1. Comment
  2. Comment
May 19, 2020updated 31 Jan 2022 10:13am

Direct to Customer Insurance: Product Development

By GlobalData Thematic Research

Digitisation is empowering customers to make more informed decisions. This has resulted in a shift in behaviour, with customers gradually moving away from purchasing insurance from advisors to insurance companies directly. This represents a significant change from traditional models. D2C models pose challenges to insurers surrounding product development in (often) digital-first models as well as developing customer-centric products.

Listed below are the top product development trends impacting D2C in insurance, as identified by GlobalData.


D2C models allow insurers to engage directly with customers, a role largely held by brokers in traditional (intermediated) business models. Insurers will be able to better understand customer needs and wants, and will be better placed to understand new risks and evolving customer behaviour. Greater customer interaction can allow insurers to improve the level of customisation and develop tailor-made products that better resonate with customer demand.

Digital challengers, which have largely focused on the D2C model, have been keen to enhance the availability of more customer-centric products. Digital challengers have not only created innovative products but have also made them simpler, improving the understanding of product features among customers as well as making them more appealing.


Regulators will continue playing a crucial role in product development. Regulators monitor product launches, ensuring they are fair and beneficial to customers. Coupled with the right technologies, insurers can use large volumes of data in product development, but regulators will dictate how this data can be used. This will be particularly relevant to on-demand and usage-based insurance products. Overall, regulators will be significantly involved in ensuring products meet data protection standards and are fair to customers.


The insurance industry has traditionally been heavily intermediated. Brokers have played an important role in product development, owing to their direct contact with customers. As insurers increase their touchpoints with customers, their reliance on the broker channel to gain customer insights will diminish. Brokers will likely need to look for partnerships with digital challengers to innovate and reach market niches in order to prevent being cut out of the value chain.

This is an edited extract from the Direct to Customer in Insurance – Thematic Research report produced by GlobalData Thematic Research.