Digitalization in Insurance

EIET CONFERENCE 2015

Agenda

1 Digitization in Insurance and it’s Impact on

Product Distribution

2 Business Context & Competitive Environment

3 Digital Customer Journey

AA

4 Digital Maturity and Alignment of Capabilities

5 Success Criteria of Digital Transformation

© Deloitte Central Europe 2

Digitization in Insurance
Embarking on the digital journey is not an option, but a necessity to sustain market position.

$
Insurer with Advanced Digital vs. Little or No Digital Capabilities

Gartner predicted
that, by YE16, digital
leaders in insurance
Market
will financially
Capitalisation
In just 3 years digitally progressive outperform digital
insurers outgrew those not investing laggards by 100%.
in digital capabilities by 36%
Insurer with Advanced Digital
Capabilities
Insurer X

Insurer with Little or No Digital

Capabilities

2011 2012 2013 2014 2015 2016

Digital progressive insurers generated an 83% increase in market capitalisation and a 62% return on assets (ROA) during
the 3 years between 2011 and 2013. By contrast, those insurers that are just beginning their digitalisation efforts
averaged a 47% increase in capitalisation and suffered from a 15% decrease in ROA during the same period.

© Deloitte Central Europe 3

 Impact of Digital on Product Distribution
Digital capabilities have become a critical „hygiene” factor as customer expectations are
turning towards a fully digital customer journey.

Digital Strategy Customer Journey Distribution Channels

BA DtC F2F EB
BUILD
Develop a multichannel
CONNECTED digital customer AWARENESS
CUSTOMER experience
CHANNELS
CONSIDERATION

DEVELOP Transform data into an

VALUE
CUSTOMER asset to be leverage by PROPOSITION
INSIGHTS Digital processes

INTENTION

ENABLE Establish a stable

PROCESSES landscape of core systems
AND and processes to support SALES
the customer journey
SYSTEMS
CUSTOMER
RELATIONSHIP
Deliver an authentic
ENGAGE WITH engagement by
CUSTOMER
CUSTOMERS personalizing customer SERVICE
experiences
Level of digital enablement Moderate Significant Critical
required in different channels

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Business Context & Competitive Environment
Analysis of life insurance trends and leading practices has shown that many insurers are not
in-line with the market.

Key market trends Positioning against market leaders

DIGITAL Strategic and deliberate use of Data

Management
technology to improve business models and
automate internal and external operations
5
USER EXPERIENCE Consistent, client-centric 4
user experience at every touch point on the
customer journey 3
Multichannel Advanced
ADVANCED ANALYTICS Providing in-depth Distribution 2 Analytics
views of the market that enable more meaningful
segmentation, inform product development, 1
risk management and underwriting, and enrich the
customer experience 0
DATA MANAGEMENT Data mining across 4
dimensions - internal, external, structured, and
unstructured

MULTICHANNEL DISTRIBUTION Omni-channel

capabilities, allowing flexibility for customer to use
preferred channel with the ability to switch
between channels without losing context
User Digital
Experience
Key:
EMEA Market leaders Industry average

© Deloitte Central Europe 5

Business Context & Competitive Environment
Many players are lagging behind market peers that are driving competitive advantage through
the adaptation of new technologies and leading practices.

SELECTED
EXAMPLES
Technology Advanced technology capabilities Comparison to best Best market practice*
theme practices
Web/mobile/tablet customer portal
allowing clients to view full engagement
DIGITAL Digitally enabled multichannel customer
with the insurer and enabling self-
UX experience with robust self-service offering
servicing (bill payment, product
purchasing, claims filing)

Web / SMS lead generation

DIGITAL Sophisticated agent supporting tools enabling Fast pricing with web quotes
UX digital pre-sales, sales and servicing Illustration software
Commission reporting solutions

Use of data and advanced analytics to

CRM support identification of cross-selling Leverage actuarial risk platforms to
opportunities, drive better understanding of develop CLV (Customer Lifetime Value),
ANALYTICS
customer needs, support customer propensity to buy models
segmentation

BPM
Mobile apps / on-off line capabilities for
KAMs with automated underwriting
TECHNOLOGY Ability to provide customers with a timely
function providing direct linkage
REFRESH and accurate insurance offer
DIGITAL
between sales and actuarial function to
deliver faster quotes to customers

CRM Customer data warehouse,

Data management practices enabling a
DATA standardised data structure, reporting
central view on customer data
MANAGEMENT tools and integrated front-end

PRODUCT
DEVELOPMENT Flexibility to drive product personalisation Easily configurable product platform with
TECHNOLOGY and engagement with short time to market fast time to market
REFRESH

Significant In line with

gap exists market leaders
© Deloitte Central Europe 6
The Digital Customer Journey
The enhancement of the customer journey is enabled through digital capabilities that support
all customer touchpoints.

