INFORMATION EXCHANGE
THE RIGHT DATA AT THE RIGHT TIME FOR CUSTOMERS
Making the right call for customers starts with the right data at the right time. As the UK emerges out of lockdown, insurance providers will not only need to consider the change in mind-set that the experiences of the past year may have created amongst their personal lines and business customers, they also need to prepare for changes to pricing practices. These factors are heightening the demand for reliable and accurate data at speed, at point of quote, renewal and mid-term adjustment in order to make the most informed pricing decisions. The market is highly conscious of the financial stresses on individuals and businesses created by the pandemic and how this may play out in the way customers shop for insurance. Some may choose to strip back their cover to what they see as the ‘bare essentials’ raising the risk of underinsurance. Others may be tempted to manipulate the data provided in the application to try to secure a cheaper quote. Our own study prior to the pandemic found the manipulation temptation to be true for two out
of three of the home owners and renters we surveyedi. In a similar study conducted amongst motor insurance buyersii, 40% said they thought it was acceptable to use the same no claims discount/ bonus on multiple vehicles. And, 17% thought it was fine to change information regarding their occupation or age on a car insurance application to lower the cost of the premium (35% of 18-34s were most likely to try this tactic). Of course the biggest risk is that the customer comes to the decision that they don’t need or won’t pay for insurance – regardless of whether it’s mandatory or not. Insurance providers cannot risk falling at the first hurdle by delivering a slow, complicated application process with pricing that is out of step with the individual risk profile of the customer today. Instead, the focus must be on delivering a swift service that responds to each individual’s needs and how that might have changed as a direct outcome of the pandemic, while at the same time taking steps to protect themselves from fraud and increased claims losses which can only add to the cost of insurance.
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