2020 pressured insurance companies to make quick technological changes, from remote work for staff and agents to remote distribution options for customers. As the pandemic lingers through 2021, we’re seeing insurers, agents and customers all gaining increased comfort and familiarity with digital communications, including insurance distribution.
Customers still value the help of experienced insurance agents and insurance company staff. They also value the benefits of convenient digital connections to insurance, whether it’s reaching their insurance agent or having the opportunity to place coverage on a major purchase at the point of sale. 2021 demonstrated the need for insurers to blend these two approaches.
Remote distribution exploded in 2021. The pandemic pushed both customers and carriers into remote environments while also underscoring the need for property and casualty insurance coverage.
Needing coverage but unable to meet with agents in person, insurance customers went online. The insurance companies already prepared to meet customer needs in a digital environment experienced some early benefits from the change, but other carriers have quickly caught up.
Customers were willing to visit insurers’ and agents’ websites, and to use tools like AI-enabled chatbots and video calls, to purchase coverage. Customers were also ready to embrace insurance options in new contexts, too. Embedded insurance expanded in 2021, pairing non-insurance companies with insurers to provide coverage at the point of sale for many customers. The convenience of this relationship, enabled by shared technology, laid the groundwork for both insurers and non-insurers to build stronger customer relationships.
Embedded insurance became one way to connect customers to coverage at the crucial moment. As 2022 begins, insurers are pushing the envelope on embedded insurance. They’re turning platforms and apps into full-fledged digital destinations, where customers can handle a range of insurance-related needs at once, from extending a warranty to buying a house or car — and the coverage they need with it.
Remote work also became familiar in 2020 and 2021. Today, many insurance agents find that they can do their jobs effectively in a remote environment, as long as they have the right tools. A platform that seamlessly connects customers and agents, for instance, can provide the information agents require and the connection options customers need, leading to the placement of the right coverage for the right customer.
Even as vaccinations make it easier for people to resume in-person activities, insurance agents find that digital communication options remain an important way to connect with customers. Insurance platform tools and other options allow independent agents to communicate more effectively, building long-term relationships and fostering customer loyalty. These tools are becoming a regular and essential part of agents’ toolkits.
Insurance can be complex, and most customers aren’t insurance experts. Many insurers are aware that effective service, especially from qualified insurance agents, is essential to building strong customer relationships. In a Deloitte survey, for example, 57 percent of responding insurers said the most effective way to maintain customer loyalty is to provide access to friendly, knowledgeable human assistance when the customer needs it, write David Rush and fellow researchers.
Human assistance also helps provide the personalization and customized coverage customers increasingly need and want. The COVID-19 pandemic drove home the need for coverage for many customers. Yet their experience with other online shopping options has led customers to expect that insurance, too, can and should be tailored to their needs.
Personalized service and customized coverage play key roles in the quality of life customers experience when buying insurance, particularly when they do so in a digital environment. When customers can provide essential information securely and have their questions competently answered, they’re more likely to be satisfied with the service they obtain through a platform and the resulting coverage.
2021 saw increased interest in tailored coverage for property and casualty insurance customers. Stay-at-home government orders, for example, turned many office commuters into remote, at-home workers, raising questions about the need for ongoing insurance coverage for a vehicle that simply sat in the garage. In 2022 and beyond, we expect insurers to embrace the tools needed to analyze the data required to provide this type of custom coverage.
The insurance digital revolution didn’t begin in 2020 or 2021. Yet it experienced rapid development during that time. We predict that 2022 will feature some of these changes becoming the new normal for insurance, and driving future technological advancements for carriers, agents and customers.
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