How insurance companies can boost customer retention with mobile innovation
Insurance companies don’t have to miss out on all the fun with mobile technology, but the way these organizations leverage innovative solutions is much different from how a retail brand might go mobile. Outside of standard practices such as building a mobile app that contains pertinent policy information — as well as features to help gather photos and information when submitting a claim — insurers often look to mobile as a way to improve customer retention by streamlining the workload of processing claims.
Meanwhile, mobile technology is allowing these companies to harness the power of data, which is huge for this industry. Data has always been the foundation of insurance since companies must analyze data to assess risk and then quantify that risk through the use of an algorithm. The importance of data hasn’t changed, but its uses have expanded considerably due to mobile technology.
Improved speed of claim resolution
Processing claims is a tedious process for both insurance agents and their clients. It involves numerous steps of gathering information and always takes a painful amount of time. Gradually, mobile technology is helping to ease this pain point. This began simply with the rise of smartphones, which let consumers take photos and video onsite at a car crash and send that information straight to the insurance company. Car sensors and smart home thermometers can also notify insurance companies of accidents or damage that will require the assistance of an insurance representative.
Meanwhile, insurance companies are able to identify potential fraud among these claims. Fraud is a major issue for insurers, as the Coalition Against Insurance Fraud “conservatively” estimates fraud steals $80 billion a year across all lines of insurance. Content management systems built on mobile technology can analyze incident data as it comes in, looking for patterns and inconsistencies that might raise a red flag. These flags are generated through automation for further review, saving time agents would have spent searching for evidence of fraud in the first place.
Innovative models for risk assessment
Telematics is a broad term that can apply to several types of ways to use technology to gather and process data. For insurers, this technology can drive data from many different points within connected vehicles. It can track data related to a car’s speed, brakes, handling, traffic signals and so on. In an accident, this information can be collected for analysis by insurance agencies, helping agents identify the causes of accidents faster. According to the British Insurance Brokers’ Association, the number of live telematics-based insurance policies has increased by 40 percent in one year in the UK.
Similar data can be drawn from smart devices within a home. Some companies are experimenting with ways to use this technology to drive better pricing programs and customer strategies. State Farm, for example, has tested a pay-as-you-go approach to insurance policies that uses consistent updates from your connected vehicle’s data feedback to assess your risk and price your policy accordingly. According to Property Casualty 360, as your behavior grows more reckless and risk-prone, the cost of your insurance may go up — but better driving habits could lead to a lower price over time. Customers who want to be billed according to their actual driving behavior, instead of their demographic information and driving record, may prefer such a payment option.
At any rate, better access to data is helping insurance companies create new services and features that enable better user experiences and customer retention.
Unleash the insurance drones
Drones aren’t a far-fetched application for insurance companies. According to Inc., Farmers Insurance is working on plans to use drones when assessing regions for their risk of wildfires. By using drones to assess brush management, insurance companies can price their home insurance policies with greater accuracy based on their risks of wildfire exposure.
Drones could also be used to provide coverage of accident sites, offering a faster alternative to deployment than what insurance agents might offer. The faster companies are able to deploy a presence to an accident location, the faster the claim process can be pushed along, improving customer service as a result. Because drones can be deployed without posing a risk to an individual person, they can be particularly useful at scenes where humans would be at risk, such as close to the perimeter of a fire or on the scene of a multi-car highway accident.
By embracing mobile technology and leaning into emerging digital trends, insurance brands are encouraging positive customer experiences and suppressing consumer negativity associated with drawn-out claims processes.