Google are apparently seen by an increasing number of insurance product providers as the greatest threat to their market dominance than even their closest industry competitors, as existing companies see tech-savvy upcoming generations (and potentially the next wave of policyholders) swayed more by a virtual approach to policy promotion and provision. That’s according to a recent report which has researched proof that some 40% of current insurers view the search engine and self-driving vehicle-pioneering behemoth as the most significant stumbling block between their fully paid-up present members and their continued monopoly-of-sorts on what detractors might call a pretty archaic institution ripe for a wholesale shake-up.
Citing the omnipresence of the brand and its consumer data-browsing assets as posing the biggest threat to the insurance industry’s status quo, a recently compiled annual world insurance report by consultancy, Capgemini will heighten fears that what’s seen as a new ‘young, mobile phone-friendly’ consumer army will instinctively side-step the traditional insurers in the near future, instead opting to arrange their insurance policies with more ‘nimble’ competitors, geared up to appeal to the next generation on an ever-increasing number of levels. Outperforming the likes of Amazon and Wal Mart en route to being outed as the biggest new threat in the insurance arena, the conclusion was reached in the aftermath of pooling the thoughts of 150 insurance execs.
Insurance Industry Advised to up its Games to Fend off Interests from Tech Giants to calm any (as Yet Unfounded) Policy Shifting Nerves
The most prominent sign that the industry is bracing itself for something of a sea-change in the foreseeable comes in the shape of telematics-based motor insurance according to many experts, with black box policies gathering an impressive following in a relatively short space of time. What’s more, connected home tech set-ups is forecast to impact the home contents insurance field before long, which to the uninitiated is the provision of technology which effectively enables the user to turn off an oven from a distance if it has been left on, for example, potentially avoiding a fire. Insurance executives predict such remote issues are destined to impact the household insurance market before long, and are quick to point out that Google already owns connected home products maker, Nest; which could act as a springboard to providing insurance. As it stands insurers are finally beginning to look over their shoulders and embrace the technology that’s widely available to gleam more would-be policyholder data with the aim of offering them lower-cost policy premiums, which is a cue that many more need to be taking according to the author of the report. Capgemini said; “To withstand the coming competition, insurers must build up their brands, learn to take advantage of real-time customer data, and develop agile operating models.”
Nigel Walsh is the Head of UK Insurance at Capgemini and believes that it’s only a matter of time before Google establishes a footing in the insurance sector, yet stops short of suggesting that the tech giant will become an insurance underwriter as some fear. That said, Walsh told Yahoo that by getting Nest on board, the scene is set to change, adding; “They are a massive part of the insurance value chain, because of what they know about consumers.” Not all insurers are convinced of the threat posed by Google though, with a percentage doubting that technology companies will enter the heavily-regulated insurance sector directly, conversely thinking the greater likelihood is for them to pledge allegiances with insurers as opposed to going it alone. One thing is for sure though, and as Yahoo underlined; that being the industry requires an overhaul of sorts if it’s serious about keeping its head above water as tech firms like Google become more involved at whatever level, and moreover to appeal to younger customers. Separate studies carried out by Cargemini (whereby it polled 15,000 customers across 30 countries worldwide)have found that just 34% of customers under 35-years reported positive experiences with their insurers, compared with a more convincing 55% amongst the over 35s demographic.