• December
  • 2020

Level-up Your Insurance Customers' Engagement by Leveraging Seamless Finance

The insurance industry has been slow to adopt digital transformation; however, in a recent Accenture study, 90% of insurance executives say they have a digital transformation plan in place. The highest category of response to the question of which technologies will have the greatest impact, with 63% agreeing, was “cloud-based technologies to promote operational efficiency”. Adopting new solutions to add business value and improve client-facing processing also scored very well.

One challenge faced by insurance salespeople is the inability to activate millions of sometimes dormant customer accounts because they lack the tools to engage with customers.  Companies can now quickly onboard new tools, often provided as APIs, to enhance customer engagement.  Hosting a calculation tool that allows customers to see their financial position in a simple, realistic, granular and holistic manner provides two distinct advantages: to attract new customers and retain existing customers to your franchise.  Focusing on retention is ever more important since recent industry investments in better onboarding are making it easier than ever for customers to switch providers. Selecting the right technology for your customers while building a consensus with your internal stakeholders is the role of the technology champion.

Customer Needs 

What do policyholders want from their insurance provider? Studies show that most people have little knowledge of financial planning. High earners usually have wealth advisers and trade union members may get assistance from their organisation. However, the advice gap is in the middle, among retail and mass affluent consumers. These people have good incomes and are saving for the future, but they lack a big picture view of their finances.  Providing a service to help these customers will differentiate insurance providers, and that is how Kidbrooke’s OutRank can help.

Three capabilities are important. The first is providing realistic economic scenarios. This is usually done via an economic scenario generator.  The software should be intuitive with a simple workflow so that customers can visualise what their portfolio looks like. The second feature is a balance sheet simulator or cash flow generator, which can evaluate customer portfolios across the many different scenarios provided by the scenario generator.  The system should be agnostic to the asset class and be able to show positions across equities, credit, pensions, etc. consistently, thus avoiding the silos that some calculators present. The third attribute is a financial decision support.  Here a common choice is methods based on modern portfolio theory. Although widely used, it typically underestimates the risk of certain decisions. Alternatives such as Kidbrooke’s OutRank based on utility theory are also available in the market. These allow for a more nuanced consideration of customer’s risk profiles; especially in conjunction with more realistic economic scenarios properly capturing the risk posed by economic crises.

All customers need to balance risk and reward, and a simple, user-friendly tool empowers them to do that in a way that is visually compelling and easy to understand. Some financial planning tools have a complex user interface with a variety of features that do not add value. A good solution should provide a clean journey with a workflow that showcases different scenarios and hypothetical performance situations.  As an example, Kidbrooke’s OutRank currently supports short-to-medium term savings, credit advice, pension plans, financial planning and liquidity forecasting, for a comprehensive view of the customer’s aggregate financial position.

IT Requirements 

IT leaders face several competing objectives: to increase the capacity of their infrastructure and strengthen the resilience of core operating systems while at the same time keeping costs controlled. When working with third-party vendors, IT teams will balance the desire for features and functionality of client-facing applications with the need to protect the stability of the technology stack with robust maintenance protocols.  It is important to minimise downtime when a data refresh is necessary.

Building a consensus with IT to consider the right vendor is essential. Selecting a cloud-native vendor as your partner should reassure them that the solution you recommend has immediate response times, cost-efficient support for heavy load and a reasonable cost. The cost savings can be significant, with a cloud-based provider operating at 25% of the cost of comparable legacy, non-cloud offerings. Maintenance is efficient, with no down-time required for the refresh of scenarios. For example, Kidbrooke’s OutRank is fast, scalable and affordable, an API with a demonstrated track record of seamless integration into the technology stack of a large insurer.

Vendor Risk Management and Procurement 

Your company probably has a rigorous process for assessing software partners and may have a dedicated Vendor Risk Management team in addition to the Procurement group.  They will want to be certain that the vendor has robust policies and procedures relating to network security management, incident response, cybersecurity and data beaches.  Before a vendor can be signed and onboarded, they must be evaluated for change management and change control procedures and how they use metrics such as KPIs and KRIs to drive continuous improvement. Risk management specialists will need to understand the internal risk processes within vendor companies, including data backup, data destruction and disposal as well as general governance policies.  
Kidbrooke was vetted by the largest insurance company in Sweden over an extensive procurement review process. We are confident that our risk management awareness and procedures are resilient.

Compliance and Audit 

Treating customers fairly is at the top of the compliance agenda. Too often, customers are asked to use a “black box” model of summary statistics and approximations to generate financial calculations that contain hidden assumptions or biases. Customers benefit when assumptions are made clear, and all the scenarios generated by a tool are transparent. Any customer-facing tool must respect the regulatory regimes, including data protection rules, of each country in which customers are located.  It is advisable to get Group Audit on board with vendor selection. They will want to have a view of a vendor’s audit procedures and document retention. In the contract, your legal team should specify the “right to audit” the vendor.

In the case of Kidbrooke, all the OutRank assumptions are transparent to the customer.  The data outputs are kept by the client, in compliance with GDPR and other regulations, and are therefore auditable.

Sales, Marketing and Product Management 

Delivering new capabilities to serve customers is perhaps the most significant impact of digital transformation. Getting the sales and marketing teams motivated to adopt new ways of collaborating to grow the business will be one outcome of using OutRank. Doing a deep dive on customer behaviour and experimenting with campaigns to test different propositions will yield key insights into customer preferences and willingness to purchase new products.  This data will feedback into the product teams, who can develop the next generation of products to attract and retain your customers.

Are you ready to jumpstart your sales strategy for 2021? Visit us at kidbrooke.com.

To read the Accenture study, please visit:


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