Creating digital customer-centric strategies Chris Halliday HAL… · Using Technology and Big Data Analytics to improve customer outcomes Data and Digital Strategy: Enabling innovation

February 2017

International Motor Insurance Conference

© 2016 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Creating digital customer-centric strategiesChris Halliday

Digitisation and customer is at the Heart of Companies’ Strategies…

© 2016 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only. 2

“UNIQA launches €500 million investment programme –

digital transformation in the core business” press release, 10.03.2016

“Digitalization is one of our key strategic topics

and affects all areas of Allianz”

Sustainability Report 2014

“Data and digital central to Zurich’s success in coming years”

press release, 21.05.2015

“Our aim is to become a leading European retail insurer by

taking advantage of this digital transformation and by

changing the company mind-set to a customer-centric one”

Annual integrated report and Consolidated financial statements 2015

But how well has the Insurance Industry done to date?


Is this Insurance Industry ripe for the taking ?

But how well has the Insurance Industry done to date?


Is this Insurance Industry ripe for the taking ?


Drivers of digitalization in insurance

Cus

tom

er c

entri

city

Dat

a in

tegr

atio

n

predicting and responding to customers changing needs

Improving and optimising distribution and customer service

Improved efficiency and expense management

reacting to and influencingcustomer behaviour

omni-channelcustomer connectivity and consistency of message

costs / expense ratioautomation

de-duplication of tasks

Why be digital ?

What is your digital ambition?

Linking to your strategic business priorities


Ambition Principles Innovation Projects

IT Infrastructure

Data and Digital Strategy

Strategic Business Priorities

Innovation is taking placeTrov – on-demand insurance for your things


1. Collect details about your things and protect just what’s important to you

2. Turn protection on or off, file a claim in the app – complete mobile experience

As of May 206, 940K items added, over 8.5Bn worth of items

Source: Trov

Health Insurance leading the way


§ Goal is to have the happiest members paying the lowest costs for the healthiest outcomes

§ 145K customers in 2016 with plan to reach 1Mn customers

§ Making data-driven decisions based on large data sets aggregated across providers and care data

“Make health insurance suck less”




IT Infrastructure



Innovation Projects: The Art of the Possible


Automatic claims

settlement using

Underwriting data

Real time millisecond

individualised pricing

Integrated sensor input: Telematics /

IoT / Wearable

Real time customer value

metrics

Single customer view

Real time underwriter

decision support

Customer focused portals across multiple

channels


Innovation Projects: Telematics

l Maintenance and fault diagnosis via customer portal

Vehicle wellness

15-30%Average discounts:

12% – 25%Maximum discounts:

30% – 50%

Self-selection10x

Differential in loss ratio from TW DriveAbility score

Pricing

Retention

40%Improvement in retention

cited by Progressive http://media.corporate-

ir.net/media_files/IROL/81/81824/clip-415391-dl_aud-en.mp3

30+%Reduction in claims costs

Behaviour change

APP

Fraud

Fraud Bureau

Insurers Exchange

Investigators

Fraud Register

External Mining

Supplier alerts

Innovation Projects: Harvesting the widely dispersed claims data


Suppliers

InterventionReplacement

car

Windscreen

Legal Panel

Other suppliers

Roadside recovery

Repairers

Engineers

Repair Database

Email

Post Phone

Social media

Email

Post Phone

Portal

Personal Injury

Injury valuation

tool

Portal

Core systems

Commercial Motor

Personal Lines Motor

UW and claims

Document management

system

Phone

Email

Motor Claims Example

App

Innovation Projects: Becoming Truly Customer Centric Organisations


Analysis Point of Sale

Forecast available for each individual customer / prospect:§ Expected profitability / Lifetime value§ Expected retention§ Expected conversion§ Maximum discount for individual customer

still delivering minimum of profit

Digitisation tears down the wall and enables free flow of information – in both directions




IT Infrastructure



Where are companies now….different stages, but common themes


Issues with legacy

systems

Poor data quality

Concerns about the implications

‘Pet’ projects that are fragmented across the internal

organisation

Culture that does not

value data Analytics arms race

Data ‘storm’ with the potential for multiple new data sources

Principles: Changing customer expectations


Change the view: From product / LoB to customer

Ensure permeability between channels: One version of the truth for a client, integrated intermediary portals

Proper multi-disciplinary teams / strong analytics function / Break-up of silos Alignment of strategy and ambition across all functions

Gain a deep understanding of risks, client and distributor behaviourIncreased frequency and breadth of modelling - continuous refinement of customer knowledge

Handle large amounts of data efficientlyIntegrate large amounts of internal and external data, to allow relevant products and customer interactions

Management of internal data and technology solutions

© 2016 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Using Technology and Big Data Analytics to improve customer outcomesData and Digital Strategy: Enabling innovation

Willis Towers Watson Pricing Software Supporting Effective Pricing

EmblemPredictive modelling software

ClassifierGeographical spatial analysis

Innovation Projects: Best Practice Pricing and Underwriting

Radar BaseBuilds and views analyses and reports

Radar DashboardViews reports and interactive dashboards constructed with Radar Base

Radar LiveExecutes calculations and rules at point of sale

Provides the interface, forms and workflow integration

Creating digital customer-centric strategies Chris Halliday HAL… · Using Technology and Big Data Analytics to improve customer outcomes Data and Digital Strategy: Enabling innovation

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