Insurance being a ‘grudge’ purchase has often been one of the biggest hurdles in communicating its value to customers, and, according to one broker, giving customers a slightly different offering may be the way to start changing that.
Frank Risk Management director and senior broker Rene Swindley says that due to changing customer expectations and the advance of insurtech, ‘business as usual’ may no longer be an option. He says that in the near future, insurance may actually become a ‘secondary’ product with clients paying primarily for other offerings, such as flexible and fully personalised business management tools – of which insurance will be just one part.
“We want to challenge the market to do business the way we do it, which is by using wrap-around tools for risk management designed for the customer,” Swindley explained.
“However, there is still and will always be a place for the broker to provide advice for complex risks, and there are plenty of those.”
“‘Business as usual’ is broken in the industry,” he continued. “The next generation is not buying on price, or on $50 prezzie cards – they’re buying on value, so we need to change direction and provide that value. Scott Walchek was one of the original insurtech pioneers, well before the likes of Lemonade, and he asked what would happen if you could give individuals control over the information about the things they own. He ended up being prolific in designing a tech platform that allowed people to manage their property and turn cover off and on as needed.”
Frank Risk Management currently has a digital brand called Frankie, a full client-facing tech platform, and also owns domestic brand Initio, a digital underwriting agency for domestic insurance. Swindley says these were built from scratch in-house by people who work in insurance, and they give clients the freedom to get quotes, manage claims and adjust their insurance as necessary.
“Insurance as part of these offerings is actually becoming secondary – that is, people don’t feel like they’re buying insurance,” he stated. “If a business can get to that level, that can be pretty amazing.”
“This is just the beginning. The buyer of tomorrow won’t be thinking of insurance as a primary service – it will be secondary to other core business offerings and personal management tools.”