There are different synonyms for the upheaval that is currently impacting all sectors in Germany. Brick-and-mortar businesses speak of an apocalypse, and in other segments the transformation of relationships between companies and customers is described as disruptive, at the least. With artificial intelligence, insurers hold the key to meeting consumers' current expectations.
The millennial generation has long grown up. Online shopping, just like organizing life on a smartphone, is a habit for them. Modern technologies and services play a stronger role in everyday life of older people, too.
Customer expectations have changed enormously in recent years. Ordered online today, delivered this evening; get a new rate on mobile communication with a few clicks of a mouse or use media on demand – Amazon and Netflix are symbols of absolute focus on customers and a smooth buying and brand experience.
The experience of a brand should be immersive, according to US marketing experts. Just as currently experienced by the commerce sector, where brand manufacturers are competing for access to customers, insurers will be challenged by insurtechs and fintechs.
Commerce and tech groups are managing to maintain dialogue with customers. As soon as consumers purchase something from Amazon, they receive an e-mail with product suggestions or additional offers. Netflix users regularly get recommendations of films and series that they may enjoy. This is all about contact with customers and attracting their attention. Many insurers still have something to learn from this.
In the past, the only touchpoint with the insurer was the claim submission by the insured. This is no longer enough. More touchpoints need to be created to become visible and remain in the customer's memory. This can be done with additional services and added value. For example, a contract manager can remind customers about notice periods and show the contracts of other companies. Additional services relating to the smart home, travel or car are also conceivable.
The creation of as many touchpoints as possible through various channels is not enough in itself. Customers expect also a positive experience, and artificial intelligence can be of help with this. Chatbots allow insurers to be available around the clock, at a fraction of the personnel costs of a 24/7 call center.
Modern consumers do not care about department responsibilities and business hours. They want to get in touch with the insurer whenever they feel like, using "their" channels, be it for a routine question, a specific problem, a change of key data or a claim submission. A Chatbot, controlled by voice input or keyboard, takes over the tasks of first-level support.
Such systems have two components, on an abstract level. On the one hand, there is linguistic technology. It allows the bot to "understand" the customers and their entries. On the other hand, there are the technical components. The system does not only have to "know" how to handle a claim submission and which parameters are requested for processing. To provide a suitable offer, the system needs to identify and meaningfully combine existing data and contracts. This is hardly possible without AI.
A few days ago, the cosmetics company Shiseido launched a skincare series that creates personalized skincare for consumers at home via the app, facial recognition and AI. It is updated every day and takes into consideration weather and sleep behavior data, among other. There is not just one "Optune" product, but countless variants of it. This example impressively highlights that the era of standard products and the motto "one size fits all" are over.
Extrapolated to the insurance industry, this means that the future belongs to market participants that offer their customers personalized and customized offers and rates. Telematics rates or individual services in the area of preventive healthcare are the first signs of a huge shift.
AI and machine learning are the key to creating such offers. Analyses in product management and marketing help identify target groups and customer segments. Artificial intelligence determines coverage gaps and customer needs in seconds, enabling the development of suitable coverage concepts. Current information will be evaluated by machine analyses to calculate individual risk factors or adjust rates to the customer's respective life situation.
Public perception of artificial intelligence is shaped by spectacular reports about self-driving cars or defeated grandmasters in games such as chess, Go or poker. In practice, the revolution in the IT world is happening rather quietly. Systems for machine learning and predictive analytics work invisibly for most people, whether in claims analyses, fraud prevention, as a backend for chatbots, or in telemetry data evaluation.
But one thing is indispensable. These systems are useful only if data flows freely and information is exchanged. This applies also to the networking of different touchpoints. Data is neither the new oil, nor the new gold, but it remains the basis of cutting-edge and excellent customer service.
Insurers can create the foundation for this with our solutions.