A life coach as a holistic approach to personalised customer contact

If we take a look at the value chain of insurers, the potential for using artificial intelligence (AI) can be derived from every process. Chat and phone bots are the traditional solutions in marketing and sales. Logically linked approaches to personalised customer contact that ensure active and holistic support for the policyholders can revolutionise insurance sales.

The trend is moving away from viewing customers in terms of data and products based on their specific sector, and towards a cross-sector, holistic approach that encompasses every sector and uses external data – known as data lakes.

Placing the right offer at the right time with the right customer is the dream scenario of every salesperson. Insurance products have a major disadvantage compared to material goods in that they are not tangible. Their immateriality means the customer’s need must be demonstrated and interest must be actively generated. This is because unlike with a car, the prospective customer cannot be attracted to the products with prestige, the power of the brand or fun marketing materials. The contact does not always have to be made in the context of a specific product, but can also be a supportive or consultancy message, similar to a coach. The perception is changing in that the insurer is seen more as a life consultant or supporter. This creates a lasting loyalty and opens up a dialogue. The insurance idea of risk transfer remains unaffected, but the customer experience changes from experiencing risk to a positive feeling. The policy is transformed from a single product to a part of the insurer’s overall service and is perceived as a positive as a result.

Insurers must be proactive

This means that the core task of insurance sales is to generate new customers and to ensure existing customers remain loyal to the company in the long term by providing ongoing consultancy and managing their needs. The key to success is to individualise each customer to the greatest extent possible through deliberate actions and recommendations so as to ensure holistic, cross-sector support – because the life of the policyholder is not sector-specific.

First, however, it is advisable to perform a preliminary analysis of customers and segment them in the form of customer clustering based on data structured according to sales success to check which investment is actually appropriate. The type and intensity of the personalised customer contact depends on the result. Churn prediction approaches and the individual risk assessments for policyholders help to decide how intensive the contact should be the customer interface. Insurers can adapt their activities in order to best curb the cancellation and termination rate or reduce the resources needed to retain customers if the investment is not worthwhile.

The next-best action approach attempts to derive the next possible or next-best action on the basis of previous customer behaviour and thus propose targeted marketing measures. If the next-best action approach is transferred to the insurance industry, this results in a holistic needs analysis based on product forecasts in specific life phases and events of the policyholder. If the customer has reached a certain age and/or has lived through a decisive moment – such as starting a career, getting married, building a house or having a child – their individual insurance needs change or expand at and from this point in time. Future actions can then be derived from this event, be it specific products or general assistance in the sense of a coach. The insurer thus acts more as an active service provider and gives the customer a feeling of ongoing support and security.

This means that the key to harmonious and needs-based customer contact is combining cross-sectoral information and forming models that derive decisions from it.

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