What the C-suite needs to know about the Internet of Things for insurance
CEOs and CIOs at insurance companies are well aware of the need to drive enhanced customer intimacy, but many insurers are only just beginning to prepare. In fact, just 33 percent of insurers say they are collaborating extensively with their customers today. However, 90 percent of insurance CEOs plan to focus on getting close to customers in the next five years.
Insurers are exploring how to adopt new business models that can drive customer satisfaction and customer lifetime value. The Internet of Things for insurance is one key area that can deliver results. Insurance companies are working with technology providers to implement solutions based on the effective usage of Internet of Things data, mobility and insurance analytics.
Advantages for the insurance industry
The Internet of Things offers four distinct benefits for insurers who are looking to transform data into tangible, revenue-driving business value:
- Pervasive connectivity: By bringing together the digital lives of automobile drivers and homeowners, insurers can provide a seamless, connected experience. And then they can leverage that data to provide value-added services such as location-based, cross-sell and up-sell offers.
- Insight and interaction: Insurers can also obtain unprecedented insurance business intelligence that allows them to interact with policyholders more frequently and with more personalized information than ever for enhanced customer retention and customer experience.
- Advanced value propositions: One of the most exciting opportunities for the Internet of Things in insurance is the ability to create new business models and revenue streams. Insurers have the ability to offer new value propositions that monetize data, adopt connectivity and optimize existing business processes.
- Industry transformation: The connected car transforms the vehicle from a reliable transportation platform to a mobile commerce platform. Usage-based insurance is transforming insurance coverage from a transaction-and-reaction focus to a prediction-and-prevention focus. Insurers can provide their policyholders with feedback about their driving, reward safe driving behavior and provide tips for policyholders who are not following safe driving practices. These actions can lead to safer roads and highly strategic policy pricing. In addition, the Internet of Things is providing enhanced claims efficiency. By combining telematics data with customer and policy information at the scene of an accident, for example, insurers can initiate claims processes early.
Rich resources for the insurance industry
IBM understands that data from policyholders can provide the insight necessary to optimize existing marketing efforts and create new streams of revenue. The IBM Analytics for Insurance website provides more information about the exciting opportunities for insurance and other industry-specific solutions, including resources under Increase Flexibility and Streamline Operations. IBM also offers customized workshops for businesses interested in learning how their specific pain points can be addressed with analytics solutions. Sign up for a complimentary workshop today. In addition, insurers have the opportunity to sign up and, with fellow business professionals, attend a live demonstration of IBM Behavior Based Customer Insight for Insurance.