Will technology disrupt face-to-face insurance brokerage?

You’ve already heard all about it: the current health crisis has a profound impact on the way we work. You might have also heard that this impact is likely to linger long after the crisis is overcome.   

April 2020 – Overnight, remote work became the largest scale (forced) experiment in organisational management. And it is changing the way we think about our mobility as well. Do you really need to be present at that meeting? Can’t I just dial in and be just as efficient? Is the traffic jam worth the time saved if I work from home instead? All things considered; do we really need two cars in our household? Unsurprisingly, generation Z is ahead of the curve with a mindset viewing cars as a shared appliance rather than a prized possession, as several studies have shown. A great Belgian example of this is the success of Poppy Cars in Brussels and Antwerp.  Their mobile app gives access to on-demand services, from step, to scooter or car, perfectly tailor-made for the customer’s mobility need,

These new distribution channels (strongly personalised apps) offer services that tailor to the modern consumer. It requires new ways of insuring these services as well. If the trend of mobility-as-a-service keeps rising, a portion of the market for traditional car insurances will evaporate in proportion to this rise. This insight begs two questions. One, how can the insurance industry seize this change as opportunity? Two, what will be the role of the insurance broker in this new digital reality?

Looking for balance: digital game changers, traditionally distributed.

The answer to the first question is to keep moving. Evolve along the changes you observe in customer behaviour. Be wary of people who tell you to lock into one way of thinking. Take it slow, but steady. Rome wasn’t built in a day. Insurance is a business that has amassed a wealth of products, legacy systems and relationships. You cannot be expected to do a U-turn on a dime.

Taking a closer look at the full range of insurance needs, customers are still seeking tailor made advice. This brings us to our second question. Will the customer ever be fully serviced by an insurance bot? We believe that the answer is found in balance, an ideal mix and match of two worlds.

When everything is just peachy, and nothing goes wrong, most customers are fine with a fully digital process. But consider this, when your holiday gets canceled or your car breaks down, would you rather a person helps you, or you go through an online questionnaire presented by a bot? The human touch is most valuable when our patience is low, and our anxiety is high.

The balance, therefore, is this: Brokers assisted by technology on complex cases, technology assisted by brokers on simple cases. Technology will provide data-driven personalisation and the on-demand services. Brokers will provide emotion- and experience-based personalisation and individual guidance in periods of elevated customer stress. A powerful combination that can easily support modern insurance needs like on-the-fly insurance coverage, flexible retirement planning, home services and focused health services.

Platforms are the perfect tool to make this combination shine. Platforms provide interaction between all parties; customers, brokers and insurers, all while taking both behavioural and transactional data into account. In a perfect world, platforms are digital marketplaces for fit-for-purpose coverages and services, providing immediate delivery, facilitated by your favourite insurance broker.

Traditional insurance brokers have a role to play in this perfect world. Insurers, however, will need to invest in services and platforms that stand out among the crowd. The digital evolution can’t be borne by the insurance brokers alone.

If you want to dare the way you attack this challenge, or if you aren’t sure where to start, come and talk to us. We’re happy to help!

Wishing you all a productive day, and let’s end on a hopeful note by the eternal Winston S. Churchill.

‘The optimist sees opportunity in every danger; the pessimist sees danger in every opportunity.’