Kim Tyler discusses the moment when insurance began working for the people

We live in an ‘on demand’ economy with goods and services designed to arrive at lightning speed for virtually all of life’s moments. That moment you need a taxi? An Uber is only two minutes away. Hungry right now? Myriad delivery services will bring your favourite meal to your door in under an hour. Need to pay an overdue bill? Do it through your bank’s smartphone app on your commute.

And as we want more and more things, we’re getting used to having our way. This desire for instant gratification is even hardwired into our psyche: psychologists call it ‘future discounting.’ We simply value things that gratify us in the short term over those that deliver value in the long term (ask any smoker or after-work drinker if you don’t believe us).

So what does this mean for a product such as insurance that has an intangible and indefinite benefit?

For years, the insurance market relied on complex products sold by instilling a sense of fear about the future. Couple this with low consumer engagement rates and a traditionally slow rate of innovation, and you have a product category ripe for disruption.

In a world that’s truly on-demand and changing by the second, and where people live in the moment (rather than in the future), insurance brands in particular must adapt more rapidly than ever to stay relevant. Doom and gloom stories are the traditional marketing tactic to sell insurance plans because they’re designed to elicit the emotional response of fear.

But fear-led purchases don’t always foster brand loyalty. Insurers need to go beyond using fear and think about how to build deeper emotional relationships with their customers.

Fear can be resolved emotionally in a number of ways and insurers should consider how to tap into the right emotion in their communications.

So how can such a daunting product become less fearful and more relevant to customers’ daily lives, while being useful and even aspirational?

FOCUS ON TODAY Insurance brands are beginning to find moments that help customers today rather than protect them against future misfortune. Manulife Hong Kong flipped traditional insurance selling on its head to appeal to younger people by helping them live healthier lifestyles.

Providing a wearable device to encourage people to move more and be more active, Manulife is offering rewards that revolve around those with the most active lifestyles. It has driven growth in customer loyalty by taking an active interest in improving its customers’ wellbeing and reaching out to a younger audience that is typically not too concerned with insurance products.

Manulife Move playfully promotes fitness benefits in a youthful and lively campaign, which brings to life the benefits of being fit and healthy today rather than tomorrow. Today, as tech devices begin to seamlessly integrate into daily tasks, insurance brands have a unique opportunity to use in-the-moment data to predict and even prevent future life scenarios.

Providing customers with a fitness tracker offers an insurer valuable data to offer lower premiums to people who are active. This motivates customers to remain healthy and also means less payouts for the insurer in the long run – a win-win scenario.

BE ‘ON DEMAND’ Advancements in technology are creating a plethora of new product opportunities. Leading the market with on-demand products could provide the competitive edge that comes with offering people the option to make convenient in-the-moment purchases.

Those already leading the way include Cuvva, which discovered a moment that was underserved in the insurance market. It’s for when you need to borrow a friend’s car for an hour and his insurance plan doesn’t cover you; or when you own a car but need it only for surfing trips on weekends.

Cuvva offers flexible motor insurance products in a market that traditionally operates under strict annual policies. It recognised a potential moment of tension in the journey when customers have to call the insurer to amend their policies. Cuvva addressed this by developing an app that enables its clients to emend the policy instantly.

The moment of researching and buying insurance for your life, car or house can be loaded with tension. Brolly is a new ‘personal insurance concierge’ designed to cater to the complex and arduous process of purchasing or renewing an insurance policy. Powered by artificial intelligence (AI), Brolly is built to meet customers’ varying insurance needs and help simplify them at the moment of purchase to provide a hassle-free experience.

BRAND IN ACTION Insurance companies exist for those superhero moments, don’t they? When life takes a turn for the worse, an insurance plan’s purpose to save the day is realised and helps dissolve a stressful emergency.

But people tend to avoid thinking about the worst-case scenario or do not consider that the worst could happen to them. This means that insurance brands are not often top-of-mind for customers unless they need to make a claim.

To reinvigorate customer loyalty and retain market share, Direct Line focusses on the moment when something does go wrong. It produces an imaginative video series starring Pulp Fiction’s Harvey Keitel positioning the brand as a heroic ‘fixer’ of life’s emergencies.  Direct Line even incorporated a twitter campaign with real life ‘fixers’ to find and help people in emergencies.

Showing off the benefits using case-by-case scenarios meant that it could also highlight specific elements of products that need cover and feature them working in action. In choosing to ‘hook’ customers by arousing their imagination with real life scenarios – rather than only the usual price and cover differentiation – Direct Line connected with customers on an emotional level and increased its share of a fiercely competitive market.

LIVE IN THE MOMENT New technology and fast-paced lifestyles mean we need easier ways for insurance to help us prepare for, predict and prevent life’s uncertainties. Though these uncertainties historically activate the benefits of an insurance product, the changing market means insurers are now uniquely positioned to create new products that find and connect with customers’ daily lives.

Connecting consumers with the long and short-term benefits of an insurance product, and expanding services so that they’re relevant and visceral (relating to the ‘now’ moment) will help increase brand visibility, trust and loyalty, as well as retain customers over the long run.

Kim Tyler is an Associate Director – Financial Services and Technology of Kantar TNS UK