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December 9, 2015

Insurers look beyond connected cars for IOT driven business boom

New: Race is on for big insurance in wearables, home and IOT based health

By

When it comes to IOT insurers are no longer exclusively focused on vehicle telematics as firms gear their portfolios across wearables and smart homes in order to survive in the digital era.

A survey has found that 45% of insurers worldwide believe that connected devices will be a driver of revenue growth in the next three years.

Accenture‘s "Reimagining insurance distribution: Insurers accelerate the shift to a radically different distribution model" report has found that over the last 12 months, companies have shifted from previously focusing on vehicle telematics to a more broad IoT landscape.

Nearly four in ten of the 414 senior insurance executives surveyed said they have piloted or launched a connected home and/or buildings offering (39%), a health/fitness offering (39%), as well as other wearables such as smart watches (37%). This compares to lasts years 14%, 10% and 4% respectively.

Today, introducing products and services based on IoT technologies is among the top investment priorities for insurers, with another being the improvement of data and analytics capabilities.

Nearly half of carriers already launched or are piloting projects using open data and big data analytics tools, and 58% said it is a high priority to use customer analytics at the point of sale.

The report has also found that carriers are embracing a customer-centric approach to create needs-based services with 59% saying that is important to move to a customer-centric model urgently in order to remain competitive in the future.

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63% said moving toward needs-based selling is a high priority, and advanced analytics will be an enabler for needs-based selling.

Today, 25% of insurers have a digital sales process, this is set to rise to up to 52% by 2018. One in five said they have no plans to implement a wholly digital sales process.

79% of insurers said they are redesigning their remuneration model or discussing how to create a new model to fit their new omnichannel distribution approach, as well as refocusing recruiting priorities based on the ability to cross-sell (50%), advisory skills around complex products (48%) and ability to build rapport with customers (48%).

Erik Sandquist, MD for Accenture distribution and marketing services in North America, said: "Carriers that analyse and use these new sources of customer data have a significant advantage over the competition, and will be best placed to offer ‘living services’ – which allow companies to personalise the customer experience and better respond to the evolving customer needs and desires as they develop in real time."

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