Innovation in Insurance: A UK Consumer View

For most insurance companies, innovation in service technology is necessary in order to deliver consumers’ service requirements. In the UK, online service via the home computer (81% extensive or occasional use) and phone-based call centres (63% extensive or occasional use) are an established part of the customer service landscape. However, is this what consumers expect to continue using in the future? What are their expectations of innovation in customer service? Which innovations will carry the most value for insurers?

In the report Innovation in Insurance: A UK Consumer View, Celent provides insights on what technologies UK consumers are using today for customer service, what their expectations are for innovation in customer service, and their preferences when selecting a financial services provider. This report draws on the findings of a survey of 306 consumers from the United Kingdom.

Key findings explored in the report include:

• UK consumers continue to use a wide variety of technology options in their service interactions. However, UK consumers still heavily rely on the home computer (81%) and the telephone landline (63%) for either extensive or occasional use. Mobile access for customer service (39%) has yet to fully take off.

• Wealthy households with an income above £100,000 per annum show an increased propensity to use online self-service channels (48% average across simple and complex transactions) over “face-to-face” transactions (19% average across simple and complex transactions). Households with an income less than £100,000 prefer to use “face-to-face” for complex transactions (39%) and online self-service for simple transactions (48%).

• UK consumers prefer service methods that offer maximum ease of use (26%), personalisation that includes a “human touch” (22%), and convenience (15%).
  
  

The survey also provides insights concerning the factors that drive a consumer’s choice of financial services provider. Price and product lead the selection criteria, with innovation in product and service ranking as a high determinant. Survey results demonstrate that a reputation of innovation influences consumer choice in financial services.

“These survey results provide a fascinating look into how consumers engage with insurers today and where their preferences lie for future engagement,” says Jamie Macgregor, Senior Analyst with Celent’s Insurance Group and coauthor of the report. “One of the biggest surprises was the continued importance consumers placed on human interaction and how this changes with wealth. The results appear to indicate that the wealthier you are, the more comfortable you are with self-service and, conversely, the less wealthy you are, the more help you require when it comes to complexity. This reinforces the need for a deeper understanding about what customers’ really value when servicing their products as part of proposition development.”

This report supports and challenges commonly held assumptions about customer experience requirements. It examines results from the survey around current technology usage for servicing financial products, consumer preferences, and attitudes towards innovation. Finally, a high-level recommendation for potential next steps is provided for both insurers and technology firms working with them.

This 26-page report contains 14 figures and 4 tables.