How tech can help restore customer trust in insurers

The financial services industry has taken a big hit when it comes to consumer trust.

By Martin Stewart : 24th of December 2020

In the aftermath of the Banking Royal Commission, a third of Australians say they’ve lost trust in their banks, and that has serious flow-on repercussions for related companies like insurers.

Scandals within the financial services sector have made customers pretty nervous. Entire livelihoods, life savings and personal protections are tied up with companies that people no longer feel they can rely on. From the customer’s perspective, the onus is firmly on providers to safeguard against future breaches and protect their privacy.

The next step for insurers has to be restoring trust through far more transparent and reliable processes – and that means investing in their tech.

Obliterate human error with automation

Subjectivity is a huge issue for insurance customers. In the wake of the commission, they are likely to suspect that an insurer will offer the same product at different prices, give preferential treatment to certain customers, or go out of their way to avoid paying claims.

Automation takes away guesswork and misapprehension for both the insurer and the customer. Having automated systems in place:

Create autonomous systems that learn through AI

Bringing artificial intelligence and machine learning into the mix means your processes can be shaped more reliably, automatically, and in real-time. Humans will no longer make subjective decisions based on limited facts. AI can take actual data, customer behaviour and predicted outcomes to improve product offers, streamline processing and provide a better customer experience.

Self-serve portals – web, phone apps, and chatbots – can guide customers through their policy applications and claims processes, so they feel in control.

The combination of automation and AI means customers can rest assured insurers are achieving (meeting) the regulatory guidelines and treating everyone the same way. At the insurer’s end, policy writing and claims can be processed at speed, eliminating the need for human intervention in all but the most complex cases.

Implement a better mix of security measures

Security breaches were one of the major concerns to come out of the Royal Commission. To move forward, insurers need to be increasingly innovative in the way they manage and treat data.

Cybersecurity is a massive market – PWC estimated companies will pay $7.5 billion for cyber insurance in 2020. Insurers might be at risk from a range of attacks, including malware, spam, denial of service attacks, botnets and so on. And while the IoT has streamlined the whole business, connected devices can expose insurers – and their customers – to extra risk.

Trust comes from transparency. Insurers should show customers they are exploring new ways to keep their data safe, leveraging tech like sensors, intrusion monitoring, closed end points, machine learning and behavioural analysis to stay ahead of potential attacks.

Agile processes will make you more versatile

Insurance works best when it can respond to a changing world. New policy demands and unprecedented claim types will continue to grow, and customers will be looking for insurers that can respond quickly to their unique needs.

Shifting to more adaptable systems means being able to react. With a system that is highly configurable modules that can be assembled to create a bespoke system.

Having real-time data makes it easier to manage risk to customers, and be proactive in solving their problems.

An agile environment allows insurers to rapidly incorporate new business rules, policies and strategies, so customers know they’re always getting the most up-to-date service.

Using tech to improve customer experience and loyalty

Customer experience expectations are growing, both face to face, and online. Creating positive user experiences will cement trust in the long term.

We saw this in action when we helped a large New Zealand bank put their customers first. They knew their manual application system was time-consuming, and that was reflected in poor conversion rates. The answer: let customers complete applications digitally, in their own time. Now, it only takes one day to issue over 60% of policies that don’t require further information.

Customers love easy processes on familiar systems. Insurers might look into seamless integration across multiple devices, with self-guided applications and claims. Highly-targeted automation can reduce wait times, cut down queues and provide more accurate information before ever reaching a human, freeing up assessors to focus on customers with more complex claims.

Leveraging tech to create great customer experiences – and reinforce their loyalty – is about knowing what they need, and that’s different for every business. You might even have the data you need already. Analyse customer behaviour like drop-offs and exit points, viewing times, call wait times and so on. Learn from their behaviour and shape your systems to suit their needs.

After the Royal Commission, insurers will have to work harder than ever to restore trust. Innovative tech should be a non-negotiable for insurance companies, not only to create more transparency now, but to build versatile systems that can change as needs change.

Customers are extra sensitive to being kept in the dark, and they are more willing than ever to do the research to find a better provider. They expect transparent processes, simple administration and a fair and equitable system for all. Smart use of tech can take them there.


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