Over the last decade, carriers have regularly adjusted strategies to achieve greater profitability. This resulted in an era heavily focused on data and analytics, automation, and digitization. Perhaps overlooked in these efforts is a better connection to people, with an emphasis on empathy for the individual and their situation.
This is the perfect time for our industry to focus on experiences! A focus on people, their situation, and how events impact their lives, i.e., the human experience.
Building trust through humanized insurance practices
Prioritizing a humanized experience will drive the next era of insurance. In this new era, humanized insurance would go beyond better customer experiences. In fact, insurers can look forward to empathy driven insurance strategies for meaningful interactions that foster trust, earn loyalty, and create lasting value between the insured and insurer.
- Trust benefits the individuals, reducing their anxiety so they can live their best life
- Loyalty, fostered by trust, benefits insurers, helping them deliver greater customer lifetime value
- Lasting Value for society through coverage, free from bias, for all people
Of humanized insurance and empathy-driven insurance strategies
Humanized insurance is the aspirational idea that insurance can be better and deliver more for people, businesses, and insurers. As mentioned in a previous blog post by Jess Keeney, humanized insurance is an idea rooted in empathy. Empathy can be shown throughout the entire insurance customer journey via:
- Offerings and premiums defined without bias or malice stemming from location, ethnicity, or personal history.
- Protection of a larger percentage of society through concepts like parametric insurance, fair plans, stronger reinsurance, and yet-to-be-defined offerings.
- Communication of information in a clear, understandable manner, so that specific coverage is understood by policyholders.
- Return a greater percentage of premiums back to the insured by shifting risk from indemnification to preventative measures through careful managing and mitigating.
- Speed-to-service for claims executed with emphasis on meaningful contact and support
- Shift the focus of insurers’ stakeholders to align with a sustainable future.
- Emphasis on insurer employees’ health and well-being as a connected part of successful customer experiences.
These example characteristics are just some of the ways that insurers can transition their community from a required necessity into a “trusted partner”, empowering people and businesses to thrive.
And, since trust is the key component of humanized experiences, consumers, businesses, and agents need to trust insurers to fulfill the promise of a more humanized experiences.
This means that policyholders need the following from their insurer:
- Confidence in the protection provided
- Belief that a price is equitable
- Reinforcement from peers on positive experiences
- Experiences and interactions that are easy to access and understand
- Outstanding support when the need arises
Humanized insurance is an investment which would pay off in the long run – carriers that foster trust can build greater relationships which translates to higher lifetime customer value (LTV) through improved retention and referral rates.
Take the next steps for a humanized insurance experience
There is still much to be done for the insurance industry to implement meaningful and humanized insurance practices. While the 2023 Global Consumer Insurance Insights indicated a positive outlook towards insurance providers, the study also noted an area of improvement that insurers may need to prioritize should they wish to take their first step towards the next era of insurance:
“… it is worth noting the common themes in the negative feedback from some consumers around clarity and confidence in 2023: there is still work to be done when it comes to transparently communicating policy terms and conditions to consumers.”
At Duck Creek, we understand the needs of the consumer and the connection to humanizing insurance. We passionately believe in the noble mission of insurance – to protect people and businesses – and we are ready to empower our P&C and general insurance community with the insights, technology, and inspiration to build a better human experience for our industry. Our strategy to deliver humanized insurance technology, which we broadly define as technology that enables carriers to create, deliver, and nurture the next era, will drive the humanized era of insurance.
I look forward to working with everyone to drive this new era.