Customer Journey Digital Levers

• Social Media
• Viral marketing
AWARENESS
• Content, Search Engine Optimisation (SEO)
A and Digital brand marketing
Gather • eEducation
Information • eAdvertising
CONSIDERATION
• Ratings & customers feed-back
F B • UX Journey Design – Connectivity
Ongoing Seek
• Social listening
Sales Advice VALUE
• Survey and research
PROPOSITION
• Analytics and Big Data
• UX Journey Design – Connectivity
• Product and Price Comparison
INTENTION
E C • eTools
• Remarketing
Claims Purchase
Policy • Lead generation/nurturing
SALES
• eSale (eSignature, ePayment, eFulfillment)
D CUSTOMER • Personalisation and targeted content
After Sale RELATIONSHIP • Cross-sell & Up-sell through Big data
Service
• Social Servicing (Twitter)
CUSTOMER
• eClaims
SERVICE
• eService

• Online Search • Buy Online • Submit Claims Online

A • Self-educate C • Automated Underwriting E • View Claim Status in Portal
• Compare Quotes • Paperless Policy Issuance • Share Experience with Social
• Targeted Advertising • Issue Review Online Network
• Receive Quote • Share Experience on Social Media

• Browse Reviews • Access to Portal for Policy • Targeted Advertising Based on

B • Check With Social Media Network D Amendment F Behavioural Analytics
• Validate Options and Suitability • Interact with Agent via Video Chat • Cross Channel View of Customer
Through CRM

© Deloitte Central Europe 7

 Digital Maturity
The level of digital maturity should be aligned across the customer journey to yield the
highest benefits

Customer AWARENESS CONSIDERATION VALUE INTENTION SALES CUSTOMER CUSTOMER

Journey PROPOSITION SERVICE RELATIONSHIP

UX Journey Lead Personalisation Social

Social Media eEducation Social listening Design – generation/ and targeted Servicing
Connectivity nurturing content (Twitter)
Product and eSale Cross-sell &
Viral marketing Survey and
eAdvertising Price (eSignature, Up-sell through eClaims
research
Comparison ePayment, Big data
eFulfillment)
Content, SEO Ratings &
Analytics and
Internet and Digital customers eTools eService
brand Big Data
Users feed-back
marketing
UX Journey
Design – Remarketing
Connectivity

Awareness Targeted A value Once the Quality and ease Level of customer Strength of the
building through messaging and proposition customer accepts of the sales integration and relationship with
online channels prospect developed based the value process will responsiveness to the customer is
strengthens the education results on customer/ proposition the determine the further sale offers driven by the
brand and in further prospect input quality of tools level of sales is driven by the ease and quality
generates engagement build acceptance provided will drive conversion adequacy and of engagement
prospects and credibility the sale quality of content

© Deloitte Central Europe 8

Alignment of Digital Capabilities
Digital enablement will drive business growth, but has to be equally applied to the entire
customer journey as opposed to fragmented capabilities.

Gather After Sale Service

Seek Advice Purchase Policy Claims
Information Ongoing Sales

CUSTOMER
JOURNEY

VALUE
AWARENESS SALES CUSTOMER CUSTOMER
PROPOSITION
SERVICE RELATIONSHIP
CONSIDERATION INTENTION

INSURANCE Product Marketing New Business/ Billing and Claims Policy admin
VALUE CHAIN development and sales Underwriting collections management and service

Lead generation
Product Predictive UW Collection Claims Customer
& campaign
personalisation model management management service
management

Streamlined
Automated
product Lead Automated Automated claim Policy admin
billing and
development management underwriting processing automation
reconciliation
process

REQUIREMENTS Customer
Digital sales Underwriting
FOR DIGITAL involvement and E-billing Claims statusing Self-service
process status
INSURER feedback

Customer Multichannel Real time Proactive loss Relationship

Intelligence E-payment
distribution underwriting adjust offerings Management

Data and Data and

analytics analytics New business
processing
Digital marketing Digital marketing
Digital capabilities driven by the customer path and
© Deloitte Central Europe touch points in the customer journey (Illustrative)
9
Digital Transformation
In order for Insurers to execute a successful Digital Transformation , the operating model
needs to be adapted to bring technology closer to the business.

TECHNOLOGY OPERATING MODEL

DIGITAL IT Delivery

Governance

Project Portfolio Management

Financial Management
DATA People & Organisation
Sourcing

The Operating model needs to align with the business strategy and identified business drivers for change in order to
deliver the required ROI on Digital enablement

© Deloitte Central Europe 10

 Data and Analytics in Digital Transformation
Successful digital transformation needs to be underpinned by robust data and advanced
analytics

DATA MANAGEMENT
DIGITAL ENABLEMENT
• SINGLE CUSTOMER CENTRIC EMEA

1 REDEFINE THE CUSTOMER DATA MODEL AND DATA WAREHOUSE

EXPERIENCE Build Connected
Consumer
Channels
• 360 VIEW OF THE CUSTOMER
DIGITALLY ENABLE
2
DISTRIBUTION • UNIFORM DATA STRUCTURES

3 GOING MOBILE • REAL TIME ACCESS TO DATA

DIGITISE PROCESSES ADVANCED ANALYTICS

4 Enable Processes
& Systems
5 DIGITAL MARKETING • ADVANCED ANALYTICS CAPABILITIES
CAPABILITIES TO ENABLE THE ANALYSIS OF
EXISTING AND PROSPECTIVE
6 ENHANCE CUSTOMER CUSTOMERS
ANALYTICS Develop
Consumer • DRIVE CAMPAIGNS ACROSS
Insights CHANNELS AND ENHANCE MARGINS
ACCELERATE DIGITAL
7 VIA STARTEGIC PRICING
INNOVATION
• LEAD GENERATION BASED ON BIG
DATA AND BEHAVIORAL
SEGMENTATION

© Deloitte Central Europe 11

 THANK YOU

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