Insurance Marketing Trends 2017: How’d we do?

Earlier this year, Mintel Comperemedia released a series of marketing trends across key industries, including insurance. The three Insurance Marketing Trends we identified for 2017 were:

• In Layman’s Terms: Simplification of insurance will go well beyond ad language and creative mascots and expand into understanding the product on a deeper level as insurers attempt to explain the “why” and “how” in more meaningful ways.
• Single Serve: The long-term commitment of insurance continues to be off-putting to some consumers who gravitate toward products that focus on the solution for today, with less focus on potential benefits that might go unrealized.
• Smart or Spooky?: Insurance companies will continue to walk a fine line between customization and creepy as they work toward more sophisticated uses of data and smart tech that will satisfy both the tech-focused and the skeptical.

As we prepare to release our trend predictions for 2018, we take a look back on how our 2017 trends played out.

In Layman’s Terms

After remaining relatively unchanged for over a hundred years, the insurance industry has embarked on a sweeping transformation spurred by digital innovation and an influx of venture capital funding. The trend ‘In Layman’s Terms’—which encapsulates consumers’ growing demand for simplicity and transparency from insurance carriers—has quickly moved from an emergent preference to a mainstreaming expectation. Insurance companies are no longer asking if they should explore new coverage techniques or consumer engagement strategies, but rather how.

Over the past several months, insurance companies—new and old—have hurriedly debuted and/or enhanced consumer-focused apps and AI tools to cross the convenience divide. USAA, for example, has developed a top-rated mobile app, which features voice-enabled navigation, Apple Watch capabilities and a broad collection of policy servicing-functions. Along with giving customers the ability to personally update policies and obtain quotes, it provides car-buying research and home value-tracking.

For customers looking for quick answers instead of full app experiences, chatbots have become particularly popular among Insurtechs and tenured insurers, alike. This messaging software enables insurance companies to offer scalable, dedicated customer assistance for relatively modest costs. Progressive Insurance is the latest carrier to jump on board, as it announced in mid-October 2017 that it was bringing its TV spokes-icon, Flo, to a chatbot experience via Facebook Messenger. Digital disruption has extended its broad reach across the insurance industry, but it has yet to achieve truly influential depth. While it is too soon to know what technology will come next, the principles behind this trend will almost certainly be fundamental to its foundation.

Single Serve

As access over ownership—the core tenet of the sharing economy—continues to influence consumer purchase behavior, would-be policyholders are taking an increasingly critical look at the traditional insurance model. Now, more than ever, consumers want insurance to cover just the items they want, during specific timeframes of their choosing. In early 2017, Insurtechs like Trov and Sure Insurance were just beginning to make news with their on-demand, hyper-focused insurance business models.

With 2018 around the corner, this trend appears to be growing in both scale and scope. Sure Insurance, for example, has expanded into additional areas such as smartphone coverage and has entered a partnership with large-scale insurer, Nationwide, to pilot real-time, mobile-based renters insurance. Similarly, UK-based Trov has announced plans to roll out coverage in several new countries including the US, Germany, Japan and Canada. Along with these two companies, many more have joined along the way. Zhong An, China’s first online-only insurer, now offers more than 100 unique insurance products including obscure policies such as insurance against alcohol poisoning for sports enthusiasts. In the summer of 2017, tenured insurer Allianz partnered with insurtech startup Flock in the UK market to launch on-demand drone insurance for commercial and recreational users through a mobile app. If the past year is any indication, it is likely that insurance coverage will only become more flexible and nuanced as insurance companies continue to experiment with new risk and digital distribution strategies.

Smart or Spooky?

For as long as societies have celebrated the new capabilities that technological advances bring, there have also been lingering concerns in regards to the potential costs. For much of history, these concerns were relegated to employment implications (machines taking jobs away from people) and broad reservations in regards to man’s increasing reliance on machines. Over the past few decades, however, the developments of smart technology, monitoring systems and the expansion of data analytics have joined together to introduce a new cost for digital progress: personal privacy. This is especially relevant to insurance as market forces drum up demand for seamless, data-intensive consumer experiences.

In 2017, the ‘Smart or Spooky?’ trend spoke to how insurers were just entering this new, digital world. The mandate was to harness and apply valuable user data for improved product design and engagement, but to do so respectfully and judiciously. Admiral Insurance, a UK firm, was one of the first carriers to run afoul amid this delicate new dynamic. In late 2016, it had intended to launch an app offering discounted car insurance premiums based on algorithmic assessments of consumer Facebook posts. Facebook forced the insurer to cancel its plans, however, noting that the app violated platform policy, which puts strict limits on how developers can use the information users share with them. While that was one misstep, the industry as a whole, forges ahead. In 2017, for example, we saw the launch of an underwriting tool that collects personal information from an applicant’s “selfie” photo. The technology, developed by Lapetus Solutions, allows for an insurance company to instantaneously calculate a user’s BMI, physiological age and identify a history of smoking. So far, a handful of carriers are quietly testing the new tool, including Legal & General and Quilt. As insurers close out 2017, they continue to face the tenuous data-privacy balancing act and it’s almost certain they will do so for the foreseeable future. Expect to see more small-scale experimentation and trial-runs in 2018 as carriers cautiously navigate this new terrain.

Caitlin Moling is the Director of Insights, Insurance for Mintel Comperemedia. She combines her deep knowledge of the complex insurance industry with consumer research, industry trends and competitive marketing intelligence to build timely and meaningful stories for Mintel’s insurance clients. As a part of her role as a thought leader for insurance, Caitlin travels throughout the US and Canada to present insurance marketing trends and insights to major industry stakeholders.