The new proposition was designed in response to increasing public hunger for agile, personalised insurance cover, with HSBC research finding that customers named ‘convenience’ and ‘flexibility’ as their top priorities when purchasing insurance. Subscription services were also found to be notably more popular than fixed contracts.
Select and Cover allows HSBC’s customers to choose from travel, mobile phone, gadget, home emergency, life, excess protection and motor breakdown insurance – a minimum of three must be selected – beginning at £19.50 per month. A minimum of three must be maintained at all times, though individual options can be changed over the course of a year, and HSBC advises customers to combine covers in order to reduce the aggregate cost, saving money overall, compared with purchasing individual insurance policies for all different aspects of life.
Customers can cancel the policy at any time with no penalty, and policies cover the policyholder, their spouse or partner and their children.
Mark Hussein, CEO of HSBC Insurance UK, said that the subscription model reflected HSBC’s desire to provide customers with innovative new ways to experience its services. “Select and Cover complements our existing products by broadening our range, enhancing the speed and convenience of the application process, making insurance more appealing and accessible to customers,” he said. “Its rationale is very much in keeping with our business strategy to improve access to insurance and enhance our digital capabilities.”
Subscription insurance services certainly seem to be increasing in popularity – Consumer Intelligence carried out a survey last year which found that that 78 per cent of insurance customers would be likely or very likely to take out such a model, and interest in the concept has only increased since then. It will be interesting to see the impact that this sea change has on the industry as a whole.
Look out for an in-depth analysis on this topic in an upcoming issue of ITIJ!