The rise of digitisation has fueled a macroeconomic focus to the D2C movement that is now commonplace across industries, whereby companies reach out to customers directly and bypass third parties. The online channel has largely facilitated this, reaching out to customers is easier than ever: quicker, cheaper, and with no geographical barriers.
Listed below are the top macroeconomic trends impacting D2C in insurance, as identified by GlobalData.
The generalised rise of internet connectivity across the globe has led to a new generation of digital natives who have grown up using online channels and mobile devices. Digital-savvy customers are turning to online channels for an increasing range of transactions, and the insurance industry is no exception. Increasingly, customers are embracing digital touchpoints, from product purchase to processing claims. Some insurance lines have become increasingly commoditised as a result of digitisation.
The rise of the internet allows consumers to make better-informed decisions than ever before. Social media and customer review sites such as Trustpilot are further contributing to this, exposing customers to reviews of products and services from their peers. As a result, they feel more motivated to make their own decisions, as opposed to relying on financial advisors or other intermediaries. This trend is of importance to the insurance industry as it underlines the importance of the D2C business model.
Younger cohorts are digital natives open to the use of new technologies across all industries. Thus, younger generations are more likely to want to use technologies such as chatbots and connected devices for insurance purposes. In essence, customers today demand frictionless touchpoints 24/7, pressurising insurers to accommodate their needs.
Customers expect instant results. The connected consumer wants purchasing insurance to be straightforward regardless of the channel. This is pushing insurers to adapt their delivery methods and services to provide cover instantly, streamline the claims process as well as reducing queuing times in call centres.
This is an edited extract from the Direct to Customer in Insurance – Thematic Research report produced by GlobalData Thematic Research.