7 ways digital customer journeys can improve the onboarding experience in personal lines insurance

Property and casualty (P&C) insurance is a lucrative market representing about one-third of the insurance industry with approximately $1.6 trillion in premiums.  Market rates for personal lines have been accelerating rapidly. According to Insurance Business America, the composite rate for personal lines was up 6.3% in the fourth quarter of 2020, signaling continuous price increases, especially for the owners of large homes. Following the natural disasters pattern in the US and Australia, homeowners in the affected areas saw the rate increases as high as 20% to 30%.

For customers, the only way to offset the skyrocketing rate increases is to shop around for the best insurance offers, limit coverage or raise deductibles. This means that competition to acquire and retain customers is getting more challenging for insurers, as customers are shopping around and are willing to switch to competitors for the best deals, coverage, and quality of service.

Customer experience comes to the forefront in the onboarding process

Core insurance workflows such as purchasing, canceling, or updating insurance policies were once only available face-to-face. But today, these processes are transitioning into digital self-serve portals. Digital channel is quickly becoming one of the main channels for customer acquisition based on consumer behavior changes driven by younger, digitally-native consumers.

One of the customer journeys in insurance critical to getting new customers up and running quickly with their coverage is the virtual onboarding journey. Getting the digital onboarding process right is the crucial first step in winning and keeping tech-savvy customers.

Onboarding is a crucial first step for customers' relationship with their insurer. But it is also one of the most difficult ones to get right. 

‍

38% of customers say that user experience is the most significant factor when choosing a digital service. But when it comes to the quality of customer experience, many personal lines insurers are rapidly falling behind. 

‍

The onboarding experience in insurance has a long way to go. Digital onboarding often represents a collection of disconnected and disjointed digital touchpoints rather than a seamless end-to-end experience.

According to Deloitte, nearly 40% of customers abandon onboarding journeys in digital channels without completing the process. The customers are most likely to abandon their application when the onboarding process takes too long or requires more information than people are willing to disclose. When insurers don't get the onboarding right, drop-off rates skyrocket, and would-be customers are lost forever.

From clunky paperwork to seamless digital onboarding

With many different touchpoints and dependencies, the process of onboarding a new customer is often overly complex and slow. 

Onboarding requires identifying a customer's identity with a high level of security and a low level of risk. This requires multiple steps, supporting documents, and customer interactions, which can be fraught with friction, manual tasks, and inefficiencies.  

Filling in paperwork is one of the experiences that make onboarding difficult. As part of onboarding, multiple documents need to be gathered from a new customer. Forms must be filled and signed. Then these documents need to be validated, and the customer’s identity must be verified as part of the approval. 

Collecting customer data and signatures is something that insurers cannot avoid, and this is often the most frustrating part for the customer. At the same time, customers expect a seamless and quick experience without delays or interruptions. 

These competing priorities are challenging to balance. 

In a competition to acquire and retain customers, insurers must find ways to simplify the complex, multi-channel process of onboarding customers to a new insurance policy into a streamlined and seamless digital workflow.

How can we consolidate the customer onboarding process into a single digital workflow that saves time and stress for both the agent and the customer? The answer lies in creating digital customer journeys that combine seamless front-end user experiences with efficient, automated back-end processes.

• Speed – customers are not willing to wait and won't tolerate delays
• 100% digital - must be available anytime from anywhere
• Channel agnostic - available on mobile, tablet, or laptop
• Paperless – digital with no paper forms or contracts to sign, including digital PDFs or scanned documents

Turning to no-code tools to deliver digital onboarding journeys quickly and at scale

For legacy insurers, adapting to the new digital reality is not an easy challenge. Digital transformation requires a departure from traditional business models and conservative attitudes. It also requires a shift to a new leadership mindset and a new digital culture, and sizable investments. 

Enterprise digital transformation often turns into years-long and complicated endeavors that end up costing billions and often fail to deliver on its objectives. Four out of five digital transformation initiatives fail to reach their desired goal, amounting to an astounding 80% failure rate.

Successful digital transformation solutions require technologies that simplify and accelerate digital transformation without adding complexity. One such technology is low-code/no-code development platforms. 

These tools empower business users without coding knowledge to quickly spin up digital experiences and applications at a fraction of the cost and in a matter of days. And best of all, replacing paperwork with digital customer journeys is the perfect task for such a platform.

7 ways replacing paperwork with digital customer journeys improves the customer experience in insurance onboarding

‍

1. Create a real-time experience for the customer

When it comes to digital onboarding, nearly 40% of customers give up and drop off before completing their application. Main reasons for drop-offs include:

• The onboarding process takes too long 
• It requires more information than customers are willing to disclose
• Bad user experience or friction
• The requirement to take additional actions such as uploading documents that might not be readily available on hand
• Lack of mobile-friendly UI

Fixing CX issues and eliminating waiting times between the application and the policy onboarding significantly improve customer experience quality.

2. Only ask relevant questions with conditional logic

By solely asking relevant questions and pre-filling information that the organization already has on the potential customer can eliminate frustration and simplify the onboarding process. Unlike PDF forms with fixed questions, digital customer journeys are flexible and can change each subsequent step based on the answers to the previous questions.

By avoiding irrelevant questions, an insurer can significantly reduce the drop-off rates in their onboarding journeys.

3. Remove the need for additional actions with digital ID verification 

Digital identification and digital signature are transforming the onboarding experience financial sector. By adding digital ID verification and eSignatures to the onboarding journey, customers don't need to do any additional actions such as a scan or email. By eliminating additional steps, the onboarding completion rates skyrocket.

4. Simplify backend processing for faster response

By collecting data digitally, insurers avoid the need for data entry, thus avoiding delays and errors in data. By adding advanced validation rules, the organization can ensure that the data collected is 100% accurate and correct at the point of entry. 

This significantly accelerates the onboarding process and eliminates back-and-forth data collection calls and emails with the customer. Automated backend processing workflows become highly efficient and fast when based on verified and accurate information.

5. Add personalization 

Customers understand that they must provide personal data. However, they expect that their service provider will use this data to improve their experience. Insurers can use "what they already know" about the customer to enhance their experience and make tailor-made offers that suit the customer's needs exactly.

6. Digital eSignatures - legally binding

By eliminating the need for wet signatures, insurers can significantly accelerate the onboarding process and ensure that the onboarding can be completed digitally without sending any physical documents or visiting a branch. 

‍

7. Streamlining payment processes

Insurers can easily integrate digital onboarding journeys with digital payment solutions to streamline payouts and premium payments. Customers can add means of payment at onboarding and never think about this again, whether they need to make a claim or adjust their policy package.

‍

While the remote servicing trend has been with us for quite a while now, the recent lockdowns and the ongoing COVID-19 pandemic have further accelerated this ongoing trend. 

Consumers today want the ability to do anything from anywhere and are unwilling to wait.  

Insurers can quickly answer the demand for digital onboarding by turning to a no-code platform with the technology to develop digital onboarding journeys for their customers quickly.