Insurance being sold over the internet and other digital channels in Europe could rise to €25 billion by 2016, which will come as good news to performance marketers involved in the finance vertical.
Consultancy firm Accenture’s latest report surveying C-level executives at 78 insurers around Europe, discovered that the total value of property and casualty (P&C) and life insurance policies sold digitally in 2012 was €12 billion.
The research also revealed that in 2013 only 11% of the ‘total annual new business premium volume’ originated from digital channels, but by 2016 the same figure is expected to be 18%.
Purchasing insurance over the phone or from a brick and mortar retail outlet has been overtaken by digital, according to Piercarlo Gera, global managing director of Accenture distribution and marketing services.
"Consumers are becoming increasingly unwilling to buy a product or service that does not provide the same levels of convenience, simplicity and speed to which they have become accustomed from many other services they use every day,” Gera said.
Insurers will be helping the market’s growth with investment of their own, as 78% of companies are planning to increase their budget for technology and systems used to sell insurance digitally in the next five years. On average, they’ll spend €27 million as part of this digital transformation.
Investment in big data management capabilities is a priority for more than half (53%) of the surveyed companies in the next three years, whereas mobile technology is being factored into the strategy of just 36% of insurers.
Google’s Emergence a Worry
When asked about competition, 89% of respondents felt it would be a tougher market in the next three years. As for the reason for the increasingly saturated conditions, 64% put it down to non-insurance companies such as Google and Amazon making a move into the sector.
Jean-Francois Gasc, managing director of Accenture distribution and marketing services for insurance across Europe, Africa and Latin America, felt traditional insurance companies are handicapped compared to the internet’s newcomers.
"The threat posed by emerging competitors such as internet giants is real because user-experience improvement is part of these companies’ DNA, and this is a strategic weapon in gaining market share in the insurance distribution business," Gasc mused.
“To maximise value from digital, insurers will need to move from a product-centric culture to a customer-oriented mentality.”