Personas: Powering Personalized Insurance
Whatever the industry, consumers have always appreciated the idea of personalization; the idea that something, whether a product or action, has been designed or produced to specifically meet their individual needs. Over the past 10 years, insurers have looked to capitalize on this phenomenon and have become increasingly focused on the experiences of their customers to inform their digital strategy. By doing so, they are trying to achieve what McKinsey research refers to as the “personalized insurance engine,” a fully automated customer journey, from initial product research and sales to claims, that leads each customer through a convenient, data-driven experience that feels tailored to them and comparable to in-person interaction.i To power this engine, innovative insurers have embraced personas to best represent the interests of the various customer segments served. This is especially important to achieve improved customer response, stand out in the commoditized group insurance marketplace, and to succeed in an ecosystem where customers prefer digital interaction for straightforward, expedited transactions.ii For group insurers, the most significant customer touchpoints are during enrollment and the claims process, and personalization can ensure superior results and increase member satisfaction.
With personas as a tool to animate customer segments, insurers can build a personalized insurance engine with automated individualized, data-driven digital experiences that meaningfully engage customers of all segments.
How Personas Fuel Personalization
Personas are semi-fictional representations grounded in market research and insurers’ first-hand knowledge about existing customers. The real value of personas is that they bring personalization to life; instead of multiple, intangible, and generalized customer characteristics, personas actualize customer segments. For example, a fictional Jane Smith could be the persona to represent single, urban professionals that typically haven’t purchased disability. These personas are incredibly valuable, especially when shared with all involved team members, including developers, user experience, QA, and product owners, to be leveraged throughout the development process.
Leaning on these personas allows insurers to meet these members where they are and customize their digital experiences accordingly. Case in point: customers overall find group insurance difficult to navigate, as insurance is a fundamentally standardized product.iii With personas informing the team responsible for delivering a personalized insurance experience, customer interactions are more likely to be designed to ensure that each customer gets the most suitable product consistent with his or her individual situation.iv In addition, advanced analytics that parse vast amounts of data can further deduce what individual consumers need and can then determine the most suitable experience, including product recommendations, for their specific needs. This information can generate product recommendations and even AI-based chatbots ready to answer questions. For example, when a price-conscious customer is shopping for benefits, the engine can prioritize offerings and offer tangible examples that resonate with that individual for the most personalized and ultimately satisfying customer experience.
With comprehensive persona data, along with insurers’ willingness to wholly embrace customers’ views, the personalized insurance engine has a promising future, especially as insurers, insurtechs, and technology firms push its development. With personas as the backbone of its customer centricity and ease of use, the personalized insurance engine and its subsequent optimum customer experience can be realized for the benefit of all group insurance constituents.
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i “Revolutionizing Insurance: The Personalized Insurance Engine,” McKinsey & Company, March 11, 2021.
ii ”Delivering on Digital Customer Experience: Are Workplace Benefits Carriers Aligned With Employee Preferences?” LIMRA, May 20, 2021.
iii Op Cit, McKinsey