The future is now. We’re researching virtual reality, nanobots for health, and can even talk to coma patients without the use of invasive surgery. With all these advancements, our world is going to change how we interact with the economy, and therefore, insurance.
However, these changes come with some pushback. Not everyone is on board with progress, take Blockbuster for instance. They decided to opt-out of utilizing the internet to disperse their videos and look at them now.
Can the same be said for the insurance world? We as people are shopping differently, working differently, and expecting different results. What does this mean for commercial insurance?
How Are We Different?
It’s no secret what our demands are now: everything delivered and fast. With the rise of Uber, Shipt, and Doordash, we now can live our lives completely in the comfort of our own home. Why leave? We have Amazon to give us our essentials, and with their rising drone fleet, even that could be delivered on the same day.
We’re changing as a society to having our needs met within the hour they arise. Want a date? Download Tinder. Throwing a party? Order food and play music on your phone. Apps dominate our handheld ecology, further pushing this culture of the world literally at our fingertips.
Why Is This a Problem?
To put it simply, the insurance industry needs to catch up.
Some companies have, like Lemonade (homeowners and renter’s insurance) or Root (car insurance). They are the exception to the rule, however, not the standard. And this isn’t to say companies aren’t creating apps, some are, but the truth is, it only delivers information to people’s fingertips, not the power to change things.
Truthfully, the industry must expand its liability coverage. Not everyone goes to work in an office anymore. With the rise of freelancers comes a need to fit policies to an odd-shaped market. These freelancers are small-business owners, and a whopping 40% are uninsured, barely even looking at liability for their work life. And it makes sense, the policies offered just don’t fit their lifestyle.
Modern insurance contracts are clunky, long, and don’t favor short, bursts of work. For these gig workers, they need a snappy, instant digital certificate to insure them. Who wouldn’t chuck $5 at an insurance company for a BOP-lite policy for a 2 week period?
Small businesses are born online, further widening our technological world. How does an insurance company begin to cover these businesses? Some are fully remote, requiring cyber liability, and while useful, they aren’t optimized.
These business owners can live highly stressful lives, and constant market changes don’t support purchasing a hefty policy. If commercial insurance wants to snag this group of people, it needs to shift its focus to supporting what they need.
What Can Change?
The insurance industry can benefit from the overall interface of companies like Netflix, Doordash, and Amazon, meaning a focus on customer satisfaction and flexibility.
The new generation of small-business owners need policies that they can interact with at the flick of a finger, not another chore to accomplish like a meeting. And further, these policies need to be bite-size enough to not only explain fast but also be able to buy fast. Lowering policy coverage can also make it cheap enough to be a viable option for these small business owners.
Slap on an amazing customer service team with 24-hour availability (with a cute logo), and you’ve got yourself a whole new client base.