Incentivising for insurance change

Combining the intelligent management of data with behavioural economics can assist insurers in providing customers with more sustainable solutions, says Kelly Preston, data analytics manager at SilverBridge.

Merely having access to data is no longer good enough to be competitive in the insurance market. The data must be combined with meaningful analysis to enable better insights into what the customer wants.

However, people are creatures of habit and need an incentive to change. Despite how consumers have become less brand-loyal due to an increasing variety of product choices in the market, there are many who feel comfortable in maintaining the status quo. Even if an insurer provides such an individual with a completely customised solution, the likelihood that the customer will favour it over an existing policy is minimal.

Fortunately, behavioural economics can be combined with data analysis to unlock the potential that exists in providing customers with bespoke offerings. Already, there are insurers who incentivise policy-holders to perform health-related activities. Enhanced benefits, reduced premiums, and other value-adds are offered to ensure that people become more responsive to the reality of change being the new status quo.

Tailored services

Combining all these elements empowers the insurer to take its business to the next level with tailored solutions catering for a range of customers. As mentioned in a previous article, the generic segmented way of developing insurance solutions is becoming less pervasive. Today, people expect better service, tailored offerings, and rewards for not only their behaviour but also their willingness to remain at an insurer.

Gaining a deeper understanding of data is vital to accomplish this. An insurer needs to make sense of the vast amount of data at their disposal. Irrespective of whether it is structured or unstructured, data must be analysed more effectively to draw better conclusions. In this regard, behavioural economics provides a much-needed impetus to affect this change.

Intelligent data management is the next evolution of what an insurer needs to do as the means to differentiate its offering in a cluttered market. Combining the skills of data analysts, scientists, and others inside the organisation will help drive this. However, more than this is needed.

Understanding behaviour

Returning to business principles and utilising modern data analysis creates a more conducive environment for understanding behaviour. Too often, organisations succumb to the temptation of adopting the ‘latest and greatest’ technology innovations with little thought given to how it integrates into existing processes and practices.

As such, behavioural economics becomes an important tool to accomplish this. It gives insurers an accurate way to enhance its data and deliver a better customer experience. All told, this provides the required platform for true insurance differentiation.

About SilverBridge

SilverBridge has over 20 years’ experience as a leading provider of insurance software solutions in the African financial services industry. Our footprint extends to 13 African countries. SilverBridge has introduced an enhanced service offering allowing financial services companies the opportunity to respond quickly to changing markets. With more than 30 customers throughout Africa, SilverBridge has the knowledge, experience, and technology to help its clients do better business.[/fusion_text]