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Insurers’ strategies for the Smartphone Society

Perhaps it was no surprise that OFCOM declared the UK a Smartphone Society a few weeks ago. 

Smartphones have become ubiquitous in the UK, which the report more than confirmed as a defining characteristic of how we live, work and play. Among the many fascinating insights was how the report revealed that the smartphone has overtaken the PC or laptop as the preferred way to access the Internet for UK consumers.

So what does this mean for my industry?

It seems the opportunities for financial services are good. Indeed, the report confirms how important smartphone usage is for engaging with financial brands with a substantial proportion of users saying they use their phone for online banks (44%). This, paired with how much people confirm they are “hooked” to their smartphone, makes a mobile strategy highly relevant to the industry.

Smartphones and their easy access to the web are already reshaping the industry. One insight that I enjoy repeating is how the RBS chief executive declared in 2014 that his bank’s busiest branch is a morning commuter train into Paddington because of heavy usage of its mobile banking app. How much must this be true of other banks and financial services businesses?

Insurers, of course, have a part to play in  the smartphone society. Indeed, insurance apps for advisers, brokers and customers aren’t rare. But, as for banking, the challenge is make these apps and services seamlessly integrated with core systems so the customer or broker gets a consistently high quality service experience. 

The challenge is customer expectation, which continues to soar. There is little to no tolerance for a mobile service that can’t match the standard set by Amazon, for example.  Consumers expect full access to whatever they need, wherever they are and whenever they need it. It’s becoming clear that this must be extended to financial services like insurance, whether it is buying a policy or making a claim.

So making insurance services fit for purpose in the smart phone society will require the industry to continue its progress against a set of obstacles, namely:

  1. Modernising core systems, as legacy core systems were simply not designed for the Internet age;
  2. Avoiding building mobile service silos that risk creating an unnecessary maintenance burden. Making even simple changes to a mobile service portal can be a significant project if said portals are not fully integrated with their supporting core systems because the same functionality must then be changed on multiple systems to keep it in sync; and
  3. Scarce technology skills to keep on top of fast-moving technology.

Luckily, the insurance industry is starting to recognise these challenges. Those organisations that have grasped the need to be customer-centric in a digital age will be well placed to adapt and survive in our exciting smartphone society.

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