At the 2019 SCOR Annual Conference, Daniel Theben and Henry Bovy led an interactive discussion on the expanding risk universe – and what it means for the (re)insurance industry. The challenge for insurers is to manage the downsides of existing and new emerging risk while seizing opportunities to provide new solutions and support for their clients. This requires (re)insurers to pro-actively identify, assess and capture emerging risks in their risk models, once relevant for their risk profile.
The comorbidity between HIV and cancer is proven - cancer can grow by invading the host’s immune defenses and benefiting from a loss of immunological control. Thanks to treatments, people living with HIV are living longer, but HIV seems to accelerate the ageing process, with a high incidence of cancer in HIV-carrying patients.
In this blog, Vincent Foucart and Eric Le Mercier discuss the role of reinsurance in helping to build resilience in economies and communities around the world. They look at the “insurance protection gap” – the difference between economic losses in disaster-stricken countries, and what is effectively covered by insurance. And they examine ways of helping to bridge this gap.
These Five Rules Will Change the Way Consumers Engage with Insurance
The insurance industry can re-write the rules of customer engagement: tackle the distrust in sharing personal health data, address the current underwriting pain point and align with consumers’ contemporary inspirations for healthier living. As the insurance industry evolves, SCOR Global Life identified 5 new rules of consumer engagement to be front and center to address these challenges.
It’s no surprise that today’s consumer has no patience or loyalty for so-called ‘transactional brands.’ In other words, a company’s relevance hinges not only on excellent service or products but also—increasingly—the ability to demonstrate a value that speaks to a bigger community purpose.
What does this expectation mean for health insurers? If we are honest, the existing process of underwriting and claims is not particularly memorable or delightful. In order to process a quote, customers face lengthy questionnaires or invasive and time-consuming medical exams. Premiums are priced on the assumption that all individuals within a group will continue to live their lives in the same fashion. After signing up for insurance, there is an absence of positive or meaningful interactions between insurers and consumers unless there is a new sales opportunity or need to file a claim.
But does customer delight, or trust, actually impact the bottom line? A recent independent consumer study, commissioned by SCOR Global Life/ReMark, which surveyed 8,000 insurance customers in 14 key life markets, suggests “yes”.
The insights confirm a high consumer trust deficit and a lack of shared values in the underwriting process in Asia Pacific. Overall, life insurance consumers are suspicious of sharing their personal health data. Consumers in Japan (56%), Malaysia (43%), and China (39%) reported the most reluctance to share. This is problematic as underwriting requires 100% participation.
At least some consumers see no upside to sharing personal data. In other words, revealing more information about yourself can only have a negative effect—your premium will go up or you may face exclusions —with no commensurate reward for a healthy lifestyle.
The good news is that while there may be high distrust for sharing health data directly, consumers indicated that they are willing to receive a wearable device from their insurer which can monitor some of these health metrics in real time. In fact, half of wearable non-owners in Asia Pacific said they would welcome it.
The strong appetite for wearables in these markets appears to be linked to the trending desire to pursue positive lifestyle changes. According to the survey, nearly half of Millennials (45%) and Gen Xers (42%) in Asia Pacific are currently members of wellness programmes. In Asia Pacific, 71% of consumers who own wearables say that they believe their device will help improve their lifestyle and 55% express their device can alter their behaviour.
Customer-centric innovations could include incorporating a wearables-based approach to the existing underwriting process (dynamic underwriting), introducing lifespan protection offerings, and exploring appropriate programmes and rates for individuals based on Biological Age Model (BAM) rather than merely chronological age.
Combined with a wellness platform, this innovation facilitates continuous positive engagement between the insurers and their customers. The objective is to motivate consumers through customized, individual information to live a healthier lifestyle based on the data they provide. In short, this is a game changer for our industry, and with leading insurance companies starting to adopt biological age modeling, the trend is set to grow.
As our industry evolves, these 5 new rules of consumer engagement should be front and center:
Health is the new wealth: Strong aspirations for healthier living across all markets opens the door for insurers to engage in a more positive style of service and lifespan protection services.
Be a partner in better health: The industry must realize that their role in integrating life and health services is not only feasible but inevitable. Investigating new approaches, such as dynamic underwriting, wellness programmes, and leveraging future technology in ways that truly reward the achievement of mutual goals is very important.
Trust builds shared value: Information has become the cornerstone in all company initiatives. Insurers need to overcome the trust deficit and reluctance of consumers to share information by providing better education and a new value proposition.
Look for sustainable solutions: Incentives, without the right proposition, can only be short-term motivators.
Empower don’t overwhelm: Consumers want the freedom to choose along with a degree of flexibility. However, they may not have a firm enough understanding of the industry and its processes to voice their demand. It is important that the industry thinks about ways to empower this voice through its offerings.
Shared value starts with better consumer engagement during all points of the process. Insurers have the opportunity to deepen their relationship with customers from one of mere transaction to one of active leadership and guidance in daily health decision making.