Generating sales has come a long way in travel insurance, with companies taking advantage of new advanced technologies such as cloud computing, the internet of things (IoT), advanced analytics, artificial intelligence and many more emerging digital tools.
Digital advances can help engage with customers in different ways and build new insurance tools and services. Technology that helps ease of use and generates hassle-free experiences is looked on favourably by travellers, which can be the deciding factor when signing up with an insurance company.
Release the potential for insurers to maximise sales of travel policies
The travel insurance market is set to increase by US$9.88 billion between 2022 and 2026, according to the Global Travel Insurance Market report, boosted by increased tourism as the world emerges from the Covid lockdown. Allianz Partners conducted a 2021 survey on customer behaviour and changes in expectations. It revealed that the new emerging travel client is a digital native, comfortable with digital solutions. A flexible and seamless experience is expected, with technology increasing travel confidence.
There is an untapped market ripe for sales conversion, consisting in part of young Millennials who do not usually purchase travel insurance – this particular demographic showed a 15 per cent increase in intention to buy international travel insurance policies, according to Allianz.
Embedded travel insurance solutions
Insurance can be integrated efficiently into the travel booking process to better meet customer needs, but it has to be done correctly to ensure clients are informed about the product they are buying. Ryan Brubaker, Chief Information Officer and Executive Vice President of Operations for US-based insurance provider Seven Corners, pointed out some issues he thinks need addressing: “When I see travel insurance buying options integrated into booking websites, there’s almost no information for the buyer on their potential policies. Travel booking websites that ask you to simply check a box during the purchase process are not going to provide much information.”
Brubaker also reveals technical issues that his company has successfully navigated, related to users being overwhelmed by phone notifications. “At Seven Corners, we utilise a mobile app, but find that more operating systems are making it easier to disable push notifications sent by apps, or sometimes those notifications are disabled by default. We’re moving towards SMS text messaging instead, because people find that more effective and are more likely to receive the message.”
The travel insurance industry is moving to LMS, or a learning management system, to incorporate sales training into online platforms
Agents who are harnessing trending technologies will be ahead of the game, and effective training of salespeople is vital. “The travel insurance industry is moving to LMS, or a learning management system, to incorporate sales training into online platforms, including online quizzes or short videos, to transition to more of a gamification style of training. LMS continues to be the most effective and expected method of sales training,” Brubaker said.
Investment in artificial intelligence (AI) and risk analysis tools will be a solid investment for travel insurers navigating a post-pandemic market. As circumstances change and new data becomes available, AI risk modelling allows insurers to assess in real-time and adjust policy offerings accordingly.
“We’ve seen improvement via the utilisation of AI through our chatbot, Sven. It started as a basic bot, and we’ve enhanced him to be able to answer customer questions with a knowledge-based article, before being routed to a salesperson,” Brubaker explained. “Chatbots are a good way to improve the purchase process for customers, getting them connected with the sales representative who’s best for their specific needs.”
Combining the power of digital with bespoke insurance expertise
Augmented reality devices can facilitate active interaction with a traveller’s request about a specific service – and seal the deal in minutes. The technology blends the physical and digital by layering computer-generated images and text onto a user’s view of the real world. It is used in various ways within travel insurance, such as visual claims, damage estimates, digital payments made directly to debit cards and explanation of insurance plans.
Robotic Process Automation (RPA) enables a fast response to customers. Potential policy buyers can interact and engage with an insurer via a remote sales session where legal documentation and contracts can be shared, and the necessary digital signatures collected.
Pattern Insurance offers customers real-time underwriting data for a frictionless buying process. The fully automated, embedded insurance-as-a-service platform empowers businesses to autonomously build and distribute unique and personalised products.
Robotic Process Automation (RPA) enables a fast response to customers
“Pattern’s embedded insurance creates endless opportunities for consumers, online businesses and insurers to seamlessly and effortlessly transact in real-time with complete alignment across multiple geographies,” said Assaf Wand, First Board Member of Pattern.
