Consumers' increasing love of technology could revamp the insurance industry, but many in the profession are underprepared for the change ahead, a report out today has found.
According to the Capgemini and Efma's most recent annual World Insurance Report, most modern day consumers, particularly those from generation Y, have vastly different needs and demands that traditional insurers risk being unable to meet.
As a result of this disconnect between the sector and younger consumers, generation Y reports being significantly less satisfied in their dealings with insurance companies, despite general customer satisfaction across other age groups increasing. While more than half (55 per cent) of customers from other generations say they have a positive experience with their insurer, just a third (34 per cent) of generation Y feel the same way.
Generation Y is also more likely to want to engage with insurance providers on a regular basis, including through channels like social media, but insurers are frequently failing to meet this need.
"Customer needs and behaviours are evolving as customers respond to the steady advance of technology in their everyday lives," the report read. "Increasing familiarity and comfort with digital channels is expected to result in customers of all age groups seeking out greater interactivity with their service providers."
Meanwhile, the internet of things has affected the way people interact with everyday objects, changing the way insurance products have to be approached.
However, customers predict that they will adopt new technology, such as driverless cars, in greater numbers than insurance professionals believe they will.
"Connected technologies are changing the way consumers live their lives and, in effect, altering their needs related to insurance," the report continued. "Innovations including smart ecosystems, wearable devices and driverless cars are not only simplifying everyday life for consumers, but also changing the fundamental nature of insurable risk."