The outbreak of the coronavirus has impacted nearly every aspect of our day to day lives, and the insurance industry is no exception. For better or worse, some of these innovative changes are certainly going to stick around long after the pandemic has been contained.
Read on to understand how insurance companies will need to digitally transform their business in order to adapt to the rapidly changing market and thrive in the new normal.
1. Insurance has been slow to adopt digital technology
It is no secret that (thus far) the insurance industry has enjoyed the privilege of staying outside of the digital wave that swept up many other industries years ago such as software, finance, or entertainment.
People no longer print concert, movie, or even airline tickets, they have an app on their phone for that. All the while, insurance companies continue to mail out policy packets and insurance ID cards when open enrollment or renewals come around.
You can buy and sell stock with a user-friendly interface, while many adjustments to an insurance policy require (at the very least) a phone call and a one-on-one conversation with an informative agent.
While software companies have been hard at work digitizing so many aspects of our lives, insurance has held on tight to “enrollment day” fairs at the workplace and other personal, face to face sales tactics.
Digital adoption has been slow coming as both consumers and companies were willing to accept the old idea that insurance should be a ”clunky” process. Finally, that perception is poised to change quickly in the coming months.
2. The COVID 19 crisis is accelerating and forcing change
With the outbreak of the coronavirus in March, staying at home and working online has become the standard in these unprecedented times. In a matter of weeks, schools, businesses, and individuals were forced to find creative and effective ways to overcome the obstacles created by the necessity of quarantine and social distancing. As the pandemic continues, many companies are realizing that some of these solutions are also cost effective and beneficial in a multitude of ways.
2.1 Enrollment day will never be the same
Though in the past few jobs allowed the “work from home” option to their employees, at least not on a regular basis. It was generally assumed that working from home would allow a significant decrease in productivity and quality, resulting in a waste of time and resources.
However, now that essentially everyone who is able to is working remotely, companies are realizing that it can be both affordable and highly effective.
With the potential to eliminate the overhead cost of hosting a large number of employees in a brick and mortar building, it is very likely that many companies won’t be going back to the old model even after they have the green light to return to the office at 100% capacity. The need for lifestyle benefits at the office will decrease as the benefits to working from home are embraced by the workforce.
In this chain reaction, insurance companies will be significantly impacted when it comes time for enrollment day—which will likely never look the same again.
If employees will not be meeting with you or your representatives face-to-face as they consider their options for insurance, they will begin to rely more and more heavily on the insurer’s digital presence to make their decisions.
3. New technology must focus on user experience
While many Insurtech companies are focusing their energy on Artificial Intelligence and Machine Learning in order to resolve claims and questions for existing customers, very few are concentrating on the user experience that will draw in (or repel) new clientele.
This is a massive error. More and more, the success of new technology in business will hinge on a pleasant user interface experience right from the beginning.
3.1 Mobile friendly
As the cell phone in our pocket becomes more and more powerful, the necessity for a full-sized computer or laptop screen diminishes. It is a fair assumption that not everyone will have a laptop, but they will almost certainly have a phone.
In either case, the accessibility of making a policy adjustment or following up on a claim from a smartphone will drive customers towards companies that have not only an appealing desktop website, but a convenient mobile site or mobile app as well.
3.2 Self-explanatory enrolment options
Without the benefits of having a knowledgeable salesperson who can have a face-to-face conversation with potential clients at an enrollment fair, you must convey the same technical information in an equally clear but additionally concise manner, allowing the customer to successfully navigate their options for insurance plans and voluntary benefits on their own.
By utilizing a visual aid such as a decision matrix displayed in an easy to read format, clients will require no further explanation of their enrolment options. Making these options clear and available for customers to digest at their own pace will allow them to feel more confident in their decision in the long run.
3.3 Embrace digital delivery
With the fast-paced world that we live in today, people don’t want to wait for their membership cards to arrive in the mail. Many insurance companies have already been adapting by offering a digital delivery of insurance cards, but moving forward, it will soon be seen as more than just a convenience—it will become a requirement.
3.4 Empower customers with choice
Giving your customers the power to make decisions makes them feel more in control, so they often want more than just one or two options for everything. If the process for picking out their insurance plan is completed step by step with interactive questions along the way, they will feel more confident in their decisions than if they are merely given a red pill or a blue pill and no option but to swallow one or the other whole.
If you do not give them the power to choose preferences within your plans, they will make the choice to go with another company who provides them with more options.
4. Change is inevitable
Although there will be lots of change as we continue to navigate these trying times, you have the power to adapt and grow your business through it all. Although it may be scary at first, our team is here to help you succeed and embrace the inevitable changes coming our way.
Please reach out with any and all questions, we look forward to speaking with you.