In the introduction of its 2024 Global Insurance Outlook report, Deloitte discusses the transformation of the insurance model: "Existential threats [...] are driving many insurers to reimagine how to confront disruptions caused by the changing environment and help consumers across all segments prevent or mitigate risks before they occur, rather than merely paying to rebuild and recover after the fact." The widespread adoption of prevention programs, therefore, appears as a sustainable solution to offset fluctuations in the combined ratio.
The good news is that it has never been easier to implement a prevention program and measure its effects, thanks to digital technology. Take the example of auto insurance. Workshops and awareness campaigns have always been preferred actions by insurers. In addition to these historical methods, some insurers are deploying digital-based prevention solutions, like Covéa with the DrivMeUp program.
This program helps Covéa policyholders improve their driving behaviour by analysing their driving through mobiles. The solution is easy to deploy, as policyholders only need to download a mobile application. The advantage of this smartphone-based solution lies in measuring policyholders' driving behaviour progress over time. Progression is made possible through personalised advice available in the app and implemented incentive mechanisms (driving challenges).
Our experience shows that deploying smartphone-based prevention programs allows insurers to reconnect with their customers by creating and increasing touchpoints. For example, a policyholder might be surprised by the gap between their perception of their driving behaviour and the assessment provided by the mobile app.
The policyholder's questioning initiates a constructive dialogue with the insurer about road risk. During this exchange, the policyholder feels acknowledged and becomes more aware of their room for improvement.
Moreover, from this insurer-policyholder dialogue generated by smartphones, there often results a noticeable and measurable change in behaviour over time!
Digital technology enables the deployment of prevention programs on a very large scale at a low cost, while reintroducing a human presence in customer relationships.