When it comes to delivering superior customer experience, the insurance industry is placed third behind retail (consumer products) and banking. A report on a cross-industry customer experience assessment by Capgemini and Efma—World Insurance Report 2018—revealed that while insurance is performing better than average, increased customer engagement efforts may lead to parity with front runners such as retail. With a score of 72.3%, the insurance industry trailed retail (consumer products) and banking, which garnered ratings of 75.7% and 74.5%, respectively.
Within financial services, insurance trails banking across various parameters such as overall customer experience, customer satisfaction, and being proactive. While 32.6% of Gen Y (individuals aged 18 to 34) and 34.8% of tech-savvy customers had a positive experience with their bank, only 25.7% of Gen Y and 28.6% of tech-savvy customers said their insurance experience was positive. In short, insurers must adopt emerging technology to leverage its customers and expand their business by breaking traditional customer-interaction limitations.
Digital channels are catching up with traditional channels. More than 55% of Gen Y and tech-savvy customers cited the internet as an important insurance transaction channel. Value-added services are being targeted by new entrants. As digitally-agile, multinational BigTechs gradually enter the financial services’ space, insurers must prepare to counter the challenge. BigTech firms such as Google, Amazon, Facebook and Apple have certain advantages and they can enter the insurance industry with new tech-based disruptive models. Customers, too, say they would consider buying insurance from BigTech firms, with 29.5% of global customers willing.
The report covers three insurance segments—life, non-life, and health insurance. It draws on research insights from 2018 Global Insurance Voice of the Customer Survey and 2018 Global Insurance Executive Interviews, which together covered 26 markets, including India.
Edited excerpts from World Insurance Report (WIR) 2018