Securing the future

Today there is a deep look at the crystal ball. It comes down to the question of what securing the future might look like. And why the insurance companies have no choice but to seek cooperation.

A large survey conducted by the consulting firm Capco last year provides clues to how insurers should act in order to reach customers in the future. Highly recommended reading for managers in the insurance industry. After all, the company asked 13,000 people from 13 countries, including Germany, for their wishes and opinions about insurance.

Customers feel badly informed

The study indirectly confirms EPAM’s findings in one area: The company discovered that customers rate insurance companies’ digital operations worse than companies do.

One reason: insufficient explanations about products and backgrounds. Also, the result of the Capco study is not very good. 37 percent of consumers do not feel well-versed in the insurance and products currently available.

The clearly neglected target group are women who, in 12 out of 13 countries, do not feel sufficiently informed about the products offered.

© Capco

It remains to be seen if this discontent will be enough to launch new models, as is typical in the fintech sector with sectors. Perhaps it makes sense for the industry to get more involved here, any kind of green fin for insurance companies.

However, the transfer of insurance knowledge is high on the agenda of the society.

Customers will share their data to get better offers

As Capco found, 72 percent of customers would be willing to share personal information and data if they could get cheaper rates. According to the survey, data is actually passed in these areas (in descending order of importance):

  • fitness and health
  • smart home
  • Wearable (smart watch, etc.)
  • Social media
  • car

In other words, it is about (excessive) personalization. It’s not everyone’s only insurance, but it’s “insurance for me”: that’s what customers want.

However, not all insurance companies have reached the technological level where they need to be in order to implement this on their own. Thus, the “Telematics” area is pre-set for collaboration with insurtechs, fintechs and those outside the industry. This is the only way to bring products to market at the required speed that takes into account the desires of customers.

No high potential

The study provides another interesting number. 60% of the insured have no more than one insurance policy with one provider. So there is a huge untapped sales potential. This can be raised if firms pay more attention to the aspects just mentioned, i.e., impart understandable financial knowledge on the one hand and at the same time make more personalized offers.

Perhaps this also includes saying goodbye to the idea that customers are always served only through their direct channel (online or broker sales). In view of enormous cost pressures (administration, operation, and sales costs), sales opportunities call for collaboration and alternative models such as built-in insurance. However, this requires more than simply incorporating classic products into banking or establishing policy in the e-commerce path.

classic crunch life insurance

Fat Returns and Huge Commissions: Life capital insurance was once the child of the insured and Germans’ favorite in the context of old-age savings. However, insurance companies have had difficulties investing the money profitably due to years of low interest rates. Companies groan over contractually guaranteed amounts. So it’s no surprise that only 21 out of 46 companies still offer life and retirement insurance contracts. This was determined by the latest Assekurata classification.

The 0.25 percent guaranteed interest rate set by companies is a bit more attractive than a bank custody fee, but it’s hardly adequate for asset creation. Insurance companies have turned around and are increasingly focusing on opportunities in the capital markets. Insurance companies invest the savings portion of the policy in stocks and funds.

But so do others. And sometimes better. Just think of the countless fintech companies that target the young target groups with smart digital operations and make investing easy and convenient. They emphasize opportunity and ease of operations and offer classic savings plans for very small amounts. For their part, they have the advantage of not having to deal with cumbersome terms such as “guaranteed sums”.

Platforms and Ideas Needed

Problem: If the company permanently positions itself as a banking and supply partner, an important area of ​​business for the insurance company will be lost. In order to maintain access to customers, added value is needed. It also explains Allianz’s current strategy of wanting to build a platform. It should also specify bank accounts and financial conditions, not just the handling of insurance.

© Capco

This also aligns with what customers want, Capco’s study shows. According to this, 66 percent of those surveyed will use an app that not only transmits individual insurance information, but also provides transparency about all financial products (bank accounts, retirement plans, insurance).

This race to reach customers and create personalized offers has yet to be decided. Insurance companies, as well as banks, will have a say in this matter. Because one thing is also clear: Insurance companies have a long way to go here.


Stefan has been online since the early 90’s and has a strong past in financial technology (Star Finanz, Hypoport). In Hypoport’s subsidiary d. As a junior, he was responsible for product management and business development, among other things. He’s been writing about…more for over 10 years

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