There has not been much discussion related to the topic of "Bancassurance" for a long time. But now banks are developing a new appetite for insurance. Fintechs and regulation play a big role in this. The question is simple: Why don't insurers take matters into their own hands?
A few weeks ago, Deutsche Bank caused a stir when it announced that it would be using a white-label solution from fintech firm Friendsurance. Using the manager for liability, household, legal protection, and homeowners insurance, quotes can be compared and concluded directly via the institute's app. In other words, Deutsche Bank is becoming a broker for property insurance and is thus also competing against the applicable comparison sites.
The goal is obvious: the bank wants to secure its market share in the digital insurance business. And right when it began its new offering, its expansion to include life and health insurance was announced.
Deutsche Bank would like to support its customers in this field, even in the event of a claim. If such a case occurs, help is available both in the app and by phone.
Convenience as a world power - customers like it easy
Sascha Lobo once again used the term "convenience as a world power" in his talk at the Transactions 2020 industry meeting. Customers want to manage their financial affairs quickly, easily and efficiently. So it's best to just use one tool or go with one vendor. It could hardly be more convenient. And the bank creates an important added value, which - if the calculation works out - also makes customers less prone to switching providers.
For the time being, it is a good thing for insurers if applications are policed - for the time being, irrespective of the way by which they reach the companies. What is less pleasing, however, is when another third party, Deutsche Bank, comes between the insurer and the insured.
It is a head start for banks, but not an uncatchable one
Bisher Until now, credit institutions had been sitting exclusively on a treasure trove of data from which they had made surprisingly little. We are talking about the transaction data of the millions of checking accounts of their customers. But thanks to the second EU Payment Services Directive (PSD2), new opportunities are emerging here. From now on, the account holders themselves decide whom they wish to grant access to the account data. This is an option that so-called "neo-banks" already grant themselves when opening an account. The credit institutions are therefore no longer the exclusive source of this information.
And they can be more than worthwhile for insurers. For example, if a fancy racing bike has been purchased for the kids or a new set of couches has been purchased, the company could (assuming access is allowed) remind you of a possible increase in homeowner's insurance or suggest a policy to cover the risk of the bicycle being stolen.
As long as clients receive transparent information as to why the insurer is making this offer, there would be nothing dishonorable about it, nor would it be considered a cause for concern.
Fintech firms have been quick to see an opportunity in (technically called) account information services and seize it. This is knowledge that insurers do not necessarily have to purchase at great expense through cooperative ventures with startups, however, because AI systems that take care of analyzing the information are already available. The only thing missing is the will to make a stronger impression on customers as a contact partner.
And this can work with well-conceived services, which may or may not have anything to do with insurance products. Why not remind them of monthly payments, and thus exchange fees, when account data shows that Netflix is being used? A tip for policyholders in the winter months is that it is perhaps better to suspend theft insurance for the newly purchased bicycle because it is currently not being used?
There are plenty of ways to play. So all that is needed is creativity and a technical solution to help with data analysis. A rather small investment to secure the customer interface.
The insurance industry can still catch up with the lead. To win, insurance companies must not only work on concepts, but also develop their IT infrastructure. We would be happy to explain to you in a personal conversation how you can master this.
