- Motor insurance, on a risk management level, is heavily commoditised. To an extent, 84% of insured drivers in the UK shop for a new insurer each year. Retention is a major cost.
- Insurers have very limited customer interaction: you only talk to an insurer when you renew or when you make a claim. Evidence suggest more interactions enhance the customer satisfaction levels
- Motor insurance plus a service, which may have valuable data to the customer, is not commoditised. If you switch insurance provider, you will at least lose the format that the data and service is presented
- Note: adding breakdown cover is a service but everyone can do it. So you are still a commoditised insurance product.
Below are just 2 examples from Bain and McKinsey. Many of the potential services are related to connected cars – which may need an OBD2 device – that are aimed at analysing car data.