Mobile technologies are radically changing many industries and they have great potential to transform the insurance industry. Indeed, according to recent research by The Economist Intelligence Unit (EIU), 62% of respondents see mobile as offering unique capabilities with the potential to change the insurance game1.
The reality is insurers are forging ahead with new mobile products and services for their customers. Usage-based insurance, one-off products, location-based recommendations, and health monitoring are just some of the new developments that are being pioneered.
But has anyone asked consumers what they want or are prepared to accept? It seems not. The same EIU research that found insurers to be bullish about mobile technologies also polled consumers around the world. And it found that insurers and consumers are somewhat at odds in their attitudes to mobile insurance.
Insurers see the benefits of collecting data about policy-holders, but consumers are not convinced. In fact, seven of 10 policyholders (70%) say they would be strongly or moderately concerned about their insurer collecting and using their personal information to personalize products and services. Almost as many (67%) would feel the same way about insurers collecting personal data to discourage risky behavior1.
What are the lessons for insurers? First of all they must be able to clearly demonstrate the benefits of collecting individual consumer data. The advantage may be lower premiums, more proactive healthcare, a lower risk of accidents, or complementary services. But, whatever it is, the consumer has to understand the value they are getting for sharing their data. Secondly, insurers that forge ahead without getting their policyholders on board, or offering the expected privacy protection, could be putting themselves at risk from a backlash.
While the insurance industry is lagging other consumer industries in mobile consumer proliferation and embrace, a few are doing it right.
Read the full EIU report here to see what some of them are doing.
1 Source: From protector to partner: Can insurance expand insurers’ relationships with consumers?