‘Quiet revolution’ in technology innovation changing insurance distribution: Swiss Re

There is a “quiet revolution” occurring in the way consumers interact with insurers, as technology has helped fuel customer centricity in distribution, Swiss Re says in its latest sigma study.

 The internet and mobile devices have allowed consumers to research and purchase insurance policies without relying solely on intermediaries, the analysis suggests.

Aggregation and price comparison websites, along with social media, are increasingly important to pre-sales, according to Swiss Re.

“Relatively simple” insurance products, such as personal home and motor and property insurance, are also becoming increasingly available to purchase online.

The same is true even in emerging markets, such as Asia, where intermediaries still account for most sales but insurers are investing in direct online sales platforms.

“A quiet revolution is underway,” Kurt Karl, Swiss Re’s chief economist said in a statement

“In many countries the share of premiums accounted for by online sales is still small, but it is rising. The statistics on e-commerce insurance mask the profound impact new technologies are having on the distribution process,” Karl noted.

Developments in “big data” are also allowing insurers to improve their sales and marketing strategies with more data analysis of customer behaviour.

The role of intermediaries will also still exist, Swiss Re notes. “Many consumers will continue to value the personal interaction and expert advice of agents and brokers, especially for complex commercial and life and health risks,” it says.

“The challenge for intermediaries and insurers is to adapt their business models to meet the varying needs and preferences of customers.”

Innovation and experimentation, and the ability to harness and analyze data, will be key for companies hoping to remain competitive going forward, Swiss Re adds.