Joyce Segall, Head of Underwriting at Pattern Insurance, believes sales revenue can be improved by targeting and making offers more personalised, relatable and timely: “Using actionable intelligence to analyse existing data [means insurers can] offer additional relevant coverages. For someone on a camping holiday, it might be a weather guarantee, as no one wants to put up their tent in the rain.”
Segall also believes that push notifications ‘can be used effectively around a trip for weather, delay or cancellation information. They can offer additional coverage options in or after the purchase’.
Pandemic pushing digital solutions
Research conducted by Censuswide reported that more than a third of UK customers said Covid has made them interested in taking out a travel cancellation policy, representing a significant sales opportunity for insurers.
They are responding by providing Covid-specific policies to deal with the fast-changing situation. The collapse of airlines FlyBe, Air Italy and Atlas Global, to name a few, has created greater demand for scheduled airline failure insurance (SAFI). Policies offered by LV= General Insurance are protecting customers from flight cancellations when their airline goes into liquidation before the original travel date.
Some insurers are partnering with healthcare solutions like AirDoctor, while customers are taking out instant medical expenses cover from insurtechs like battleface. Another potential sales market is the customer making spontaneous or ad-hoc trips, with technology making the process immediate, easy to use and fast-moving.
The real-time speed of technology can also alert users and insurers in seconds when natural disasters happen
As conditions of travel can still change at lightning-fast speeds, insurers need to be agile and flexible to speedily calculate risk, using accurate, current data. This is especially true of terrorist attacks, which is further boosting demand for travel insurance, according to the Global Travel Insurance Market Report 2020-2026.
The real-time speed of technology can also alert users and insurers in seconds when natural disasters happen – such as sudden floods, earthquakes and storms. A SkyQuest analysis on the travel insurance market in 2020 found that 41 per cent of travellers would take more risks in the knowledge that the trip had emergency cover. This taps into the younger market, who take more risks on holiday and are generally more tech-savvy.
Integrating technologies is a way of creating more customer-centric options. To capitalise on revenue-generating opportunities, insurers have kept the focus on the digital transformation of their operations, such as predictive analytics, machine learning, telematics global positioning system (GPS) and live chat.
One of the most important outcomes of digital transformation is increased efficiency. Claims can be processed instantly via an app, and policy writing is less labour intensive with machine learning.
Digital technologies also help insurers future-proof the travel insurance business. Data analytics can assist in collecting information on what customers are looking for and create a tailor-made policy.
Flexibility in travel insurance product design
With concerns over the escalating cost of living, a competitive travel insurance price can be high in the decision-making process of a customer. According to data from two leading sites, Compare the Market and Confused.com, the average price of an annual travel insurance policy increased by around 50 per cent between August 2019 and August 2020 for both European and global cover.
Personalisation of cover brings opportunities to insurers to offer a wider range of products that can appeal to customers with different price points. For instance, IMG is offering iTravelInsured Essential, a cost-effective package for price-conscious travellers seeking basic trip protection benefits. IMG’s lowest-priced protection programme allows clients, such as US residents travelling domestically, to protect their prepaid, non-refundable trip costs with the most fundamental travel insurance benefits. The iTravelInsured Essential plan has limited travel protection with coverage for trip cancellation and interruption, travel delay, and accidental death and dismemberment.
Accurate, real-time data can assist with proactive claims and loss notifications, so news of a travel disruption can be fed into processing claims or arranging a new flight
Personalisation via technology is also used to good effect by Allianz – the company’s SmartSample product harnesses machine learning to work on predictive models for generating online insurance options. The technology uses AI, crunching data from 100 individual and trip data elements to produce an insurance offer with benefits tailored to individual needs and requirements.
Accurate, real-time data can assist with proactive claims and loss notifications, so news of a travel disruption can be fed into processing claims or arranging a new flight.
Cover-More (part of Zurich Insurance Group) launched the Webex Contact Center, a cloud-based omnichannel, which offers real-time global reporting and data analytics across its entire global customer service network. The company says this move has already saved 30 per cent of its operating costs year-on-year – a welcome respite from escalating claims costs.
Digital solutions are a vital part of a travel insurance company creating the features, functionalities and applications they need to stay competitive in the market. By not only keeping up to date, but ahead of technological advances, expanding sales opportunities can be exploited.