Insurance Advisor Or Digitalization

Most customers aren’t interested in digital domination but in a balance between what a human advisor brings to the table and the ease that digitization offers. Policyholders have different preferences depending on where in the insurance process they currently are. The claims segment, for instance, has been found to be an area in which the involvement of an advisor is preferred over self-serve channels.

Digitalization - only 27% turn to social media for information; 50% to a human advisor; 56%, insurer websites; and 73%, financial aggregators. Digital channels built to facilitate pre-purchase stages of the customer journey do not adequately answer questions customers may have about the products, premiums, coverage, and unique queries. There is a varying levels of perceived complexity when it comes to different insurance plans. Insurance plans considered the least complex is car insurance, while medical insurance appears most complex. 

Replacing Agent - The future of many industries, including insurance, suggests that digital innovation and its increasing accessibility will negate most of the need for actual human services eventually. However across insurance products of varying complexity, the levels of satisfaction with fully digital self-serve options only matched those of an advisor-assisted experience at best. As the levels of perceived complexity increased, so did the perceived need for an advisor to assist and guide the process.

Car Insurance - Approximately 80% of customers rely on financial aggregators when looking for information on car insurance; 65% use insurance provider sites; 46% for both financial advisor and friends & family; 27%, social media sites; and 25%, forums.

Critical illness - 86% turn to financial aggregators for information; 44% to insurer sites, financial advisor, and friends & family; 35%, social media; and 21%, forums. Home contents – 88% use financial aggregators; 51%, insurance provider sites; 37%, friends & family; social media, 36%; financial advisor; 34%; and forums, 15%.

Medical Insurance - only 59% rely on financial aggregators while 54% turn to financial advisors. Insurer sites are used by 58% of respondents; friends & family, 54%; forums, 17%; and social media sites, 15%.

Purchase channels - 57% buy car insurance online while 43% go through an advisor. For critical illness cover, 63% take the online route; home contents, 61%; and hospitalization; only 26% buy online. Out of 4 types of insurance offered - critical illness is more likely to be bought via self-serve platforms, thanks to an abundance of information and education accessible through digital touchpoints such as personal finance content publishers and insurer websites. Buyers of critical illness insurance have sufficient reassurance from their chosen sources, they consider the purchase experience “relatively easy”. Claims-wise, meanwhile, there is a higher preference (71%) among critical illness policyholders to engage with an actual advisor.

Disruption - Artificial intelligence, real-time digital customer support, and "Insurtech" integrations, to name a few, will change much of the insurance industry. However a balance between ‘bots and bodies’ should be struck. Yet, we find the nuance of human interaction to still be of tremendous value in this equation – the customer.