global innovation - distribution lesson from overseas
TRANSCRIPT
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Kevin PledgeInnovation – lesson from overseas (and elsewhere)
acceptiv.com/crc
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Question
• 0 – 9%• 20 – 29%• 40 – 49%• 60 – 69%• 80 – 89%
• 10 – 19%• 30 – 39%• 50 – 59%• 70 – 79%• 90 – 100%
How much personal protection life insurance will be sold online 5 years from now?
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Agenda
1. The Situation in North America2. Innovation3. Two Examples from the UK
Beagle Street Aviva
4. Can this be Applied in Canada?
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A Problem
“It takes too long to issue our business”
Indicative Quote
Underwrite
IssueOfferAdd’l Q’s
Modify Application
Apply
Underwrite evidence
Further Questions
multiple hand-offslack overall process control
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Typical Solution
Indicative Quote
ApplyUW at claim!
or
Indicative Quote
Underwrite
IssueOfferAdd’l Q’s
Modify Application
Apply
Underwrite evidence
Further Questions
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Good(at least to industry insiders)
A recent announcement
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Good(at least to industry insiders)
…but not great
A recent announcement
70% will take more than a week
More than half will take more than two weeks
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Innovation
Is possible due to trends creating a discontinuous opportunity
Will question an existing paradigm
Often involve looking at the bigger picture or from another perspective
Disruptive Innovation will be: n times better, at 1/x of the cost
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Trends
1 2 3 4 5 6 70%
10%
20%
30%
40%
50%
60%
70%
Uninsured Households** Not Face-to-Face**
of Canadian Households believe they are underinsured*
Sources* LIMRA 2007** US data from LIMRA Household Trends in Life Insurance Ownership
LIMRA’s US Individual Life Insurance Sales Trends 1975 - 2009
is the average age of agents - DISCONNECT
of families with children will have immediate financial trouble if the primary wage earner died
57%
50%
57
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Paradigm
INSURANCE IS SOLD NOT BOUGHT
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Perspective
Look at the bigger picture and from the customer perspective
Issue is NOT agent productivity
Customers want choice
or
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Case Studies
New entrant – barriers to entryNot really an insurance companyNot encumbered by existing distribution
Largest insurance company in EuropeLife and P&C businessExisting direct and agent distribution channels - some online business
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Beagle Street – Online Only
Indicative Quote
Apply and UW
Buy
> 5,000x faster∞ scalable (85% of the time)1/10 of the cost
Fully UnderwrittenNo fluids or additional evidenceCover up to £750kBetter lapse experienceAve issue time 12 mins
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Beagle Street (UK)
New entrant – not really an insurance companyNot encumbered by existing distributionNo advertising for first two years, then…
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Need to integrate with existing distribution – Omni-channelCustomer service standards consistent with P&C
Online offers “n times” improvementIntegration expands customer base
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The Solution – AVIVA (UK)
Indicative Quote
Apply and UW
Buy
Furtherevidence
Buyor
Omni channelCustomer is in control
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Can this be applied in Canada?
Market research tested
Customers go to Google for information
Facebook and Google for advice
Disconnect with agents
Print: http://www.lulu.com/commerce/index.php?fBuyContent=15657323Ebook: http://www.lulu.com/commerce/index.php?fBuyContent=15663543
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Can this be applied in Canada?
Market research tested
“Almost half of participants found the value proposition [to buy directly online] very appealing (rating of 8 or more out of 10); these results are encouraging.
Years ago, when evaluating consumer interest in the ING Direct value proposition, our goal was to find interest in only half as many target group members (who we defined as innovators).”
Print: http://www.lulu.com/commerce/index.php?fBuyContent=15657323Ebook: http://www.lulu.com/commerce/index.php?fBuyContent=15663543
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• 10 – 30 year term insurance, up to $500k• Coverage age range 18 - 70• Applied UK experience and P&C lessons• Simpler, yet more flexible than current
products• No medical evidence referrals• Online, with offline support if needed
• On cover in 15 minutes or less
Full UW + Lower costs = Lower premium
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Full UW + Lower costs = Lower premium
MNS Age 40 $150K. Term Life Monthly Premium* Based on Acceptiv product design and pricing Feb 2015
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 300
5
10
15
20
25
30
35
40
Term
Premium
10 Year Term
Industry $18.65 – $20.30
Teachers Life
$13.46
20 Year Term
Industry $24.80 – $30.69
Teachers Life
$21.08
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https://www.youtube.com/watch?v=HWF09ya1o5I
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Kevin Pledgeacceptiv.com/crc
Thank You