By: Elisa Logan, Vice President Marketing
The pace of digital innovation in the insurance space demands that companies adopt technology innovations to prevent themselves from being disrupted. But hypersensitivity around protecting the policyholder experience is holding many P&C insurers back.
Why? Because consumer trust is easy to lose. Only 29 percent of consumers say they trust insurers, according to the Accenture Trust Index. And if insurers experience incidents, such as a data breach, policyholders’ trust erodes quickly —and that comes with a cost. Among 25,000 consumers who switched companies across industries in the past year, 46 percent did so because they lost trust in the company.
Most P&C insurers are slow to make big plays around digital experience due to their desire to protect policyholders’ trust. That fact, coupled with the challenges of digital transformation and cybersecurity threats, leave insurers vulnerable to big-dollar losses. But increasingly, policyholders want real digital functionality. A J.D. Power survey found most insurance companies’ digital offerings fall short when it comes to delivering basic insurance capabilities, like processing claims and enabling consumers to shop for and service their policies.
P&C insurance companies that hesitate in moving toward digital leave themselves open to disruption from startups with little insurance experience. They also risk not giving policyholders’ the type of experience and convenience they’ve become accustomed to with companies like Amazon, Uber, and Netflix.
Next time we’ll provide some strategies to help you create a robust digital approach with minimal policyholder disruption. In the meantime, check out the latest Insurance Innovators Unscripted podcast: Innovating Claim Payments, where VPay CIO, Kris Herrin and host Abel Travis discuss considerations and strategies for insurers looking to innovate their claim payment process.