The future will belong to insurers who can invest in owning and analyzing data
Digital revolution has disrupted business practices across India and the insurance industry has been no exception. With internet penetration rising at the rate of 18 per cent annually, digital technology has improved several aspects of the insurance business such as customer touchpoints, transparency in product features, service availability and payments.
There has been a spike in digital adoption by insurers over the last few years. It has affected the overall approach and servicing of insurance products for end-users. Adoption of digital technologies has worked as a win-win situation for both insurers as well as the customers.
For insurers, digitalization helped increase reach and in reducing operational cost. For customers, it facilitated transacting at their own convenience with security.
Changing preferences of modern customers
Modern customers have evolved with e-commerce and various everyday utility apps. There is a clear expectation in terms of simple, customized and readily available products or services, using handheld devices 24 hours a day. Access to financial products cannot therefore be any different. Today's challenge is to provide enhanced customer value, ensuring high customer satisfaction through digital means. User-friendly digital means with faster processing will help retain customers in the long term.
Understanding customer better
Modern customers in this digital age expect agility alongside ease of use. Digital technologies act as an enabler to make data-led analytics understand customers better. Customers today expect the ease of interaction with the brand. Empowering customers with easy and intuitive experience goes a long way in creating value.
In days to come, customized products that meet customers' needs and preferences, introduced at the right time, will enhance a company's credibility.
Redesigned customer journey
Digitalization has completely revamped customer communication, and the insurance sector is no exception. Enhanced digitalization through various channels has led to improved access and user experience. Services are available round the clock just at the touch of a button. Success does not only depend on the digital tools provided to the customers, but the experience those tools enable. Smooth and transparent experience ensures and inspires customer loyalty. The journey ahead must continue to allow customers to carry out seamless conversations with financial advisors through their preferred channel and make an informed purchase decision offline or online.
The road ahead
The insurance industry has grown substantially over the past decade. The current need is to build and sustain a systematic approach that chalks out the entire journey from data model designs to organizational changes required to maintain operational excellence.
Digital technologies have given access to ever-burgeoning data. This can lead to penetrating insights and help the insurance industry further evolve and make it an enabler for customer experience. The future will belong to insurers who can invest in owning and analyzing data. Those playing the role of "risk avoidance" rather than "risk mitigator" will be ahead of the rest. Insurance companies that move forward swiftly and decisively with innovation at the heart of their strategies will have a competitive advantage.
The author is Head – Information Technology at SBI General Insurance