Personalisation is the order of the day when it comes to service provision in today’s world, and insurance is no different. Consumers expect their insurance companies to be aware of their circumstances and preferences in the same way as Amazon or Booking.com and to tailor products for their specific needs.
And the industry is responding, according to Pinsent Masons partner Naoise Harnett. “The insurance industry is attempting to move away from purely transactional relationships with their customers focusing on bills, payment, renewals and notices,” he says.
“Instead, the insurance industry is attempting to meet the demand for personalised insurance services by moving towards personalised relationships where customers provide their personal data and in return receive personalised customer experiences. The personalised relationships are based on customised features and risk assessments based on matters such as driving patterns, safety reminders, health tips and loyalty programmes.”
Hiscox Ireland offers a tailored service to its customers. “We try to identify sectors and provide the full suite of covers for the customers in that sector,” says managing director Richard O’Dwyer. “For example, if the customer is a technology client we understand that they will have numerous different exposures that they will need covered to protect their business: professional indemnity, management liability, cyber, public liability, employers’ liability, property, in addition to a few others.”
The Hiscox product offering is modular and allows the customer to add these various covers onto one policy rather than having to purchase multiple policies and review them all separately. “This is quite unique in the insurance market and is one of our main differentiators,” says O’Dwyer. “We also look to extend the broadest cover for customers where we see the majority of claims. Continuing with the example of technology clients, our data shows that most of their claims come from breach of contract issues. As a result, we have extended this cover to be clear and to have the broadest cover available.”
123.ie is another company with personalised offers for customers. “123.ie is a digital business for a digital generation,” says managing director Niall O’Grady. “We recently launched our new brand campaign, ‘give better a try’, which plays to the innovation theme and is built on the insight that, as people, we all respect people who try to do things better.
“The campaign encourages customers to check us out, but also sets high standards for our people internally, to always look for alternatives that are better for each customer.”
Advent of technologies
The advent of technologies such as telematics is key to the provision of personalised products, according to O’Grady. “We are a technology-led business and last year we became the first leading direct insurer to launch full-service telematics technology for younger drivers. It prices the insurance policy to individual customers’ driving habits. 123GO is aimed primarily at younger drivers – it is the perfect example of how technology can deliver a better experience while also promoting safer driving. It works via the installation of a small black box in the car which monitors driving, recording information on speed and it then prices accordingly. So young drivers who drive well no longer subsidise those who don’t.”
And sharing such data is not necessarily a problem for customers. “Our experience is that customers are happy to share their information because they know they may benefit from reduced premiums,” O’Grady notes. “Not only does it incentivise them to drive safely, it also rewards them accordingly. 123.ie deploys best practice in terms of protecting customer data, therefore we believe our customers are also happy to share because they know they can trust us to look after their data properly.”
Convenience is only one of the benefits of personalised insurance products, as Harnett points out. “Most important from the customer’s perspective is the benefit in terms of price. Rather than the antiquated methods of assessing risk which apply a one-size-fits-all mentality to certain categories of insureds, personalised insurance uses non-traditional sources of data which are unique and specific to the particular risk to identify a personalised perspective on each and every risk.”
Commercial customers can also benefit from efficiencies as a result of bundled products, according to O’Dwyer. “The primary benefit of having all covers with a specialist insurer that knows your industry is that you will not only be covered for each different risk exposure that your business faces, you will also avoid the issue of two insurers dealing with different parts of the same claim,” he explains.