This piece is by Jan Houlberg CEO at Visicover

After you have answered the question let’s look at some of the reasons for considering Self-Service.

We need to define what we mean by Self-Service

Maybe we should call it Policy Administration Self-Service? What we mean by self-service is that the customer can make any policy change they want, i.e. any change that can be done by the back-office. That includes New business, Renewal and Mid-Term Adjustments. Many insurance providers claim they can do self-service but they only mean address changes, payment card changes or other simple transaction, and that is missing the most essential Insurance Self-Service element!

Customer experience

Customer experience is a good reason for self-service, and looking at Visicover who is a provider of Aeroplane, Helicopter and Boat insurance, all products that are reasonably complex, and who offer proper self-service, we can see that some of the metrics are compelling:

• Trustpilot score: 4.9
• Net Promoter Score (NPS): 82
• Policy transactions done by the customers in 2025: 99.93%

Customers have other values than just price and being covered, e.g. the ability to do their purchase and make their changes in their own time. It is more relaxing to be able to do it without being on the phone to a call centre. We are used to shopping online, and we are able to do our banking business online, and today few would choose a bank without online banking. Who says it won’t be the same for insurance? Will we not see the same digital engagement in insurance as in other industries? We must expect insurance customers to have the same expectations as in other industries.

Remember to Change

We live in a changing world and customer behaviour is changing rapidly. Very few are not embracing online and most are expecting it. We should not be looking at what the insurance industry is doing, but how people shop and manage their lives, and it is interesting how the generational divide has been eroded.

Jack Welch of GE said “Change before you have to” and that “You have to seek change”. Look at the current UK general insurance landscape and consider who dominated it before the Direct revolution (Telephone and Internet). A large share of the market is now taken by companies who didn’t exist before and saw opportunities. The rest should have listened to Jack Welch.

In research from 2020 [1] Capgemini say “Have it your way – Customers want personalised engagement; make that hyper-personalised engagement” and go on to illustrate experience-led engagement across the entire lifecycle – from product design to distribution to engagement. The right experience is: Right offering – Right channel – Right time.

They continue: “Personalised, experience-led, and convenient engagement is capturing the attention of information overloaded insurance shoppers as well as those who may need information but turn a blind eye to same-old/same-old product centric communication.”

Innovate to Change

Digital innovation is the enabler for business functionality, and it is not enough to say we want to be digital, without putting the right solutions in place. The right solution is the basis for a successful implementation. For policy administration self-service, the technology can be complex and it may be where most providers come up short. However, it just has to solve a very common business transaction.

Product innovation

Technology aside, if you want to offer products in a new way, it is important to ensure your current products are fit for purpose, or whether this is a good time to restructure and target them to the new distribution philosophy. If we are talking self-service it is almost certain that we need to redesign the insurance products we want to offer.

Example of product change – Product disaggregation

Product disaggregation is a double-edged sword for insurance companies. The more their products are disaggregated, the higher the ‘risk’ that a policy needs amending. That is why many insurance companies bundle a lot of covers together, regardless of whether the customer needs them or not. The downside of that approach is that the product becomes more expensive for those who don’t need the extra covers, and they may go elsewhere. And if the company lose the customers who are paying for risks they don’t have, they risk underfunding the rest of the portfolio.

With proper self-service, where the customer can add and remove covers as their needs change, it becomes a win/win situation for the customer and the insurance company. The customer will only pay for the risks they have and the insurance company will be able to accommodate both the high and the low risk customers, and charge appropriately. And there is no administration cost for the company.

Example of huge benefits – Avoiding underinsurance

The value to the customer of proper insurance self-service is well illustrated by a product we all know, home insurance. According to a study at AXA insurance [2], many customers are in danger of being underinsured. They emphasize that people should specify expensive, high-risk items like laptops and watches on their insurance policy because they’re easily stolen and resold. But it’s often both difficult and expensive to add an item to a policy, or to remove it if it is sold for that matter. Customers are expected to update their insurance details once a year, at their renewal, and not when they actually acquire the items, e.g. the new laptop. How often does it happen that a customer adds a laptop to their specified items, mid term? To be able to do it at the Right Time, without an expensive admin fee, is of great value to the customer as they could lose a lot by not being insured, but it is also of value to the insurance company as they are able to insure the items for extra premium, with no administration cost at all.

Reduced cost

Most insurance companies will find the reduced cost of customer service appealing. We have seen how bank branches are closing because there simply isn’t a need for them. Besides the potential for improving the bottom line the cost savings have other benefits, such as being more competitive and thereby growing the business. And more competitive prices naturally also benefits the customer.

Build customer loyalty

Focus customer service on adding value rather than doing tasks the customer might well do themselves. In that way the company can build a real service culture, appreciated and valued by the customers. Combine the high quality customer service with the ability to do self-service, and with lower cost to provide competitive premiums, and you will have the loyalty of your customers for the long term.

So back to the question. Why are so few offering real Self-Service? Please leave a comment.

References

[1] –  https://worldinsurancereport.com/wp-content/uploads/sites/6/2021/05/World-InsurTech-Report-2020-.pdf

[2] – https://www.axa.co.uk/articles/newsroom/2022/average-uk-home-contains-nearly-30k-of-possessions-but-many-people-risk-being-underinsured/

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