<strong>Issued by HWB Communications (Pty) Ltd on behalf of African Unity.</strong>

As digital disruption continues to change the game in the insurance industry, insurers are revising their business models in order to stay relevant with consumers. Mass customisation is just one way to achieve the desired outcome.

While this might sound like a paradox at first, mass customisation can drive customer loyalty by identifying different customer profiles and then developing or enhancing products to meet their specific needs.

An Accenture survey of the South African short-term insurance industry revealed that customers want to interact via various channels, with younger consumers showing a preference for digital channels while older consumers prefer a phone call and middle-aged consumers opt for a combination of the two.

In an age where consumers are bombarded with messaging from insurers, there is an opportunity to customise their experience by anticipating their needs and pre-empting them. For example, by sending a reminder letter to a client whose premium is about to come up for annual review and prompting them to check if they require an update to their life insurance policy.

It can also mean improving the customer experience by ensuring that the business touchpoints match those required by the client. Maretha Spies, Chief Operating Officer at <a href="https://www.africanunity.co.za/" target="_blank" rel="noopener noreferrer">African Unity</a> (AU), notes that the need for interaction with insurers is often product driven.

“These  touchpoints include retail shops, websites, mobile applications, offices of intermediaries and partners, chat bots, social media such as Facebook, and telephonic calls. Medical products, for example, see more frequent interaction between clients and the business as the client changes or adjusts their medical insurance options depending on their family’s needs. When it comes to life insurance, on the other hand, we often have less frequent interaction with the clients – from the point of policy inception and most often, this is followed by a claim or when the client makes a change to the policy such as changing beneficiaries or adjusting the life assured sum,” she says.

But it’s not only about how consumers access insurance – the emergence of social media has changed the game for both advertising and customer engagement. As on-demand television becomes the norm, advertising has shifted from the television to online platforms such as YouTube and Facebook. The power dynamic has also shifted firmly to the consumer who has the option skip an advertisement after just five seconds; or to set their preferences on Facebook to either include certain advertisements or filter advertisements.

The PricewaterhouseCoopers (PwC) Africa Insurance Survey of 2018 notes that a new generation of consumers is emerging. The report says that the “digital native” is looking for mobile access, omni-channel access, speed, paperless transactions, transparency and remote advice.

“Insurers now have to anticipate changing customers’ needs, providing more customised solutions,” the report states. Spies says AU firmly believes in driving digital touchpoints together with its intermediaries.

However, she notes that as technology continues to evolve at a lightning pace, insurers need to ensure that both the partners and architecture they select to engage with are advanced enough to take the company into the future. “If companies don’t select the right designs to provide flexibility and integration possibilities, your investment may fail to provide the desired return on investment (ROI),” she warns.

Spies also notes that it is worth taking time to evaluate industry changes without buying into media hype.

“For example, a few years ago, we saw the introduction of increased technology and there were a number of claims that tech was about to replace brokers. However, in the field, we have seen that technological engagement with consumers has seen a better take-up when driven by brokers and intermediaries.

“While technology has definitely changed the game for insurers, most clients still want and need the personal touchpoints and it is only by marrying the two that insurers will achieve the optimum client engagement that they are seeking,” Spies concludes.