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Digitisation increases insurance sector competitiveness

Sibahle Malinga
By Sibahle Malinga, ITWeb senior news journalist.
Johannesburg, 22 Feb 2016
Clients' omni-channel approach creates a competitive environment for insurance companies, says SAP Africa's Darrel Orsmond.
Clients' omni-channel approach creates a competitive environment for insurance companies, says SAP Africa's Darrel Orsmond.

The digital economy and the Internet of things have changed the way the insurance industry is able to anticipate and respond to clients' needs.

This is according to Darrel Orsmond, head of Financial Services at SAP Africa. Orsmond points out potential clients, aside from being more aware of insurance products, are able to conduct in-depth research from any mobile device connected to the Internet.

He adds this translates into a more competitive environment for the insurance companies offering services as customers utilise the omni-channel approach.

He notes more consumers don't have access to personal computer Internet and they rely on their mobile phones for Internet access, which means virtually all insurance-related content has to be available on all types of devices.

"Various digital and physical touch points are being utilised throughout the consumer's insurance purchasing process.

"Clients tend to use their phones, tablets and the Internet interchangeably depending on when and how it suits them, so they might receive an offer or respond to an ad on their phone, and then use their tablet to search for similar offers and finally make a choice through completing an application on the Internet."

He explains when a customer completes or responds to an offer via the Internet, they expect the call centre, (or a branch) to have their latest completed information when they call them, and a chat response to be fully updated on where they are in the process.

"This is a basic requirement in the modern world," he says.

Orsmond highlights some strong points made by Bob Cummings, global head of Finance for SAP, at the Financial Services Forum held in London in June 2015.

Cummings explained how financial services will move from a product-based industry to a customer-protection industry by creating a customised product base.

Cummings unpacked the new approach to insurance, explaining that insurance companies wanting to move into the future as effortlessly as possible should be aware of everyday changes in technologies, and that customer perceptions need to be monitored and anticipated.

He added that customers are not as complacent as in days gone by - they are tech savvy and know what they want.

"Insurance companies need to embrace technology and use it as a stepping stone into the buying process.

"Consumers are able to login using their social media credentials, providing access to invaluable information, while online chat capabilities give the feeling of being heard, all of the available channels and elements of the process must be utilised by insurance companies," revealed Cummings.

Talking about how clients' perceptions can be monitored using technology,Orsmond says much can be learnt by the responses of customers to messages, offers and other marketing triggers.

"Information such as which customers and how many respond to a direct offer versus an encouragement to respond, and why?

"How many and which customers go to the landing page of a Web site and then progress and which customers abort browsing immediately and why does this happen," continues Orsmond.

He explains answers to these types of questions give great insights into how customers think and behave.

Discussing how social media can be utilised to source client information, Orsmond says social media provides a wealth of information about what products, price and features are trending and what's new.

"Social media can reveal crucial customer information such as who supports and doesn't support new products and what are good offers and features that are interesting for consumers," he says.

All of the efforts of an organisation should be geared towards getting customers and potential customers to take the next step and consume more and more of what the insurer has to offer.

According to insurance company CoverHound, social media has allowed insurance agencies to connect with their customers in a different, more informal space. It has allowed issues to be resolved that might not have been addressed before.

The company says social media has also given insurance agencies a new medium to inform customers about products and services offered while allowing insurers to learn about and meet customer expectations.

"Big Data also lets companies see which clients are at risk of cancellation and which are happy overall with the service they receive. This helps them to focus on the customers who are more likely to stick with the company," explained CoverHound.

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