Client expectations are changing rapidly as technology evolves, and that’s forcing the life insurance industry to embrace new technologies and distribution channels, according to experts who spoke at the KPMG Insurance Conference in Toronto on Tuesday.
Despite that technological shift, Canadians continue to value their relationships with advisors considerably more than consumers in other countries, the presenters said.
“The [insurance] broker, very interestingly, despite the aging broker population, is still very important in the sale and service of insurance products,” said Nazir Valani, partner and national leader, actuarial practice, with KPMG.
Even though Canadians are increasingly embracing mobile banking, online shopping and other digital transactions, they continue to depend on face-to-face advice when buying insurance. That’s not the case in many other countries, said Jeremy Anderson, chairman, global financial services, with KPMG.
“What intrigues me, when I look at Canada, is just how much importance the average person seems to put on the broker community as intermediaries,” he said. “That’s different from the rest of the world.”
This means that although it’s important for insurers to innovate and embrace technologies that can improve the customer experience, they must not neglect the face-to-face relationships that Canadians value.
“If we’re going to be relevant to our customers and get that growth, then not only have we got to get the product and the service right, but we’ve also got to make sure that we are actually treating them in the way that they want to be treated,” Anderson said.
Rather than focusing on one distribution channel, he said, insurers need to offer a variety of different channels and enable clients to interact through the method they prefer.
“If we’re going to be customer-centric, we have to have an omni-channel model, because different people want different things,” Anderson said.
The speakers highlighted some of the results of KPMG’s recent CEO Outlook Survey, which reveals that technological innovation is top of mind for insurance industry executives. Specifically, the survey showed that the top three priorities for insurance CEOs are fostering innovation, becoming more data driven and implementing disruptive technology.
Of more than 100 insurance CEOs who were surveyed, 69% said they plan to invest into digital infrastructure over the next three years. In addition, 81% of CEOs said they believe they are actively disrupting the sector and 61% said they see technological disruption as an opportunity rather than a threat.
That focus on innovation is important in order for the insurance industry to adapt to evolving customer preferences, the speakers said.
“Customer expectations are changing fast,” said Anderson, “and technology is making a significant difference as we move into an omni-channel and digital world.”
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