By Brendan Wycks, Co-Executive Director, CAFII.
New research by Deloitte Canada has found that collaboration across distributors, underwriters and even regulators of Credit Protection Insurance (CPI) is key to delivering the type of “best-in-class” digital experience that Canadian consumers have increasingly come to expect.
According to the Deloitte study, which was commissioned by CAFII, digitization is one of the insurance industry’s most prominent and disruptive trends; and it demands that the industry respond with new and innovative business models and customer experiences.
The report identifies key trends that are driving the need to transform the insurance business, including:
- Consumers expect more seamless, convenient, and personalized digital experiences from their insurers;
- Growing competition from new entrants with tech-enabled business models; and,
- Increased availability of data and use of advanced analytics have made it possible to generate deeper and more precise customer insights.
In order to deliver an industry-leading digital experience for consumers, the report says that insurers need to have certain attributes and underlying capabilities, including:
- A well-defined digital business strategy which provides absolute clarity around how customers, products, and purchase channels will be supported;
- Be highly customer-focused in how they do business and use a human-centred approach in designing their end-to-end user journey and digital experience;
- Use data-driven insights to inform business priorities, product development, and customer experiences; and,
- Embed a digital culture, skills, and ways of working throughout the organization in order to drive a holistic culture of innovation.
The report found that there are unique challenges facing Canada’s CPI industry, accentuated by the multiple stakeholders involved including underwriters, distributors, and regulators. For example, the CPI digital experience is highly dependent upon the borrowing journey that consumers go through when they want to take on a new loan obligation (e.g. mortgages, Home Equity Lines of Credit, car loans), and the regulatory environment for that journey can be difficult to navigate digitally, due in large measure to a lack of harmonization across the provinces and territories.
Despite those challenges, the CPI industry is committed to delivering on consumers’ digital experience expectations, with 100% of the CAFII members surveyed by Deloitte indicating that digitizing CPI is a top strategic priority, and 43% saying that they are targeting having up to 40% of consumers’ CPI applications and enrolments be fully digital by 2025.
What’s more, CPI distributors recognize the need for greater multi-channel alignment, with 86% of CAFII members indicating that cross-channel integration is key to creating seamless and satisfying digital CPI experiences for consumers.
The Deloitte report is the latest in a series of research studies commissioned by CAFII over the past seven years that have looked at customer satisfaction with CPI and travel insurance, and how the Association’s members can meet or exceed consumers’ evolving expectations.