Leveraging Data-Driven Marketing for the Insurance Industry

Leveraging
Data-Driven Marketing
for the Insurance Industry
Produced by Near | Allspark

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01
02
03
04
Introduction
Insurance Industry: The Current Challenges
The Solution
How Data-Driven Platforms can Boost Your Insurance Business
Summing it Up

Introduction | Current Challenges | Solution | Boost Your Insurance Business | Summing it Up
INTRODUCTION
4.5%
4.5%
With the global economy expected to be influenced by the better economic
prospects in the US, and with the large growth potential of the Asian markets, the
general insurance sector is expected to see moderate growth by 2018. According to
Munich RE, the international insurance sector is expected to grow at an average of
4.5% (3.0% in real terms, adjusted for inflation) in 2017 and 2018. Premiums in the
insurance sector are therefore likely to evolve in line with the global economy, which
should show real growth of 2.9% in 2017 and 3.1% in 2018. Projected premium growth
will thus be slightly higher than that of 2016, and significantly exceed the average
growth rate of almost 2% for the past ten years.
3.1%
2.9%
2017 2018
Insurance Sector
Premium
While the world has seen a boom in the use of technology to harness data across sectors, the insurance sector has been slower to adopt & implement digital
technologies, especially when compared to others in financial services. Leaders in the sector believe that a comprehensive data driven strategy is the way
forward, and have started investing in this direction.
The explosion of Machine Learning and Data Science in the last few years has proven without doubt that high-precision and actionable data gives businesses
the capability to curate customers and build new targeted audience bases, and thus recognize new opportunities that might not have been identified before.
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Introduction | Current Challenges | Solution | Boost Your Insurance Business | Summing it Up
Insurance Industry: The Current Challenges
According to experts, Insurance industry - one of the oldest industries that has always dealt with
massive amounts of data in every aspect of their business - unfortunately, has not caught up with
the concept of "identifying the right customers at the right time" as the rest of the world. As a
Figure 1: Which of the following (digital) technologies do you expect to have the
biggest impact on the insurance sector over the next two years and the next five
years? (Please select top two)
0% 10% 20% 30% 40% 50% 60% 70% 80%
result, they have not been able to fully capitalize on the data they already have and win new
customers. However, the industry is now beginning to respond to the changing demands of their
consumers, and is beginning to recognize the cutting edge data and technology can bring to the
table and do much more than they have been able to so far.
According to a survey carried out by Willis Towers Watson, leaders in the industry believe that
along with web & mobile as important channels for delivery, big data and real-time analytics will
be one of the key digital technologies to have the largest impact in the sector, especially in the
present to near future. (figure 1). Investing in digital channels will enable faster distribution &
reduce inefficiencies, whereas the use of data analytics would enable faster processing of claims,
and create new avenues of customer acquisition.
Web and mobile delivery
Big data/real-time analytics
Automation and data integration
Peer-to-peer risk sharing
18
16
Aggregators
8
13
Robo-advisers (advice provided by computer model/artificial intelligence)
30
9
Sensors (including GPS, telematics/UBI, wearables, smart sensors, internet
of things, connected devices)
22
4
Blockchain
12
31
40
41
39
40
77
5 years 2 years
Source: New Horizons – How diverse growth strategies can advance
digitalisation in the insurance industry - Willis Towers Watson
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Introduction | Current Challenges | Solution | Boost Your Insurance Business | Summing it Up
A big problem that the experts emphasize in Insurance business is that of siloed data. The Insurance industry has traditionally always dealt with huge amounts of
data, but it is scattered and fragmented through their various departments. This prevents them from building a 360-degree vision that provides a clear and
complete picture, preventing them from embracing a holistic strategy that balances tactical decision-making with strategic investment.
The traditional and complex problem of identifying, targeting, and converting customers across disparate channels remains. In fact, it has only grown even more
complex with the emergence of the online world and the explosion of digital and mobile media and channels. Consumers now expect relevant and personalized
experiences across offline channels, along with web, mobile, and social media experience.
Yet another big practical problem that the Insurance industry faces is the “low-touch” nature of their business. Insurance companies usually do not have physical
stores. Once insurance is sold online or by an agent, the Insurance organization loses contact with their customers until they make a claim. In this vast interval
between a customer buying an insurance and making an insurance claim, the organization has absolutely no view into lifestyles of their customers. Currently, they
have no way to identify their customers’ preferences, behavior patterns, and most importantly, the times when their lifestyle changes. For example, the crucial
turning point in any customer’s lifetime is when they get married, buy a house, buy a new vehicle, have a child, etc. These are the turning points when they are likely
to change their insurance portfolio, and fantastic opportunities for an Insurer to upsell and cross-sell their insurance products. But because of the lack of data on
this, Insurance industry tends to lose touch with their customers, and also lose great business opportunities.
Considering these problems, the Insurance industry needs to find a solution to harness the power of the data they have to develop a highly effective strategy with
emotionally intelligent and relevant messaging that helps them stay ahead of competition.
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Introduction | Current Challenges | Solution | Boost Your Insurance Business | Summing it Up
The Solution
In today's business environment, data is not a luxury, but a necessity.
The questions that any Insurer must ask today are:
Figure 2: What do you see as the most important benefits that can be derived from
new digital technologies? (Please select top three)
0% 10% 20% 30% 40% 50% 60%
What data do I have and
where is it located? How do
I bring this data together?
How do I personalize my message to my
target audiences to nurture existing consumer
relationships and yet generate new leads?
How do I maintain constant touch with every
individual existing or potential customer, and
effectively monitor major changes in their lifestyles?
Improved customer management and claims handling
Better alignment of interests between consumers and insurers
(e.g. through incentivisation)
40
56
Improved cross-sell and up-sell opportunities
32
By embracing and investing in the data-driven approach and data platforms that harness the power of
ambient data, the Insurance industry can effectively and efficiently answer these questions and solve the
problems it is currently facing without having to reinvent the wheel.
Leaders from the industry highlighted the benefits they perceived by utilizing a data driven approach.
According to this survey, real-time processing of a large quantum of data from disparate sources will allow
for better customer lifecycle management & retention, improved customer offerings - by aligning the needs
of the customer and the insurance firms and, enable creation of highly customised cross-sell & upsell
opportunities (figure 2)
Reduction in distribution costs/agency fees
28
Increased pricing flexibility and accuracy
27
Better segmentation of customers by true level of risk
26
Increased automation of the value chain
26
Reduction in administrative costs
21
Extension of cover to underinsured and non-insured
18
Reduced frequency of loss events (e.g. with sensors/interventions)
17
‘À la carte’ coverage based on exact need/usage
9
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Introduction | Current Challenges | Solution | Boost Your Insurance Business | Summing it Up
A Data-driven approach forces you to unify your siloed data and present it in a usable form that can be
effectively leveraged for various analyses. This is a concentrated, expensive, and time-consuming effort, but
well worth your time and resources. This is because you will finally have a single, consolidated view into
your scattered and fragmented data, which is what your competition might be lacking, giving you distinct
competitive edge. Also, with the availability of the integrated data and powerful analytics, you can also take
quicker decisions, which in turn, leads to more efficient processes. Near’s SaaS audience product Allspark
can help Insurers unify their data across devices, channels and places, and enrich it to create a unified
consumer view.
It is a well-known fact that new parents have a much higher chance of buying medical insurance. Therefore,
it is imperative for an Insurer to accurately identify and reach out to this demographic at the right time and
sell them the insurance solution they are looking for. Investing in the right Data platform will allow you to do
so, because these platforms not only unify your data, but also enrich and enhance it by augmenting it with
the third-party data they offer. To continue with the example of new parents, you can use these Data
platforms to capture this audience when they exhibit behavior of new parents (way before they actually
become parents), such as using a pregnancy app, searching for baby names, or visiting nurseries. By doing
so, you now have access to fresh customer base you can sell your products and services to.
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Introduction | Current Challenges | Solution | Boost Your Insurance Business | Summing it Up
By using this unified data, you can not only reveal your top markets, prospects, and
customers, but also profile and understand your customer base better. This will allow
you to offer relevant, timely, and better service to your consumers, helping you
establish stronger and lasting relationships with your customers.
In addition, Data platforms today enable you to constantly monitor and analyze in real
time the available consumer data and demographics, which can help you develop
timely and targeted insurance products. For example, studies show that people
invest in appropriate insurance whenever they achieve an important milestone, such
as getting married, buying a new house, or buying a new vehicle, relocating to new
city or a country, etc. So, Data platforms not only help you identify new customers and
convert them to existing customers, but also help you gain continuous and deep
insights about these customers throughout their lifetime.
Play
Here is a small video on how the BFSI sector is using data
intelligence for better business and marketing decisions.
Not only this, but by effectively analyzing your customer base constantly, Insurance
organizations can also reduce the claim settlement costs and times, and identify
fraudulent claims in time.
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Introduction | Current Challenges | Solution | Boost Your Insurance Business | Summing it Up
How Data-Driven Platforms can Boost Your Insurance Business
Curate accurate audience bases
that are based on their real-life
preferences and behavior.
Deliver highly targeted
campaigns across
touchpoints and channels.
Use advanced analytics to
revise and better your
offerings.
Trim your processes and reduce your
operational risks based on real-world and
real-time measurements and analyses.
Measure and analyze the success (or
failure) of their campaigns with the help
of marketing response attribution.
Provide feedback to its New Product Development
division based on the nature of the consumers in a
market, and their lifestyle changes over time.
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Introduction | Current Challenges | Solution | Boost Your Insurance Business | Summing it Up
Summing it Up
In these times of rapid change and tight marketing budgets, no Insurance organization
can afford to blindly invest in a marketing strategy without knowing what's working and
what's not. It has been proven without doubt that new-age Data Platforms (such as
Allspark) improve efficiency and effectiveness of marketing campaigns - from branding
and awareness to new product launch. And the Insurance indus try is no exception.
The disruption of the Insurance business has already begun, and the era of “intelligent
insurer” is already under way. It is now for you to decide whether you will be a leader
or jump on the bandwagon when it is already too late.
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Near is an Ambient Intelligence Platform providing real-time information on places, people and products.
The Near platform processes massive data from smart environments to understand consumer behaviour
at a global scale. Currently processing data from over a billion devices, the Near platform powers Allspark,
its flagship SaaS product for data-driven decisions, which enables customers to visualize, engage and
analyze audiences.
Founded in 2012, Near is headquartered in Singapore with offices in San Francisco, New York, London,
Bangalore, Tokyo and Sydney. Today, Near has its global footprint across 44 countries, and works with
marquee brands including P&G, Coca Cola, Ikea, Audi, McDonald’s, Toyota, Nike, and Samsung.
Near is backed by leading venture capitalists Sequoia Capital, JP Morgan Private Equity Group, Cisco
Investments, Telstra Ventures, and Global Brain Japan.
Visit www.near.co to find out more