TORONTO--(BUSINESS WIRE)--Capco’s new survey of consumer attitudes to insurance identifies an opportunity for Canadian insurers to deepen engagement and build longer-term relationships with young adults between 18 and 34 years old– a vital customer segment for insurers’ future growth and success.
The survey by Capco, the global technology and management consultancy, polled 1,000 Canadian policyholders between the ages of 18 and 65 years. It found that 83% of all respondents – rising to 92% of young adults – are prepared to share additional personal data with an insurer. Young adults are more inclined (39%) to share such personal data specifically to receive more tailored services, compared to 32% of middle-aged adults and 27% of older adults.
At the same time, young adults are most likely to only hold one insurance policy (45% compared to 36% of middle-aged adults and 25% of older adults). This presents fertile ground for insurers looking to win the hearts and minds of individuals who have the potential to be loyal customers for the next 50 years.
In a competitive insurance market like Canada’s, differentiation is essential for insurers as they look to attract and retain customers of all ages. The ability to create and leverage expansive high-quality datasets that better capture customers’ needs and preferences will be key as insurers pursue differentiation via the enhanced personalization and service levels that consumers want.
Consumers are feeling the pressure of inflation and the rising cost of living, and the survey highlights the perceived importance of affordable premiums and value for money when buying insurance. Cost is also the leading reason for not purchasing insurance cited by an additional cohort of non-policyholders contacted during Capco’s research.
Lance Levy, CEO of Capco said: “Canada’s insurance industry is experiencing a profound transformation driven by technological advancements, evolving customer expectations, and shifts in market dynamics. It is imperative that organizations double-down on establishing a data-driven and customer-centric culture to enable them to make timely and informed business and technology decisions. More than ever, insurers need to develop strategies and tools to effectively collect, manage, and leverage data to drive their digital transformation initiatives and achieve the outcomes that their customers desire.”
Ben Kosic, Partner and Canada Insurance Lead, said: “It all starts with the customer. As an insurer, do you understand the needs of your current and future policyholders? Do you have the data to understand those needs, and develop the personalized products to meet them? And can you then provide exceptional customer service to acquire, support, and retain these customers? To achieve those goals, it is more important than ever for insurers to be agile and able to address short-term imperatives while implementing longer-term digital transformation.”
Capco’s 2023 Canada Insurance Survey captures policyholders’ attitudes across areas that include type of policy held, levels of confidence and knowledge about insurance products, preferred channels for purchasing coverage and communicating with insurers, use of apps, and experiences of the claims management process. Findings include:
Long-term savings such as investment-linked insurance, annuities and endowments are #1 in the top five most desired personalized offerings (76%).
- Next most desired insurance products – income protection (75%); pet (68%); travel (66%); health (65%).
Affordable premiums and value for money are important to everyone, but particularly for older adults.
- Affordable premiums – 54% of all respondents, 66% of older adults.
- Value for money – 53% of all respondents, 58% of older adults.
When asked to choose their preferred methods of data sharing, smart devices in the home (31%) was the leading choice.
- Next most preferred – fitness/health tests (27%); smart watches/wearables (23%).
When selecting an insurance provider, Canadian policyholders’ place the most value on scope of coverage (48%).
- Next most valued – reputation (46%); speed of service such as application processing and claims settlement (36%); ease of application process (29%).
Use of apps is described as a positive experience by 77% of respondents; payment options is the most valued aspect of an insurance app (42%).
- Only 2% of respondents described their app experience as ‘poor’.
- Other valued aspects of apps – convenience/accessibility (39%); ease of use/user friendliness (39%); services available (38%); data protection (32%).
More than a third (35%) of survey respondents holding multiple insurance policies use a single insurance company to meet all their coverage needs.
- Average number of polices held – 2.22; average number of insurers used – 2.04.
Capco’s 2023 Canadian insurance survey can be downloaded here. Capco’s latest global insurance survey was conducted during February and March 2023 and collected responses from 13,750 policyholders aged 18 to 65 years across Canada, the US, UK, Brazil, Germany, Switzerland, Belgium, Poland, Italy, Hong Kong, Greater Bay Area (ex Hong Kong), Singapore, Thailand, and Malaysia.
Capco, a Wipro company, is a global technology and management consultancy focused on the financial services industry. Capco operates at the intersection of business and technology by combining innovative thinking with unrivalled industry knowledge to fast-track digital initiatives for banking and payments, capital markets, wealth and asset management, insurance, and the energy sector. Capco’s cutting-edge ingenuity is brought to life through its award-winning Be Yourself At Work culture and diverse talent. To learn more, visit www.capco.com or follow us on LinkedIn, Instagram, Facebook, and YouTube.