The Avenga Team
A current study by the German digital association Bitkom shows that one in two has already taken out a digital insurance. Customers are more than willing to expand digital direct sales of insurance products – this is especially true for the younger target group. We show you how to utilize the enormous potential in digital insurance marketing and sales.
The Bitkom study suggests that the digitalization of insurance sales has been well received by customers: more than one in two Germans (55%) has already purchased an insurance product online at least once. In the target group of under 30-year-olds, the figure is even significantly higher (65%).
However, the study of 1,003 people aged 16 and over, which is representative of Germany, also points out how important personal contact still is: a full 92 percent of all insurance policies are not taken out online, but still through an intermediary. According to Bitkom, however, this does not diminish the importance of digital direct sales:
“Insurance is a matter of trust. Personal contact plays a major role, especially for the older generation. Both sales via the broker and directly via the website will be of great importance in the future,” says Fabian Nadler, insurance expert at Bitkom.
After all, 43 percent of those surveyed stated that they had first informed themselves about insurance online and then taken out online insurance. This trend is likely to gain momentum, not least due to the natural generational change.
“In the future, insurance policies will increasingly be taken out online. The simpler and more comprehensible the insurance product is, the faster digital direct sales will increase,” says Nadler.
But also concluding an insurance personally through a broker is no longer as paper-based and “offline” as it used to be. Many insurers are driving the digital transformation on both levels, both directly at the interface with end customers (web, apps) and in the tools used by their brokers. Instead of visiting the customer with a file folder, sales professionals also want to keep up with the times and prefer to use digital solutions, for example, a tablet, when consulting. The Web application for customers and agents can even be one and the same: The global insurance company, HDI, for example, already implemented commercial insurance sales for both target groups in one application (Firmen Digital) in 2017.
For Nadler, too, digitizing personal advice plays an important role: “In the future, individual brokers will be able to use digital technologies both to care for more customers and to provide them with more specific advice thanks to the available data.”
You can find more data and information on the methodology of the study on the Bitkom website (German language).
Insurance customers usually wish to conclude their insurance products smoothly and efficiently online, with as little effort as possible. They want to quickly understand which risks an insurance product covers and which it does not. However, since the abstract nature of many products makes this difficult, they must be redesigned for online sales in order to create comprehensible, needs-based insurance offers which meet the customer’s needs.
The often intimidating complexity of insurance products with their multiple details should be adapted to the current usage context of the customer. For the customer, simple and transparent means:
Comprehensible product descriptions and information serve a significant customer interest and quickly build trust. If the target group for a product is broadly diversified in the population, then these points should be taken into account:
The front end should be tailor-made to fit specific customer groups or a clearly defined usage context. Though there is no permanent standard which will always lead to the desired results, of overriding relevance are, however:
When designing new insurance products and digital distribution channels, these three basic rules should be taken into account. Along with the appropriate technology between customer interface and internal systems, iterations can then be planned to find the individual best practice for your own company.
Learn more about the opportunities and challenges that the digital transformation offers established insurers. We have compiled the most important topics in a comprehensive overview on digital insurance for you, from customer proximity to new technology.