At Corporate Insight, while tracking the ever-changing property and casualty insurance landscape, it is easy to see how technology impacts the customer experience and how firms adapt. Innovation has been centralized around the mobile experience in recent years, but with the development of new technologies—such as Amazon Alexa voice-recognition technology, for example—firms continue to explore methods to get an edge over their competition
In a recent white paper from Dig In—Turning Data into Revenue: How P&Cs Can Profit from Digital Disruption—the author argues that the monetization of data and more efficient go-to-market processes are two keys to future success in the P&C sphere. The piece contends, “If a start-up can make itself worth $1 billion in five short years simply by cracking the digital code for selling razor blades, insurers can certainly raise their own market value by doing the same for P&C-related risk.”
Let’s consider the first proposed key, that new business models must learn to monetize data. The use of telematics is nothing new to P&C firms, and those with telematics programs benefit from not only encouraging their clients to drive safely but also collecting the programmed cars’ data. One example Corporate Insight has observed in the P&C space is Metromile, a firm that has implemented a new business model that threatens to blow up the status quo by capitalizing on data with its pay-per-mile system. Having as much of this data as possible also provides firms the analytics they need to properly price their coverages and monetize their packages. This model not only provides companies data but also appeals to clients, as it provides them more control over how much they end up paying, whether it be by driving less or more slowly and not just by avoiding accidents or tickets.
Amazon Alexa Devices
The white paper’s second key—nimbler, more efficient digital go-to-market processes—is where firms fall flat, notably with recent technology such as Amazon Alexa. This is absolutely the type of technology firms should be looking to capitalize on—per Dig In, Gartner predicts that, by 2018, 30% of human interaction with technology will be done via conversations with smart machines—but those firms should also be cautious about moving forward with the app. For mobile enhancements, such as Touch ID login and 3D Touch menus, firms would be wise to add them to their platforms as quickly as possible. However, as of now, the Amazon Alexa technology is still somewhat limited and is best used for activities like listening to music. Firms that have added Alexa apps currently have simplistic features, with capabilities limited to asking for agent or billing information. Liberty Mutual’s app does offer the unique feature of connecting to a resource center, allowing for practical in-home use. Yet despite the importance of having expedited go-to-market processes for some technologies, firms who do not yet have Alexa apps should ask themselves if rushing to create an app just to have one is better than taking their time and creating one that will be of actual use to clients.
The future of the P&C landscape may be unclear, but the path there is through creative and practical use of data and technology. The user experience is changing, and it is up to P&C firms to cater to this experience while also monetizing their offerings.