When you think of digital distribution, what comes to mind? Usually, it’s visions of faster processes and even speedier go-to-market timelines, but for insurance the potential is much greater – digital distribution can transform outdated solutions and processes that have defined the industry for decades.
By breaking down long-established silos, digital distribution platforms centralise the management, distribution and promotion of insurance products. That opens the opportunity to discover revenue streams, boost sales, reduce overhead and remain innovation- and value-focused; plus insurers can improve their decision-making due to data being centralized into one platform rather than several offline ones.
Our recent e-book explored digital distribution and the massive imprint it will leave on insurance’s future. Here, we’ll take that examination a step further and get into specifics on how to create a digital distribution hub built to grow revenue numbers.
For digital distribution to thrive in insurance, a platform needs to be stable while still retaining the flexibility to adapt when the business grows. Those attributes should include:
Digital buy-in from your customers
Tech-savvy customers using a digital distribution platform sounds like a given, but this is a step that shouldn’t be taken for granted. Thanks to an array of established legacy processes and tools, offline workflows remain the go-to for many insurance customers – getting those users invested in digital channels can be the key to seeing distribution platforms gain traction.
We know the value AI provides personal line insurers, including quote and sales automation that can yield customer-friendly prices, but look for opportunities to tout tools like “Next Best Action” (NBA). Online personal line providers can use NBA to cross- or upsell policies to build more comprehensive coverage options that resonate with customers.
Digital distribution can gain additional credibility with users by making claims submission and processing easier, enabling them to be tracked in real time and simplifying integrations with external solutions. Build excitement around digital distribution platforms by sharing these capabilities and the value they provide end-users.
A next-generation, consumer-connected mindset
Digital distribution empowers insurance to happen on a customer’s terms, thanks to the use of innovative resources and finely tuned data insights. These digitally enabled tools can use real-time insights to tailor services to what the end-user needs at that very moment.
What does that look like? In parametric insurance, a strong digital foundation allows insurers to identify critical moments when they happen so a timely policy-mandated payout can occur. For embedded and specialty insurers, digital can strengthen the support provided by adding insurance coverage to flights and other purchases during checkout. Committing to digitally enabled solutions can streamline touchpoints, breakdown long-established insurer-customer silos and provide protection when customers most need it. In turn, this creates an experience that engages customers through multiple channels and puts insurers on track to reach ambitious revenue goals.
A high-touch, high-value audience
With a wealth of data fuelling them, digital distribution platforms can add a newer, more human layer to the service insurers provide. A digital distribution platform will enable you to have the information you need to be able to better interact with your high-touch, high-value customers.
Platforms can pull data from myriad sources to learn what they need to know about a customer (i.e., past behaviours and variables) to properly assess risk. Data gives platforms and insurers the strength to be proactive with the service they provide and present an overall more-personalised customer experience – the kind of pleasing journey that can potentially keep customers in the pipeline for the foreseeable future.
Digital distribution platforms should be constructed with enough flexibility so cloud solutions can expand to meet changing storage needs – these foundational values can keep the solution on track to continue to exceeed customers' expectations.
How to build a digital insurance hub
How can insurers construct a digital distribution platform that’s built for long-term revenue generation? By making sure you:
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1. Pinpoint needs and objectives
What defines your company? Are there specific goals, challenges and targets that are unique to you? If so, it’s absolutely critical that your digital distribution setup aligns with those elements.
Determine what growth and success look like, then support those with key performance indicators. Once you’ve figured those out, set up a strategy for your platform with those targets in mind to ensure the technology aids the pursuit of those goals.
2. Acknowledge your capability gaps
Whether you’re just building a distribution system or you’re adding to an existing one, it’s important to stay aware of where your platform can help you improve. Stay in front of potential barriers by regularly assessing gaps within your workflow and building a system that addresses them.
These issues can be immediate (i.e., infrastructure lapses and data security) or they can be coming down the line (regulatory changes and compliance). No matter the case, make the improvement of your platform a top priority.
3. Identify the right AI use cases
AI is a building block of any distribution platform. That said, AI operates best when used strategically, so identify distinct areas in which AI can augment your distribution platform to open up new revenue streams or lengthen current ones.
Will AI help underwriters work faster by extracting information from submission forms? Can it review different policies to determine the best option? Will AI improve cross-selling and NBA processes? See where AI fits into your platform so it can act effectively.
4. Build strategically
Needs, goals and AI applications should factor heavily into what kind of digital distribution platform you create. By answering those questions, you can craft a solution capable of complementing your customer journey.
Think about what kinds of tools you’ll need to make that ideal experience happen. AI is a start, but what other solutions might the platform need? What part of the customer journey will they support? Come back to these questions regularly in your build to create a digital experience that aligns with the needs of your team and customers.
5. Prioritise quick wins and longer-term ones
Do you have quarterly goals for your distribution platform? If not, mark down short-term, achievable revenue-generating benchmarks that can help validate the solution’s value within the first 3-6 months. And log your progress toward each target along with any obstacles or opportunities encountered along the way.
What about goals for the first year? Set these up concurrently with the short-term targets and keep track of where they stand and how far off they are. Keeping quick wins central to big-picture revenue goals ensures your distribution system can remain a relevant resource to your operations.
Revenue increases open a world of possibilities for insurers, enabling them to continue providing relevant and supportive coverage options for customers. With a well-built, strategically constructed digital distribution platform, insurers can remain focused on those revenue goal and provide services that regularly serve and engage customers.
Do you want to take a deeper dive into digital distribution and the opportunities it provides specific areas of insurance? Grab your copy of “Realise the Opportunities Digital Distribution Provides” here.