Three questions with Karen Scott, Head of Research at Research in Finance, on the importance of independent research to support insurer strategies and the building of an invaluable benchmark research series through the annual Global Consumer Insurance Insights surveys
In May 2023, Duck Creek Technologies proudly published its second annual benchmark survey, the 2023 Global Consumer Insurance Insights. The 2022 and 2023 waves of research were conducted independently by Research in Finance for Duck Creek Technologies and involved surveying over 2,000 policyholders across 13 countries, all of whom held at least one insurance policy.
Aimed at refining the strategies that bring insurers closer to consumers worldwide, the 2023 survey reveals strong demand from global consumers for humanized insurance purchasing, switching and communication experiences through digital channels.
We caught up with Karen Scott, the Head of Research at Research in Finance, to learn more about the strategic thinking behind the survey and what results surprised her most.
QUESTION: The 2023 survey is more extensive than the inaugural 2022 edition, with more questions and responses from policyholders across more countries. Which findings surprised you most in the 2023 survey?
I was surprised by how different some of the geographical splits were, particularly across Europe. For example, when looking at the sources of advice/research that policyholders take into account before buying insurance, UK and Norwegian respondents are more likely to consider price comparison websites, whereas those in Portugal and Spain are more likely to value advice from friends, colleagues or insurance brokers. French respondents value the advice given to them at the point of sale.
There were a couple of standout findings for me:
Overall, our findings show that respondents from India and Singapore are less likely to own home or motor insurance but are more likely to have life insurance and critical illness coverage. We proposed this might be because respondents in this cohort were younger and may not own a home or car yet.
Also, the standard of health services in those countries might amplify the need to purchase independent cover for any health risks. While not surprising, it was promising that our findings supported a broader understanding of these markets.
In the same vein, perhaps unsurprisingly, our findings highlight that the pandemic might have indirectly led to the increased purchase of some specific coverage, such as income protection, critical illness coverage and private medical insurance, due to perceived concerns around personal vulnerability.
The purchase of insurance for cellphones and other gadgets differed from almost all other insurance covers we investigated. Irrespective of age, a high proportion of policyholders (nearly 40%) buy this at the point of sale (as an add-on). However, purchasing in this way instills the customer with the least confidence that they have purchased the correct level of cover (16% of those buying at the point of sale are not confident).
Despite concern that some policyholders consider unbundling elements of their insurance due to the total price (i.e., a small discount for a bundled offer needs to be more compelling for them to purchase), our findings suggest that less than 10% of policyholders see bundled insurance unattractive It will be worth tracking in future years to see if unbundling is an increasing trend.
QUESTION: What is the value of an annual independent benchmark survey into consumer insights for insurers around the world?
We now have two years of findings captured using an identical methodology. This starts to build a trend from which we can continue to track how policyholders worldwide feel about their insurance purchases, engagement preferences with providers and attitudes towards new initiatives and innovations, such as embedded insurance.
It will be important to continue to benchmark the findings to ascertain whether any change in results indicates a genuine shift in behaviors and opinions or just a blip for one particular year. An annual review is the ideal repeat cycle for these types of benchmark studies.
In due course, we will be able to combine the findings across the years and build up a greater understanding of policyholders by country or region. This will enable us to delve into some questions where the sample for one particular year might have been too small to draw out any meaningful insight.
QUESTION: Now insurers have two years of invaluable data to compare. And what did you feel were the most significant changes between this year and last year?
One of the most significant changes this year was the increase in the geographical spread of respondents. Last year we heard from policyholders in 7 countries, but this year it increased to 13 with the addition of Denmark, Norway, France, Sweden, Singapore and India. That resulted in smaller samples in the US, UK and Canada.
We also found that many of the innovations and new initiatives were favored by those in a younger age group, which is unsurprising. Therefore, with a younger spread of respondents in India and Singapore, we saw higher demand for insurance innovations overall in those regions.
Interestingly, compared to last year, we noticed a slight shift in preference for the types of interactions that consumers prefer. Specifically, compared to the previous wave, there is a greater degree of preference for human interaction when switching as well as purchasing and making changes. While online solutions are still highly valued, this shift indicates a need for a human point of contact to remain part of the process during an era of digital dominance.
We were delighted to work with Duck Creek once again. It has been an incredibly interesting wave, and we have accumulated plenty of useful data, which we hope gives valuable insight into the insurance industry.
