving risk environment for automobiles and home insurance, and how individual line insurance purchase behavior will be in the next decade Discusses Accenture’s predictions about whether it will change.
A changing landscape of individual lines is risky
Personal Line Insurance has evolved from a specialized product to a digital product. Initially, it was traded manually, but now it has become a digital product that is traded worldwide. With around 4 billion vehicles and homes worldwide, personal line insurance is a global product and a constantly evolving risk.
Risk situations vary widely between car insurance and home insurance. Auto Insurance covers a homogeneous risk profile with around 600 common vehicle models worldwide. The rise of electric and self-driving vehicles is restructuring road regulations and vehicle repair processes, introducing new risks requiring product liability and cyber coverage.
Conversely, home insurance covers uneven risk profiles with countless types of homes and building standards. The risk of the underlying home is greatly affected by extreme weather conditions that affect both the frequency and severity of the damage. It is fair to predict that extreme weather will not only affect valuations, but also affect building standards that provide additional price variables.
Housing and auto insurance represent key areas of personal insurance, but consumers are also dealing with the effects of massive disruptions – a volatile economic environment, the effects of the remaining Covid-19 pandemic, progress All of the technological revolutions in the area have significantly changed global dynamics. Today, there is a high need for consumer insurance, and the areas of risk that are most interested in are changing. We found it Cost of living and rising climate change were two top areas that consumers felt worried As for risks, and for not being protected.
Changes in the generation of insurance purchases
The core consumers of insurance are changing. First generation digital natives, millennials, have earned a Peak Insurance purchase year. Insurance companies must meet the unique needs of this demographic. There is a demand for more, better, faster services across all demographics. Consumers are willing to share data in exchange for specific, better experiences and products with their own needs being met quickly and easily.
Strategic areas for strengthening value propositions
- Brand identity in customer interactions: Make sure your brand identity is evident in all customer interactions and create a consistent, recognizable brand experience across all touchpoints.
- Ai-Augmented EmployeesInstead of focusing on implementing AI solutions, use AI to expand employees to provide more personalized and empathetic interactions, focusing on customers feeling deeply understood Masu. This is great, but with critical nuance.
- An attractive digital experience: Create a digital experience that promotes emotional connection. Travel insurance, for example, can significantly increase customer engagement by providing dynamic updates on extreme weather, top tourist attractions and local health advisors. Traditional risk mitigation notifications do not encourage emotional connections with customers.
- The real benefits of digital adoption: Customers recognize the tangible benefits of adopting digital channels, such as significantly faster resolution and personalized digital interaction, making digital shifts valuable.
Creating an engaging digital experience for your customers is key to enhancing customer loyalty. Recently, we worked with insurance companies to address low engagement between agents and customers, insufficient customer information, and lack of visibility to manage leads. Insurance companies and Accenture have deployed AI-enabled apps to their customers. The app is very intuitive and built using a scalable design for market adoption across Asia. The solution provided automated customer relationship management, marketing content recommendations, recommendations for the following best actions, customer insights, 360-degree customer insights, and agent performance management.
result? With premium growth of 424% and a pipeline of 671%, the attractive digital experience proves that gold is worth its weight.
Shift in consumer purchasing channels
Traditional methods of purchasing insurance through brokers and agents are expected to decline in favor of direct sales and embedded insurance models. Munich Re Embedded insurance is projected to grow at a CAGR of 25% through 2030, potentially accounting for gross premiums worldwide in the P&C line of more than US$500 billion.
Consumers are showing growing interest in embedded insurance offers, where associated risk protections are integrated into purchases. For example, the share of consumers who are more likely to buy car insurance from car dealers has increased from 32% to 42% since 2018. Consumers are also looking for solutions beyond traditional home and auto insurance bundles, such as complete home buying and home monitoring services.
Key areas for insurance companies
- Performance and efficiency: Develop the most suitable features and products.
- Experience and convenience: Delight your customers with exceptional service.
- Solved and not sold: Create value for everyone while playing a role related to the lives of our customers.
As insurance situations evolve, we must continue to leverage the power of AI to turn challenges into opportunities. Empowering businesses with AI-driven solutions not only create tools, but also turn possibilities into measurable success. This journey of innovation redefines what is possible and confirms that the future of insurance is not merely anticipated, but is actively shaped.
