Christine Haeberlin, Business Development Executive, Insurance, IBM Canada, is offering new analysis on what brokers need to be doing on the Internet.
There is a big challenge in the insurance industry: customer satisfaction is low and seems to be getting lower.
To drastically improve the customer experience, insurance companies can adopt leading-edge technologies to support customers in areas they value. While the industry is highly regulated, which slows the adoption of innovations as a result of the
Internet of Things (IoT), Canadian insurance providers seem to be realizing the importance of advanced technology solutions to reinvent their business models. In fact, The Financial Services Commission of Ontario (FSCO) has already approved
11 insurers to offer
usage-based insurance (UBI) products.
Today, the insurance industry is at the forefront of transforming the business using the Internet of Things (IoT) – where technologies have become instrumented, interconnected and intelligent. More specifically, insurers are beginning to integrate advanced technologies like telematics to align to consumer preferences.
Telematics captures real-time data from multiple sensors that allows insurers and brokers to build tailored services based on details previously unavailable, such as individual driving patterns. Using this data, insurance companies can deliver customized rates and discounted offerings that produce – and increase – positive customer interactions.
Despite this progress and opportunity, recent studies show that
42 per cent of customers think their insurer can be counted on to provide good service. With an estimated 24 billion connected devices by 2020, this view will need to change. Experts have developed a list of effective ways auto insurance companies can leverage IoT technologies like telematics to increase consumer loyalty and gain a competitive advantage, including:
- Pay-as-you-drive offerings that enable insurance companies to integrate big data and analytics within a robust cloud environment to provide personalized premiums. Insurers and brokers can augment their pricing accuracy and offer lower or discounted coverage for their clients based on real-time driving data.
- Geo-fencing capabilities that enhance location status with other data, like traffic conditions and road maintenance information. This feature not only encourages safe driving, but also allows consumers to gain add-on coverage opportunities depending on their desired driving locations.
- Value-added services that use telematics to assist insurance providers in analyzing data from brakes, seat belts, air bags and more to predict an automobile accident. With this information, insurance companies can initiate value-added services, such as emergency response to the scene of an accident.
As evidenced by a number of projects, telematics is more than an abstract idea.
Take
Baseline Telematics. The Canadian-based telematics solutions provider designs usage-based insurance solutions for insurers around the world. Using a “Pay-As-You-Drive” telematics insurance platform, the company offers the insurers and brokers the ability to market highly differentiated products for their customers. Its telematics platform pulls personalized data to generate a premium on an individualized basis. Rather than creating products to comply with regulations or to offset historical claims, Baseline helps insurers and brokers modify products and services to meet specific needs.
There’s no question that the IoT is disruptive. However, it creates opportunities to leverage insurance telematics to help solve big problems in the insurance industry. Such is its power: to supply organizations with an arsenal of new opportunities that can expand business offerings, improve existing processes, increase efficiency and reduce costs – all while creating opportunities to improve insurance customer satisfaction.
