An introduction
What are the features and characteristics of home insurance and auto insurance that are most attractive to customers? This question has figured prominently in the minds of insurance executives in recent years. The answers gain urgency as the ongoing social and economic consequences of COVID-19 lead many customers to consider the value and flexibility of insurance products in terms of changing circumstances and needs.
Five main findings emerge from the survey:
Customers prefer simplicity
They want products that are easy to understand, buy and use. They also want to be confident that they are paying a fair price, and that claims will be paid fairly; With this insight, insurance companies can use a human-centered approach to re-engineer products and exceed customer expectations
Interest in insurance embedded in other services and in new product designs is strong in some customer segments. But varies widely by country
Internet-connected offerings. Such as car telecommunications and home insurance linked to home sensors, are causing concerns among many customers. They don’t feel comfortable sharing data from car and home sensors with insurance companies
The COVID-19 pandemic is increasing the demand for adjustable cap and pushing people towards transacting through online channels; This behavior is unlikely to return to pre-crisis standards for many people
The survey suggests three opportunities to support growth
simplifying how customers perceive and interact with products; Benefit from strong demand for modular home insurance; and carefully target specific segments with new services.
Make it simple and understandable
Our main finding is that customers prefer simplicity. Figure 1 shows the main reasons for customers to like or dislike a set of products and services (see Appendix for full descriptions). The most popular products are those that are easy to compare, familiar, simple and not intrusive. Therefore, customers love the simplicity that “basic” products offer, but they also express some frustration with their lack of flexibility.
What is behind these results?
Simplicity – Many respondents like simple products because they are quick and easy to understand, buy, and use. At the same time, simple products generate confidence as to what is covered, an issue that has cropped up due to COVID-19. Many of those surveyed questioned how their policies would respond to changes resulting from the shutdown.1 One customer summed up these sentiments by saying that he preferred the core product because it was a “wance group.” Others said they liked the base wrap the most because it was “easy to understand” and “easy to handle.”
Data privacy – Customers are increasingly concerned about data privacy and do not want to share personal data with insurance companies without a compelling reason. Many seek to avoid sharing data that could drive up their premiums; Others don’t like the feeling of an invasion of privacy. One of the participant said. I think it’s easier to keep these basic services more or less equal to all groups in society by not asking for information.
Comparability – Many young clients, particularly in China and the UK, compare insurance companies to find and switch to the cheapest insurance policy each year. Across the eight states surveyed. A quarter of auto insurance customers and five home insurance customers reported having converted in the past 12 months. In China and the UK, this rises to 48 percent and 44 percent among 18-34 year olds for home insurance and 57 percent and 53 percent among the same age group in car insurance.
Customers rated the “self-censored, adjustable” cover as their second favorite. It accounted for 19 percent of products rated as customer first choice.
Adjustability – Feedback on the survey shows that many respondents want the ability to modify their cover based on what they need and can tolerate. Comments also revealed that adjustability has increased in importance in clients’ minds due to the disruption to life and work caused by COVID-19. However, insurance companies need to walk a fine line between keeping products simple for customers and allowing for modification potential.