Insurance Execs Eye Multi-Channel Investments: Survey
Technology, customer needs spur new strategies.
More companies are looking to mobile technology to optimize their distribution efforts, not as stand-alone channels: they plan to invest an average of $84 million (US) into multi-distribution channels in the next three years, keeping brokers as a key part of their strategy, the Accenture survey found.
Despite a tech-centred shift in thinking–62% of respondents say they are considering investments in mobile capabilities in the near future, compared to the 19% currently doing so, an even greater majority stressed the importance of broker ties: 75% said that developing relationships with independent agents and brokers was a main priority, with 73% channeling their online efforts into specialized tools and sales support.
Creating a competitive edge
The responses–from P&C and life executives in 25 countries, including Canada–reveal dissatisfaction with current distribution models. Over half (63%) don’t see their current models as a competitive edge, but do see emerging technologies as a way to add that edge: 85% tie their new investments to emerging tech tools.
Other factors drive the distribution push: 84% point to changing consumer needs and attitudes and 81% cite the need for advice in insurance distribution.
“Consumers are not simply replacing one channel with another, but are diversifying and using more channels than ever for all of their needs,” Serge Callet, global managing director of Accenture’s insurance practice, said in releasing the survey findings May 24.
“The challenge facing insurers is to develop a distribution strategy that capitalizes on the strengths of each respective channel and that will allow them to match the right customers with the right products and services, at the right price, through the right channels,” he said.
Different customer, different channel
With insurers shifting their focus toward mobile technology and digital marketing, they also plan to tweak their marketing strategy. Just over a quarter of respondents–26%–plan to customize their products and distribution channels according to specific customer segments over the next three years. At present, only 14% use this approach.
“Consumer-service leaders such as Amazon and Apple raise the bar for everyone,” Michael Costonis, executive director of Accenture’s Insurance practice in North America, said of the findings. “Insurers are starting to realize that their products should be bought and not just sold. To do this they need to truly understand their customers, and to achieve a level of segmentation that is indispensable for moving from a product-centric to a solution-centric business model.”
Getting there will take some effort for most respondents: 63% say that aligning their IT infrastructure with a defined distribution strategy will be a key challenge to their plans.