Brits on guard: Just 30% of insurance policy holders trust insurance providers to manage data securely

While household devices may be more intelligent than ever before, and hold the potential to offer insurers a wealth of personal information, it seems that many Brits are wary of how their data is being protected. Indeed, Mintel’s Consumers and Data Sharing in Insurance UK 2017 Report finds just 30% of British insurance policyholders say they trust insurance providers to manage data securely.

Highlighting just how cautious Brits are about potential information available to providers, today, as many as 40% of policyholders go so far as to say they do not trust insurers to manage data securely. What is more, some 30% of these consumers say they would rather pay more for insurance than hand over more personal data than necessary.

Top data sharing concerns include fear that smart devices could be hacked or open to security breaches (78%), while just over three quarters (76%) worry that insurers might sell their data to other companies.

In terms of what information is made available, the majority of Brits are comfortable sharing basic personal information with insurers, such as their age (77%) and their marital status (69%); however, there is a general reluctance to share data that could be deemed more sensitive or even intrusive. Indeed, only one in 10 (10%) consumers who have insurance would be willing to give providers access to their real-time location, for instance via a smartphone app, while just 10% would feel comfortable granting them access to information stored on their social media profile.

Paul Davies, Senior Financial Services Analyst at Mintel, said:

“Consumers are sceptical about insurers’ ability to handle their personal information. This appears to be strongly influenced by consumers’ concerns about how insurers might monetise their data, as well as a lack of faith in the robustness of smart devices or systems that could be used to store or transmit personal data. Insurers would be wise to take a proactive approach to tackling the issue of privacy, and for some this could even result in data policies becoming a key part of their company’s brand image as well as their reputation. Use of consumers’ data will without doubt become a more prominent topic over the next 12 months, meaning brands that take a public stance to assure consumers about their privacy could enhance their appeal.”

Overall, more than two thirds (69%) of policyholders already own or are interested in owning an emerging smart device, such as a smart smoke detector, smartwatch or pet tracking device. But the connected devices that have the widest appeal among policyholders are those that offer consumers increased security around their home. Nearly half (47%) of insurance owners are interested in owning or already own a smart smoke detector, whilst smart surveillance cameras (39%) and connected door locking systems (38%) also have appeal.

Away from home, a third (33%) of Brits are interested in owning or already own a smartwatch or fitness band, and just over a quarter (27%) are interested in owning or already own an in-car device which measures driving habits and behaviour. Meanwhile, just under a quarter (23%) of Brits are interested in a pet tracking device.

“The Internet of Things offers insurers a huge opportunity to develop much needed regular touchpoints with their policyholders. This could help to improve customer retention by moving the focus of communication away from the annual policy renewal. The majority of existing or potential owners of emerging smart devices say they would share data from these devices with an insurer, suggesting that providers could be well positioned to give consumers access to a better connected ecosystem.” Paul adds.

Despite the fact that most Brits have concerns about potential data breaches or unwanted sharing of their data, three quarters (75%) of policyholders say they could be encouraged to share more personal information with insurers in exchange for a range of benefits. While a discount on a policy is the most wanted incentive among consumers (51%), two in five (41%) adults would simply like clear information on how their data is used. However, insurers still have some work to do in order to reassure consumers that they won’t end up paying more for a policy as a result of sharing additional information. Indeed, 56% of insurance owners worry that by sharing extra data with insurers they might end up paying more for a policy.

“While consumers tend to be hesitant to voluntarily give brands access to their data, many will often be swayed by the offer of a financial incentive. In this case, it is clear that most people hope that insurers would recognise their positive behaviours and offer a discount on their premiums as a result.” Paul continues.

Finally, more than three in five (63%) policyholders would like to see a breakdown of how their premium is calculated. Meanwhile, 54% of policyholders would like to view customer ratings or reviews when comparing quotes and 39% would like to know what percentage of claims a provider has paid out on. When deciding on which company to go with, just under a quarter (22%) would like to receive information on an insurer’s ethical or charitable stance.

Overall, the vast majority (87%) of consumers have at least one type of insurance policy, with home (66%) and car (64%) by far the most popular products.

“It is clear that consumers want providers to be more transparent when it comes to the information they supply. By making these types of information more prominent on customer communication, insurers could gain consumers’ trust, as well as appease those who may feel aggravated by recent price increases.” Paul concludes.

Press review copies of Mintel’s Consumers and Data Sharing in Insurance UK 2017 Report and interviews with Paul Davies, Senior Financial Services Analyst at Mintel, are available on request from the press office.