Insurers must better leverage technological evolutions

To keep its competitive advantage, the Luxembourg insurance industry must evolve by better integrating the new tools and technology available.

Accenture, a provider of advisory, strategy and digital services, and Bâloise, a major insurance company, have released the first-ever joint survey of the Luxembourg insurance market. « The sector has for long been slowed down by tradition, but it is now rapidly changing, says Emiliano Luzzi, Insurance Lead at Accenture Luxembourg. With this survey, we wanted to better know and understand how insurance companies are perceived in Luxembourg, what the insured think of their insurance providers’ products and services, but also what are their expectations, current and future needs. We want to make sure they are satisfied. »

 

Emiliano Luzzi, Insurance Lead – Accenture Luxembourg

Indifferent customers

With 1,000 people interviewed, the Luxembourg Insurance Market Pulse Survey concludes that the insured are indifferent towards the provider they choose. Six out of ten respondents said that if they could start from scratch, they would switch provider.  « Customers keep their insurance company mostly out of habit or because of its good reputation, says Emiliano Luzzi. One other thing is specific to the Grand-Duchy: customers don’t think that the price is a determining factor when choosing to stay with or leave an insurer. Rather, what matters to them is the high quality of services. »

Most customers don’t meet frequently with their insurance company. « 92 % of them said that they have very few opportunities to interact with their insurer, which means that those moments are even more important. Each brief interaction is a chance to positively reinforce the relationship between the insured and the insurer, or to impair it », adds the Accenture insurance specialist.

 

Combining the physical and the digital

How can insurance companies be closer to their clients so that they’re no longer indifferent? How can they avoid running the risk of seeing the clients leave?

« Insurers must change how they communicate by trying to integrate the “phygital”, a combination of physical and digital channels », says Emiliano Luzzi. Digital tools can be used for example when contacting the company, sending an intervention request, or checking the status of an open claim. Whereas physical meetings should be favored when tailored services are important, such as when the customer wishes to be advised on the type of insurance he should subscribe.

« The sector in Luxembourg must evolve by changing its physical model and building on its existing strengths while leveraging the new technological and digital tools, which are scarcely used compared to other European countries Using both digital and physical communication, with a human approach, must help identify and personalize the services each client requires, at the right time. »

 

Beyond insurance

Insurance companies must also think of new models and new services for their clients. « This means looking beyond the insurance sector itself, adds Emiliano Luzzi. Insurers must propose to their clients more than what they’re just expecting today. » The survey shows that opportunities exist to create innovative services: intelligent solutions based on the Internet of Things; for housing and healthcare; insurance for pets; cybersecurity and e-transport services. « Such products are already being offered by some insurance companies in other countries », says Emiliano Luzzi. What’s more, 66 % of respondents said they would be interested in receiving computer-generated advice for certain services, while 77 % are ready to pay for niche insurance products.

More than ever, the sector must reinvent itself. « In this changing market, if insurance companies want to remain close to their clients, build long-term relationships, and stay ahead of the competition, they need to innovate by offering diversified products and services, with a more direct and tailormade approach », adds Emiliano Luzzi.