The last few years have certainly been testing for the insurance market. But there’s good news: the insurance industry is set to recover faster than the wider economy in the wake of the global pandemic, despite the fact that the two generally move in parallel over the long term. Hard times have hit many industries, yet – impressively – the international insurance market marches on. So, in this new, post-COVID world, how can insurance brokers successfully adapt to meet the evolving needs of their increasingly digital customers and stand out from the crowd?
How can insurance brokers create meaningful connections, generate engagement and build long-lasting customer relationships in a digital world, where customer expectations of speed, personalisation and convenience continue to become ever more sophisticated? What does leading-class medical insurance look like today? And how can insurance brokers improve their digital experiences and customer engagement? We explored these questions to provide you with top tips and ways to increase innovation and improve digital experience at your insurance brokerage. Read below to find out what you, as a medical insurance broker, can do right now to adjust to the post-COVID world.
How has the COVID-19 pandemic impacted international insurance?
COVID-19 has significantly impacted the global economy, with the IMF forecasting an average contraction of 4.4%. 2021 also marks the end of the Brexit transition period.
Despite all the drastic transformations in the public and private health sectors over the past few months, and the significant changes to how we manage our lifestyles, the health insurance market is one of the global sectors least impacted by the COVID-19 pandemic. The insurance industry is very entrepreneurial, and the winners are those who are embracing technology and engaging with it across the full product and customer lifecycles. This, we believe, suggests a great commercial opportunity for insurance brokers in a post-COVID world:
- Based on 2020’s retention performance, insurance customers value their health and protection benefits. No-one is keen to relinquish their chosen insurance plans, unless no other path is available.
- Customers are still willing to make financial commitments to protect their health, life, and income, provided there is flexibility, choice, and trust.
- Vulnerabilities exposed by the pandemic have given rise to a flurry of interest in life insurance.
- We’ve learned to live with new ways of engaging customers digitally and concluding policies. This might mean servicing customers remotely, or issuing terms digitally where we previously might have sent physical copies in the post.
How can insurance brokers successfully adapt to the post-COVID world?
Best-in-class insurance offerings are achieved by those medical insurance brokers who focus their entire business — their philosophies, ethos, business model, people, culture, processes, and technologies — on the delivery of value to their customers through digital services and compelling experiences. Connectivity and distribution are now both Big Agenda items for today’s medical insurance brokers. In fact, over the last 12 months the adoption of technology within the insurance industry has been so fast, that the market is now using more and more technology to help it continue its rapid growth journey. So how exactly has technology evolved for insurers?
We’re entering a new era of working and living, which represents expansive opportunities for digital transformation. But first, we must remember the value gained from human contact.
The pandemic has seen businesses having to evolve and adapt as their customers spend more time at home, many of whom have embraced the digital environment as their means of interacting, working and purchasing. The last 18 months has seen remote working become normal. Now, as we tentatively emerge from the pandemic, many organisations are rethinking the traditional 9-to-5 office culture, whilst considering and consulting with staff on introducing hybrid working (e.g., a mixture of office attendance and remote working).
People are making new choices about where they want to live and creating new expectations about flexibility, working conditions and life balance. So, with tech by its side, it seems that the future is extremely optimistic for the insurance sector. New products are continually being launched, slick online customer journeys are being created and, with the use of data, more and more insurance is being tailored to meet customer demand at the touch of a button.
8 ways insurance brokers can adapt to these new business challenges
The argument for change in medical insurance distribution has existed for some time, particularly for those insurance brokers that have recognised how their legacy systems are inhibiting business development opportunities. Further, COVID-19 has had a significant impact on customers’ expectations, as more young and old people alike have become more used to the convenience of an online-savvy, remote working, home delivery lifestyle.
Now is the time to set real and clear expectations for the customer and introduce a strong level of engagement. The entire customer journey may have been digital to this point, but introducing a human touch and begin to build a lasting relationship by getting to know the customer through a proactive touch point can help. The working from home business model driven by the pandemic has seen insurance brokers interacting with customers in their own homes, from their own homes. The mutual understanding of working in the home environment, with its associated distractions and fleeting appearances of children, pets and family members, plus deliveries at the door, has created a human connection in what was otherwise often a transactional experience. There is an appetite to maintain this empathy and generate a more customer centric experience, starting with the first customer interaction and continuing throughout the relationship.
Read below for more ways insurance brokers can adapt to post-COVID world to growing their business further:
1/ Diversify your insurance expertise
The greater the range of broker support you can give your insurance customers, the greater loyalty — and potential revenue — you stand to gain. So if, like many brokerages, you specialise in a single benefit, now might be the time to demonstrate your value to your customers by expanding into other areas. For example, if you currently only offer international health insurance, you could think about expanding into other benefits such as income protection.
2/ Start cross-selling
For you as an insurance broker, cross-selling is a powerful way of demonstrating greater value to customers by offering them more. It makes customers more loyal and there are lower acquisition costs when dealing with customers you already hold.
3/ Use consultancy to stand out
There is no substitute for qualified experience in the insurance distribution world. While customers have plenty of choice when it comes to intermediaries, those medical brokers who offer consultancy and advice can differentiate themselves in the market. As well as helping to win new business, consultancy can result in happier customers, enhancing value and loyalty.
4/ Review and evaluate
Customers’ requirements and budgets will change, particularly given the impact of COVID-19. Constantly evaluating and reviewing your arrangements will help you as an insurance broker uncover opportunities to offer new and/or alternative cover solutions. Plus, it will lead to happier customers and possibly, increased revenue.
5/ Consider PMI-Lite with William Russell
Lighter versions of traditional plans will still offer significant scope within the insurance distribution model, but — with limits and benefit caps baked in — there is an opportunity to contain costs and an inherent benefit in terms of premium requirement. PMI-Lite is definitely something to be talking to your insurance customers about. It has appeal for existing customers as well as new business potential.
6/ Choose your segments carefully
Some insurance industry verticals have been less affected by COVID-19 than others, so you may want to focus on these. Age demographics are another thing to look at. The average age of an IPMI subscriber is somewhere in the region of late 40s to early 50s. For the market to perform well, a younger demographic needs to be bought into play. So it’s incumbent on all of us to think about how we appeal to younger age segments by focusing on the longer-term value of international health and risk insurance.
7/ Work with providers on digital marketing
In a post-COVID world, effective digital marketing is essential to leverage new and existing insurance business, and it’s an opportunity for us to work more closely with our broker partners. Marketing departments will be keen to lend their expertise on digital strategy, whether it’s in producing culturally-nuanced material or running joint campaigns for cross selling. It’s an area for insurance brokers to focus on and we will very much lend our support.
Recommended content: sign up for our free online webinars for insurance brokers
8/ Move beyond expats
While they are still a significant source of international insurance business, expats are now less dominant in the market for international private medical insurance. Other groups, including local nationals, remote workers and students are important potential sources of business. So, you need to include them in your prospecting net.
Recommended content: Recording of a webinar where we discussed tips like this (watch the full webinar).
Thinking of delivering more growth to your insurance business?
Tinkering on the margins to digitally enable functions or touchpoints is not sufficient. Insurance brokers must get beyond siloed views of automation and adopt a thorough, end-to-end customer-first point of view — clearly articulated by senior leadership and adopted by all parts of the business.
To discuss all this, we held a free webinar for insurance brokers on how to give more value for your customers on 20 October 2021. With our 30 years of experience, we have a lot to share!