The insurance of tomorrow



  • Executive insight
  • By:

    Insurance is evolving quickly, and, if we are to stay ahead of the game, I think we can learn lessons from great companies outside of our sector who are engaging effectively with their customers and giving them the experience they want delivered in the way they want it. As an example, I’ve often wondered what it would look like if Apple did insurance.

    Why Apple? Because it has built a reputation for delivering to its customers aspirational products that are simple to use, do exactly what they want them to do and fit their lifestyle with no fluff or needless embellishment.  And doesn’t this sound like the conversation at every product development meeting you’ve ever attended?  It should, because these are the exact things that we would all love our insurance products to do but which we shy away from because they are not the traditional characteristics of our industry.  But we are Hiscox, and we should embrace the challenge because insurance that does those things would deliver an irresistible proposition to our customers and prospective customers, meeting all of their needs: certainty, flexibility and simplicity.

    “Simplicity”.  A word few people would ever associate with the insurance industry, but one we should all have as part of our vocabulary.  I would love our high value home insurance policy to be just one page of A4, clearly understood and free from the jargon and small print that creates unwanted, and usually unnecessary, complexity.  But this means challenging ourselves to move away from “insurance speak” and having the courage to be different. This is an immensely exciting challenge and one we’re rising to right now. We may not make it to one page of A4, but we can do better and we will.

    For me, flexibility is several things.  Yes, it’s about adapting cover to ensure it meets a customer’s individual needs, but it’s also about delivering this cover to them in the way they want it, whether through a broker, online, via a scheme or a tied agent, a social network or a technology yet to be invented.  It is about being available to them when they want and where they want.  And most of all it is about creating an experience so seemingly about me…or you….that buying anything else is just plain silly.

    And finally certainty.  Certainty is customers knowing without a shadow of a doubt that when something goes wrong, what they have bought from us will do exactly what they expect it to do. This is inextricably linked with simplicity and flexibility, but the certainty that we will deliver on our promise is what we have built our reputation on - doing what we say we will do, when we say we will do it.  So this, in the end, is the tangible demonstration of what we stand for and so is, to me, the most important customer need that we must meet.

    Unfortunately, the reality is that insurance for our most prized possessions – our home and the stuff we’ve worked so hard to accumulate - is often a grudge purchase with the expectation that it is unlikely to do what we thought it would do, and therefore bought soley on they basis of price.  This is a particular concern for those with unusual or complex insurance needs, such as high net worth individuals, where 80% of people continue to buy one-size-fits-all policies from direct writers, consumer brands or their local bank.

    As an industry, we need to do more to help people realise their belongings’ true value (both in financial and sentimental terms) and to explain the role of a specialist insurer and broker. This means that brokers and insurers need to work together more closely to really deliver on those core needs of simplicity, flexibility and certainty.

    So back to Apple and the “what if?” question?  If nothing else, it serves to remind us that we need to focus not only on how business is done today, but how it will be done tomorrow.  

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