3 Tips For Sustainable Success In Direct Insurance

Direct insurers have found success in recent years through innovative business practices. But how can they withstand new, even leaner competitors? Let’s find out more.

 

Over the last ten years, direct insurers have grown significantly faster than traditional insurers. They managed to do this by cutting out the middleman and engaging directly with their customers. They also operated on much leaner business models, which enabled them to thrive even in a market with high customer churn, more claims, and downward pressure on prices. 

 

However, there is a new challenge for direct insurers. New insurtech companies, backed by venture capital firms have entered the market, using methods previously employed by direct insurers to beat them at their own game. In this article, we’ll look at three things direct insurers can do to withstand these new entrants. 

 

1 - Go digital

 

Traditionally direct, insurers use call centres to field customer queries. However, that’s an expensive way to do business in today's environment. New digital-native entrants exist entirely online.

 

Invest in technology that allows you to move as many interactions to digital as possible. Increasingly, customers are comfortable making purchases and asking questions online. But remember, going digital doesn’t mean you have to compromise on customer experience. For example, make sure you always respond quickly to customer queries, even if they arrive as a text rather than a call.

 

2 - Lower your sales and marketing costs

 

Your new digital-first competitors are achieving spectacular growth rates because they are acquiring customers at a lower price. They are doing this through sophisticated digital marketing methods, engaging with customers where they are. So, take a leaf out of their book. Double down on marketing channels that produce good returns and invest in marketing technologies that enhance personalisation and boost conversion rates.

 

On top of this, examine how you look after your existing customers to reduce churn. It costs much more to win a new customer than to keep an existing one, so treat them well all year round, including at renewal time. 

 

3 - Overcome obstacles to scale

 

The bigger you get, the harder it is for a new entrant to catch up with you. It has always been a challenge for direct insurers to scale as the marketplace is crowded, with comparison sites making it a winner-takes-all game based solely on price. But today, scaling is a matter of life and death.

 

One way to boost your position in the marketplace is to share services with other direct insurers, such as tech procurement. Forming a block in this way means you can get better deals from your suppliers. However, choose your partners wisely. You don’t want to be held back by companies who are not as agile, flexible or forward-looking as yourself.

 

Find out more from 360 Search

 

Follow our three tips to boost your chances of success in today’s digital-first direct insurance marketplace.

 

Are you looking for a new talented professional to join your team, our specialist recruitment consultants are on hand to help with all your recruitment needs. 

Email us info@360search.ie or visit 360search.ie to find out more.

 

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