Less than one-fifth of top life insurance carriers have a policyholder smartphone app, according to the "Mobile Apps in Life Insurance: An Underutilized Channel" report from Aite Group. The research firm surveyed consumers and carriers alike to get a picture of the industry's mobile prowess, and discovered that mobile apps are an underutilized tool by life insurance carriers, as many have yet to consider the potential they can bring the overall customer experience. Even if insurers offer mobile apps, customers tend to have trouble locating them. Survey author Samantha Chow offers five tips for companies looking to improve on their mobile strategy.
A mobile app opens the door to two-way communication. Most important is the ability for the life insurance carrier to push information to the consumer via mobile app alerts, text messages, and emails, Aite Group says.
"Communication through a mobile app can be personalized. It can be triggered by events, activities, social behaviors, driving behaviors, shopping behaviors, and much more. The future of communication is the ability to track and utilize this information to personalize and meet the needs of consumers before they realize a need exists."
Life insurers still struggle with what the best methods of engagement are. The answer doesn’t only have to be wearables or Internet of Things device programs. With a mobile app, carriers can stay top of mind for consumers through birthday notifications, polling questions to support product development and reminders to check/update personal information.
“By nature, life insurance is a low-touch product, but having the ability to positively engage with consumers helps to keep the loyalty and brand recognition high," the report says.
The PhonePe mobile app, on a smartphone, and a point of sale device are demonstrated during a product unveiling in Bengaluru, India, on Tuesday, Oct. 31, 2017. Phone Pe is the digital payments unit of Flipkart Online Services Pvt, India's biggest online retailer. Photographer: Samyukta Lakshmi/Bloomberg
Payment and lapse
Life insurance carriers spend much of the first half of their fiscal year making up for policy losses—due to cancellation, lapse in payment, or death. Many of these lapses occur after unexpected increases in premiums. Additionally, insurers can reach out to customers about overdue premiums, Aite Group notes, with minimal effort from the company.
“By preparing consumers in advance via mobile app [push notifications,] carriers can ensure a higher read rate. Being able to communicate in this fashion also gives the policyholder an opportunity to reach out directly and easily to the carrier by chatting either via text or via click to call.”
An employee takes a call at a call center servicing Xiaomi Corp. in Bengaluru, India, on Friday, March 31, 2017. Once compared with Apple Inc. for its sleek smartphones and charismatic leadership, Chinese startup Xiaomi is seeking an image makeover as it tries to recover from a sales-growth slide. Photographer: Dhiraj Singh/Bloomberg
Mobile policy management
Customers do not want to speak to representatives every time they need to update basic information, Aite Group says.
“Being able to easily log into the app and make address, beneficiary, or payment changes is integral to the benefit and value the mobile app provides. Not only does this provide a good customer experience, but it also cuts down on calls into the service centers, leaving call-center agents to handle more important calls from policyholders that could result in saved policies, upgrades, cross-sales, or new sales.”
Close up of a man using mobile smart phone
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While lower on the list of priorities, a mobile app can help educate policyholders on a continuous basis.
“Think of the young policyholder with his or her first term life policy. Being able to provide calculators and tools for the younger generations to self-educate can go a long way for upsell and cross-sell opportunities. “
The level of education that could be achieved goes beyond push notifications, Aite Group says. This includes: