The survey of 7,000 consumers across Europe found that almost 20% would buy insurance products from digital giants not currently in the space – such as Google, Apple, Facebook and Amazon. That figure is even higher in the UK, with 23% happy to ditch traditional insurers if the opportunity arose.
Up-to-date technology is a critical factor, and while BIBA executive director Graham Trudgill accepts the ease with which customers can transact with online giants offers the insurance industry lessons, there are inherent risks if such a scenario came to pass.
“The Amazon buying model is popular and there are things that we can all learn from their success in engaging with customers,” said Trudgill. “However, buying insurance is not like buying the types of items you normally order from sites like Amazon – it’s a contract to protect you and your assets should the worst happen. Not all insurance policies are the same and having a professional help get the right cover for you – which pays out when you need it to – is precisely where a broker can offer value and choice.
“The regulator is concerned about some comparison sites having an unhealthy focus on price, rather than quality, and that is a concern that we share. It is possible to reduce cover and decrease limits in order to achieve a cheaper premium, but we have to question whether that is in the interest of the consumer.”
The survey’s respondents included 1,000 British consumers and while it will come as no shock to learn they tend to buy on price (75%), insurers may be more surprised to learn the public are quite happy for their personal data to be used to save them money – 97% of all those surveyed said they would be happy for their insurers to offer them a wider range of services.
In the UK, that translates into a sizeable number of consumers who would be happy for their insurers to branch out and offer them more products and services, from energy deals to mobile phone contracts, broadband, pay TV and even personal data storage for digital copies of passports and other important documents.
Cyber remains a buzzword within the industry and there’s a word of warning from UK consumers – 58% say they would switch insurer in the event of a data breach.
“The Financial Services sector must continue to build on its digital success and commit to on-going innovation,” said Francois Fleutiaux, Senior Vice President and Head of Sales at Fujitsu. “To be successful – and stand up to increased competition – it must invest in modernizing its own infrastructure and participate in industry-wide collaboration to drive innovation. Working with the industry and suppliers, banks and insurers can ensure new channels, services and technologies see mass adoption. Ultimately, consumers want evolution; the modern-day Financial Services sector must come together to boldly embrace this, or risk being forgotten.”