InsurTech Futures: Customers demanding “digital first”

Fujitsu study reveals that insurance consumers want to interact with providers on digital platforms.

A European-wide study by Fujitsu has highlighted the shift in consumer interaction with their banks and insurers as 'digital-first' demand continues.

According to the 7,000 consumers surveyed, digital plays an increasingly prominent part in their banking and insurance interactions, with more than a third (37 percent) threatening to leave their provider if they don't offer up-to-date technology.

"Digital is transforming each and every aspect of society and this has irrevocably changed consumer behaviour. Today's customers are no longer guarded and conventional," said Francois Fleutiaux, senior vice president, head of country leadership, EMEIA, Fujitsu.

He continued: "Modern day consumers are ready and willing to embrace innovation when it makes interaction more convenient.

"I think it is fair to say that they may not know where they specifically need it until it is offered to them and this is where technology comes to the fore - it is the engine that is driving consumer expectations forward and the financial services sector has to live up to this new pace of change."

Mobile
The study showed that 32 percent of customers are already embracing mobile device payments, while 22 percent have adopted wearable technologies and 20 percent use crypto-currencies.

Fujitsu said that this progressive consumer attitude has also led to a shift in expectations from financial service providers and a willingness to buy more services from them - 30 percent said they would purchase broadband from their bank or insurer.

On the flipside for traditional service providers a fifth of those surveyed also said they would buy banking or insurance services from potential disruptors like Google, Amazon or Facebook.

Traditional
However, the report also noted that traditional channels, although declining, remain important with over a third undertaking financial transactions in person and 36 percent preferring to use the telephone to speak to a provider.

Fleutiaux commented: "While there is no doubt we are moving towards a digital world, this shouldn't and doesn't mean that traditional channels are 'dead.'"

He continued: "For consumers, digital simply means a new way to communicate whether that be their bank, insurer or their favourite retailer - in whatever way suits them.

"'Traditional' methods and face-to-face interaction still have a place in modern-day banking and insurance; providers that will be successful will be the ones who modernise their back office to integrate these various channels to create 'banks and insurers of the future' that provide their customers with all options."

Data
Consumer attitudes to innovation have also impacted data sharing according to the research and 97 percent of those surveyed said they were happy for banks or insurers to use their data if it were used to offer them a wider range of services:

• Almost three in five (59 percent) would be happy for their bank or insurer to use their data to lower their mortgage premium
• Nearly half (47 percent) of consumers would allow banks or insurers to use their data to recommend relevant products and services
• More than two in five (44 percent) want their data used by banks or insurers to keep them informed of their spending habits and offer relevant advice
• More than a third (36 percent) would like their data used by banks or insurers to amend their credit rating
• Over half of consumers care about price and features when choosing an insurance package (65 percent). Price is most important to those in the UK (75 percent)
• Recommendations, brand, online reviews and tech services are least important factors when choosing an insurance package to buy

"The financial services sector must continue to build on its digital success and commit to on-going innovation. To be successful - and stand up to increased competition - it must invest in modernising its own infrastructure and participate in industry-wide collaboration to drive innovation," said Fleutiaux.

He concluded: "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."

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