Novarica’s recently published report, Insurer Digital Strategies: Current State and Post-COVID Plans, presented the results of a survey asking the Novarica Research Council about their organization’s digital strategy. We asked insurers to score 13 digital capabilities on a four-point scale based on how important that capability is to their digital strategy.
As described in the report, factor analysis across the resulting scores showed that insurers tend to take four kinds of approaches:
- Traditional e-Business: These organizations focus their digital strategy on agent portals, customer portals, or mobile functionality.
- Digital Marketing: Digital advertising, the public website, SEO, and social media are the areas where these organizations focus their digital strategy.
- Digital Operations: These organizations focus digital on more internal processes and capabilities, such as APIs, integration with InsureTechs, and the digitization of core processes like billing, claims, and underwriting.
- Broad Focus: This is a hybrid of the other three categories, with efforts more diluted across multiple capabilities.
When asked about what was considered “in scope” for digital, over 90% of respondents agreed that customer engagement and service were part of it. But what does “customer engagement and service” mean to each of these four categories of digital strategy, and how can we measure it?
For traditional e-business, customer engagement and service are centered on the customer and agent portals and their mobile counterparts. Success is measured directly by looking at how much traffic is being routed through these portals. However, just because an agent or customer enters these digital assets does not mean they are successful and satisfying experiences. Care should be taken to look at task completion rates, session abandonment, call center routing, and intercepted VOC as part of the measurement of these portals.
Traffic is also important for organizations whose digital strategy is focused on digital marketing. These insurers are looking at traffic in terms of the public website and digital marketing channels like search and social. Metrics tend to focus on consumer engagement—content consumption, repeat visitation, or making it through a conversion funnel. Unsurprisingly, this group was most likely in to use revenue as a success metric for digital. The importance of understanding the ROI tied to paid marketing channels may initiate the development of revenue proxies, lifetime value calculations, or CRM integrations.
Companies whose strategy revolves around digital operations approach the customer through the digitization of core processes such as claims, underwriting, and billing. More than 90% of these companies directly measure customer satisfaction and net promoter score. While these are good brand-level metrics, it is important that these satisfaction surveys be triggered during the online experiences themselves in order to put these scores in context and quickly identify the need for any specific changes to the user experience.
Companies with a broad focus approach to digital may have the biggest opportunity to be customer-centric. Some of these companies are just getting started in their digital strategy; they can develop capabilities centered around the customer experience from the ground up without being encumbered by legacy systems. Or they may be truly broad-focused, spreading digital across portals, marketing, and core systems, in which case customer-centricity could develop organically out of all these initiatives.
While insurers are taking varied approaches to their digital strategies, they are all focused on customer engagement and service. The customer experience is consistently evolving; to learn more about how insurance carriers are striving to improve their service, read the full report or reach out at [email protected].
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