The insurance consumer has been undergoing a sophisticated shift because of a generational gap and rapidly advancing technology, according to a new report from Conning Research & Consulting, titled “Consumer Trends in Personal Lines Insurance,” which attempts to unravel those shifts.
As the middle class is grows older, along with it the median age, the youth segment is rising: “For auto insurers, these represent growing populations of drivers in what are the two worst age cohorts for claims activity”—the youngest and the oldest.
Conning points out that technological advances serve to accent the growing youth segment and require business adaptations. These adaptations bring improved customer service from insurers largely through meeting the increasing desire for constant connectivity. Meanwhile, an increasing tolerance for personal transparency—whether that is the storage of private information, the sharing of personal information via social media or the constant monitoring of driving behavior—rewards insurers willing to reach out and experiment with various technologies with invaluable information.
“With the evolving consumer willingness to surrender private information in exchange for a benefit, consumers appear to be increasingly comfortable with the usage-based insurance/pay-as-you-drive concept,” the report says. “On-board monitoring opens up the ultimate in insurance pricing information—moving from proxy data to actual driving risk data.”
The report concludes that the demand for increasing connectivity and increasing accuracy will continue to dictate the direction of technology for the next several years while the economy and aging baby boomers will remain the industry’s x-factors.
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