Insurance x CX: Approaches Non-Life Insurers Should Undertake Now to “Deepen their Customer Insights”

Under the traditional, brokerage-dependent business model, knowing customer was less prioritized for non-life insurers. However, in recent years, the life cycles and life events of customers, and their ways of working have changed, diversifying their values. This has led us into an era in which insurers need to understand their customers better than ever before and provide products and services that fit with the needs of each individual customer. Insurers also need to take into account differences of in values between generations. For example, a cohort has emerged, principally among young people in Generation Z (those born between 1996 and 2010), which has a strong avoidance towards wasting time, so called “time-performance" has emerged as a common term.

Even compared to the types of services that general consumers experience from other industries, efforts to offer individualized services to each non-life insurance customer seem incomplete. In particular, common customer pain points that arise in the non-life insurance industry include “lack of understanding,” “not at optimum timing,” and “long lead time” (see Figure 3). All companies need to ascertain not just the obvious needs of their customers, but also their potential needs, so that they can provide information regarding products and services that customers currently truly need.

(examples)

• Customers are unable to receive the information they need when they need it because, in need-generation, communication tends to be pushed “from non-life insurance companies/brokerages.”
• Explanations regarding insurance products and procedures are difficult to understand.
• Customers easily get stressed by burden of repeating necessary information at each customer touchpoint.

We believe that the non-life insurance should seek to provide products and services that incorporate needs that corresponds to individual customer life-stages or their preferences and interests.  Operational wise, seek to have end-to-end, one-to-one communications even in their customer service (see Figure 4).

It goes without saying that in order to achieve one-to-one communications suited to each individual customer, companies will need sufficient data for customer insights. But when it comes to the question of what data is needed to deepen customer insight, we often see cases where companies push data-driven management while not having adequate policies to accomplish customer centric jouned with shared understanding across departments.
In terms of approaches companies can take to making effective use of data that contributes to customer experience (CX) transformation, we believe that the key points are setting targets that contribute to cross-organizational operations, establishing neutral CX driving organizations that do not create discord between departments to drive those targets, ongoing personnel development that is not limited to departments in charge of customer contact points, and carrying out internal promotional activities around these efforts, while also formulating a medium to long-term strategy (see Figure 5). Most crucial key point we believe is, to consider policies redefined to fulfil the customer journey that has common understanding across departments, and organizing data that contributes to improve the quality of customer service at each customer contact point.
Recently, all companies have put forward “data-driven management” as a strategy. However, a problem that companies can easily fall into such trap when their back-office departments, which tend to be physically away from the customer, are driving such discussion.  The discussion tends to  turn into introduction of systems and technology as a goal in and of itself. We feel that there are many cases where, well thought CX transformation shifts away from customer first perspective and becomes project that only to , integrat data management or enhance data extraction and analysis, through means such as building data warehousing (DWH) or customer data platform　(CDP) /customer relationship management (CRM), or making use of cutting-edge technologies and tools such as generative AI The data and requirements truly need to contribute to improve customer service quality, however, in many cases those data and requirements remain ambiguously defined. Companies should ask if they are falling into the trap where building DWH or CDP/CRM and introducing solutions has become a goal for its own sake.  Also, check data requirements and quality to see if they have ended up using data purely for show due to data quality (e.g., details or clarity of items) not meeting the needs of customer or user departments (i.e.,customer facing staff) , or if the solutions are turning into “mere boxes” where fragmented data is collected.  It is also possible that, as a result, not only will these efforts not contribute to improving the customer experience, the astronomical increase in the volume of data needed to keep up with the development of technologies such as big data and AI may pose a greater risk of degradation in terms of maintainability.
Given all, it is necessary for companies to rethink their policies from the ground up, having redefined the customer journey such that there is a shared understanding across departments. From a data integration management perspective, it is also important for companies to acknowledge that they should foster data for deepening customer insight going forward, rather than trying to go from 0 to 100 with their systems all at once,  As customer modes of behavior and customer needs are expected to diversify further and become still more complex as society changes, it is essential for companies to continue a regular process of review with the objective of improving customer service quality.

It is likely that, to date, the majority of non-life insurance companies have attempted to understand their customers in terms of the customer journey. However, there is a concern that customers cannot be refined down to a target using a journey based on a general persona. In an industry like non-life insurance, companies are dealing with a broad range of customers and wide range of products. There are also many cases where customer journey development process end up nowhere, either because each department draws up its own customer journey and winds up with a different understanding of the customer, or the journey at some point winds up becoming an insurance company perspective, fails to come together in a way that can secure a budget. Here we propose points to bear in mind when designing customer journeys in the non-life insurance industry that have proved useful  based on our project experiences.

• Think in terms of “life events”
  Keep in mind life events for each age period, such as finding work, getting married, giving birth, buying a home, undergoing preventative care or care to prevent aggravation of a condition, and receiving nursing care.
• Prepare several “representative scenarios” that capture target customers for each area
  Because the customer demographics of the insurance industry are diverse in terms of age and hold a wide variety of values, it is a typical mistake to refine the persona down too far. We believe it is practical to set target customers based on the characteristics of different areas, prepare (5-7) representative patterns, considering the products, services and digital contact points the target customer appreciates the most in their daily life, and devise customer journeys for each.
• Clarify the differences in behavior and sentiment per channel
  Capture the fact that customer anxieties, expectations and behaviors will, even for the same product, differ by channel, such as online (online comparison, social media, YouTube)/in person (in store, visit, personal recommendation).
• Devise an “ongoing journey” for before and after the customer signs the insurance policy
  Insurance is not a “bought then over.” Rather, the experience starts from the policy issuance (i.e., various procedures such as making claims, terminating contracts or considering lowering premiums) is also important. Thus, “experiences during times of trouble,” such as making claims or revising policies, have a tremendous effect on the customer satisfaction points and on trust on the brand.
• Consider coordination with sales, brokerages and contact centers
  Even with advancements in digitalization, it is likely that the peace of mind and need for support via a human being will, to some degree, remain. Thus, the “combination of digital experiences and by person experiences” are important.