The internet is gradually becoming a trusted source of advice about insurance policies, according to Swiss Res latest Digital distribution in insurance study
Published yesterday and based on research from different countries, the study showed that the internet and mobile devices were empowering consumers. Its analysis recognised that people could now search, review and purchase insurance policies without relying solely on the services of a middle man.
The analysis noted that in many countries the share of premiums accounted for by online sales was small, but rising. Swiss Re's chief economist Kurt Karl said 'a quiet revolution [was] on the way'.
He went on: 'The statistics on e-commerce insurance mask the profound impact new technologies are having on the distribution process.'
Ginger Turner, co-author of the report, added: 'With mobile and telematics technology, consumers can now interact with their insurance provider anytime and anywhere.'
At the same time, however, the study suggested that innovations in Big Data were creating access to a rich source of facts about consumers, which insurers can use to boost sales and marketing strategies. The analyses argued that middle men could still play a key role, but would need to adapt to their customers changing needs and preferences.
For instance, aggregator or price comparison websites, as well as social media, were playing a growing role in the pre-sales process, since their introduction in the early to mid-2000s.
Personal motor and property insurance were highlighted as being sold online more readily in developed markets, the study noted. And direct marketing of term life insurance and some insurance for small businesses, such as professional liability cover, was noted as also becoming prevalent.
The Swiss Re analysis showed that insurers in emerging Asian markets where most sales occurred via intermediaries had more advanced web offerings in terms of allowing customers to purchase and amend polices via the internet.
Purchases through social media sites are still emerging, though for many insurers, developing this distribution channel was a priority, the analysis found. For instance, Malayan Insurance Company in the Philippines already allowed customers to buy several of their insurance products, such as travel to fire insurance, on Facebook.
The study notes that not all insurance sectors were at the same stage of digital transformation. In Australia, for example, price comparison websites had failed to take off significantly because major carriers refused to participate with aggregator firms.
But the direction is clear, said Swiss Re. Globally, digital channels would ultimately be used throughout the insurance distribution process, from information gathering, to purchase completion, to after-sales service.