After 9/11, a disruptive revolution in air travel occurred. The airline's security was tightened far beyond what we had previously known. In addition to new review guidelines, travelers were exposed to more frequent individual viewings. More things need to be removed from our bags and examined. Electronics must be turned on. Our shoes started to come loose. TSA needed to know us personally before we could fly.
This, of course, created lines. We had to get up earlier to get to the airport to report two hours in security. Shorter flights were no longer worth it. "I can drive there in less time."
So in 2019, the TSA began to do everything to improve the route situation and used CT scans at many busy airports. CT scans would change 2D baggage scans to 3D scans, allowing the operator to look at an object in more detail without noticing a bag to be opened and checked by hand. Their ability to "see" the hidden information would shorten the lines and streamline the travel experience.
When COVID hit, lines evaporated. The flight hit rock bottom. Lines are usually not a problem right now, but public safety is now an even bigger issue. In China, for example, large scanners are used to check human temperatures on everyone who travels. Those with high scans are tagged and removed for further screening as it would not be practical to scan all passengers and crew on board a plane individually.
This concept is carefully considered for all insurers, and especially for life insurance companies. In what ways can we use the technology to know applicants and policyholders directly and use that information to protect them and our level of risk in the process? Can we build flexible frameworks for accelerated and floating insurance that enable us to address new issues as they arise and take advantage of new data as they become available? Life insurance companies, group providers and voluntary benefits are entering new regions of opportunity through new doors for data capability.
In Majesco's latest thought-leadership report, Rethinking Life Insurance: From a Transaction to a Life, Health, Wealth and Wellness Customer Experience we examine the nature of the purchasing experience. Our latest survey of all age groups segmented into two groups ̵
Every experience contains data.
Today, almost all aspects of B2B, B2B2C and B2C customer experience have a level of intelligence that has created a wealth of data on customer activity, behavior and preferences . From smart speakers to smart watches, telephones, devices, sockets and more – sensors and signals are everywhere. And with customer status, they measure almost every aspect of their lives. The result is that we now have data to capture the instantaneous 3D view instead of the 2D view. But insurers must strategically invest in ways to capture and master this data to change customer experiences in an age of immediate digital engagement, delivery and satisfaction.
The use of data for life insurance is crucial. Interestingly, the insurance industry has captured behavioral insights from customer interactions – offline – for many decades, before technology simplified the management of customer relationships. Unfortunately, companies did not know how to optimize their use of data before now. It must change if insurers are to survive.
Can data enhance the experience?
To meet the needs and expectations of today's customers, insurers must create a radically different insurance experience, ranging from a reactive to a proactive method with real-time data, artificial intelligence (AI), machine learning (ML) and behavioral science to make processes and transactions simple, convenient, transparent and fast like other companies. Encouraging, our research found that the younger generation is ready and willing to use and share most new data sources to buy and rate life insurance policies. This willingness will be a key to unlock sales at life events.
Addition to this market opportunity, Majesco's survey data showed that even the Gen Z / Millennials who do not currently have life insurance are open to using the new data sources, almost the same as their peers who have life insurance.
Insurers who do not actively plan and build capacity to use new data sources will quickly be left behind.
The MIB's activity report from February 2020 highlighted that demand for food policy has pandemically driven application activity to its highest level since 2015. As previously mentioned, "floating" life insurance online has increased dramatically in the first three months of 2020. [i]  To bring about this great transformation of experience and bring the decision and the purchase at the same moment, the insurers go from an insurance-centric view of a digital, data-driven, accelerated and sometimes fluid insurance process. Accelerated guarantee is becoming increasingly common for forward insurance. As shown in Figure 1, interest in products that use dynamic subscription and pricing is more than twice as high in the younger generations – a significant difference that many insurance companies cannot meet today. Again, our data showed that the younger generations who do NOT currently have life insurance are even more interested in this option than their peers who have life insurance (41% vs. 35%). Market and growth opportunities await those who accelerate the transition to dynamic drawing and pricing with new data sources.
Figure 1: The interest in products that use dynamic drawing and pricing
With the right use of data, we do not stop people at the checkout counter.
In the traditional guarantee model, we ask people to come to the checkout for a price check and then send them home until we verify their ability to buy by collecting lots of medical and personal information. Companies are amazed at their level of not taken policies. But if you put yourself in the customer's shoes, why do you want to go through extra hassle and time, especially when other options come up? With this picture, we can correctly assume that accelerated guarantee is a modern bargaining power that suits the desire for immediate satisfaction when needed.
Initially, some insurers are reducing current medical reports (APS) and paramedical examinations (providing body fluids) and using more third-party data and predictive analytics-based models to automate and improve the insurance process. [ii]
Others take in behavioral data from fitness and health programs, social media data and new data sources with AI and machine learning algorithms to create "smart, automated guarantee" that is continuously learned and adapted. All this redefines the process and cycle time and creates a completely different customer experience.
The right ingredients in the right place at the time.
Here technology works as an enabler. In order for life insurers to be able to adapt their products to lifestyles and experiences instead of traditional transactions, several components must be in place.
Cloud use for digital enabling: The point of sale (and marketing) must be well-integrated into current life processes. Often this means partnership or channel expansion that requires digital integration with APIs and a cloud-based environment.
Data Integration (and AI / ML) for Accelerated and Floating Warranty: Insurers need to create ways to go fluid-free and doctor-free so that they can automate decisions in real time.
Ecosystem philosophy: Insurers must increase rapidly. They can do this by collaborating with ecosystem developers, such as Majesco, who can give them access to the data sources, channels and technology opportunities that will contribute to rapid transformation.
Innovate for the Future: Innovate. Recreate. Reach. To learn from the past, that good data is not necessarily used effectively, insurers must place themselves on a course for optimal data use across the company. They need to renew how they use data to get a 3D image for accelerated warranty. They need to replicate greenfield and startup methods that transform data availability into enhanced experiences. And they must reach growing and untapped markets with products that sell in the life experience, instead of relying on traditional sales tactics.
The industry status quo is no longer an option. Your customers, especially the younger generation who will be your dominant buyers, expect all this and more. They want a customer relationship with a broader value to make their lives better over life, health, wealth and lifestyle needs.
How do your strategies adapt to what customers want? What plans do you take to improve your chances of success?
Your answers will determine your readiness for a new decade and the future of life insurance focused on making customers' lives better over life, health, wealth and well-being … and whether you will enter a new boom era of life insurance .
Are you ready? Your customers are.
For more information on how to end transaction thinking and start benefiting from customers' life experiences, be sure to download, Rethink Life Insurance: From a Transaction to a Life, Health, Prosperity and Wellness Customer Experience .
[i] "US Life Insurance Activity Remains Positive in June Reports MIB Life Index," MIB Group, July 13, 2020, https://www.mibgroup.com/riskanalytics/life_index_pr.html  [ii] "Milliman Survey Reveals 25 of 28 Companies uses or plans to use accelerated life insurance coverage, ”Press Release February 13, 2020, https://www.prnewswire.com/news-releases/milliman-survey-reveals-25-out-of-28 -company-uses-or- plans-to-use-accelerated-insurance-in-life-insurance-301004661.html