Can the full insurance experience move onto mobile?
Insurance has always been a sector benefiting from the human touch. However, mobile phone penetration is higher than ever and the insurance sector has to take advantage of that. How can insurance utilise the mobile experience? Claire Read writes
Andrew Leal knows that, for clarity’s sake, he’s obliged to say that his company is in the insurance business. But it’s not a description he feels adequately sums up the aims of Waggel, the digital startup of which he is chief executive and co-founder.
Launched to the public last December, Waggel offers entirely paperfree pet insurance. Yet with associated benefits for policyholders – including discounts on pet food and the offer of consultations with pet nutritionists – Leal says the ultimate desire is to build a wellbeing community of which individuals are keen to be a part.
It’s an aim he feels has been made possible by the march of consumer technology. To visit the company’s website is to be greeted with a bright colour scheme, friendly language and a lot of fetching animal-related images. It’s also to encounter a site which has been designed with smartphones foremost in mind.
“We spend a great deal of time and effort making sure that every part of the journey has been thought about, and there are no buttons or anything that is cluttering the screen,” explains Leal. “The whole idea is to make it extremely intuitive. We made it very simple for someone to get through the quote process.”
This is insurance conceived as an Uber or Deliveroo-like service: intuitive, related to your friends (canine or human), and quickly accessible from the phone that is constantly at your side. And Leal is far from the only one advocating such a model, and the UK far from the only country in which it’s relevant.
Mobile leading to inclusion?
MicroEnsure’s millions of customers, for instance, live in emerging countries in Africa in Asia. For the vast majority, it is the first time they have held an insurance policy – and mobile phones have been central to encouraging that development.
“Unlike in the UK or EU – where insurance companies are trying to work out how to make their product more interesting than the competition – I'm competing with: I don't have insurance, and I don't know anyone who has insurance,” explains Richard Leftley, the company’s founder and chief executive.
He says that means a customer attitude of “if you make it tricky for me in any way then I would rather than revert to my default position which is I don't have insurance and I don't need it”.
Countering that attitude has involved embracing digital communication methods and forging connections with large telco providers. Free insurance from MicroEnsure has become a perk of being with the Tigo mobile network, and one that is brought to customers’ attention by means including text message.
"There has be complexity in these products, but that has to be hidden from the customer in order that it's very simple and frictionless,” explains Leftley.
“A lot of the IP for us is around the customer journey. So how do people sign up, how do people engage with the product, how do they make a claim, and making those things work really, really smoothly is a big part of our secret sauce.”
On the face of it, the customers of Cuvva are very different from those courted by MicroEnsure. And yet the companies’ philosophies and approaches have much in common. Founded in 2014, Cuvva enables customers to take out car insurance policies over flexible time periods – as little as an hour so that, for instance, you can quickly borrow your mate’s wheels knowing you’re covered.
All sales are via an app, an intention that was present right from the company’s inception. Explains Loren Gould, head of growth: ”Our policies start instantly: when you're ready to drive, that's when you buy it.
“If you're going to buy an hour's worth of car insurance, it doesn't make sense to do that online [from a computer]. Because by the time you've closed down your computer and got out of the house, you've maybe wasted 15 minutes of the policy time.”
“Within insurance, there are a lot preconceptions; a lot of: ‘No [you can’t do that], because it’s always been done this way’. It’s pretty antiquated.”
It’s a pretty radical departure from traditional car insurance models and finding an underwriter willing to support such a setup was, he admits, a challenge. “Within insurance, there are a lot preconceptions; a lot of: ‘No [you can’t do that], because it’s always been done this way’. It’s pretty antiquated.”
He continues: “For the first year, it was essentially a process of speaking to c-suite people at underwriters, and every time they would highlight a problem going back and fixing that problem until eventually it was very difficult for them to say no.”
Gould suggests this lack of flexibility is preventing large insurers from effectively embracing the march of mobile. “On a technical level, the incumbents are just tied down with all this legacy code, and it’s very difficult for them to get technical expertise in house. And then on the of that, you have this level of bureaucracy.
“So change for them is slow. I think that’s good for an upstart like us, because it means we can try to help push things forward more quickly.”
Over at Waggel, it’s notable that not one member of the team has an insurance background – and it’s something which Leal sees as something of an advantage. “We actually use that, dare I say it, ignorance as a strength. It means we don't have any preconceived notions of how things should be done. And that has certainly helped us build stuff that people have been like: 'Huh! We didn't know you could do it that way’.”