World Insurance Report 2013 from Capgemini and Efma

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Capgemini and Efma introduce the new Customer Experience Index in this sixth edition of the World Insurance Report 2013. Featuring data from over 16,500 customers, the report reveals 70% of insurance customers are at risk of competitive attack or switching carriers for even minimal benefits. The report explores how insurers must enhance multi-distribution and customer experience to improve retention. While mobile and social media channels are gaining traction, challenges remain for insurers to provide better customer experiences and drive operational efficiencies.

The 2013 Report covers both life and non-life segments including health. It draws on research insights from 41 countries: Argentina, Australia, Austria, Belgium, Brazil, Canada, China, Denmark, France, Germany, Greece, Hong Kong, India, Ireland, Italy, Japan, Lebanon, Malaysia, Mexico, Morocco, the Netherlands, New Zealand, Nigeria, Norway, Philippines, Poland, Portugal, Russia, Saudi Arabia, Singapore, South Africa, South Korea, Spain, Sweden, Switzerland, Taiwan, Turkey, UAE, U.K., U.S., and Vietnam, covering approximately 95% of the global insurance market.

The World Insurance Report 2013 is based on a comprehensive body of research that includes 114 interviews with senior insurance executives. The Report is available in English and Japanese. For more information, visit www.worldinsurancereport.com.

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World Insurance Report 2013 from Capgemini and Efma

  1. 1. WORLD INSURANCE REPORT 2013
  2. 2. 3 2013 WORLD INSURANCE REPORT CONTENTS TABLE OF CONTENTS 05 Preface 07 CHAPTER 1 Many Non-Life Insurers Continue to See Improvements in Core Underwriting Performance 07 — Introduction 08 — Efficiency-Ratio Model Shows Many Countries Improved Non-Life Claims Ratios in 2011, but Some Were Hit Hard by Catastrophe Claims 10 — Many Insurers Find Acquisition Costs Are Stubbornly High 17 — Conclusion 19 CHAPTER 2 Insurers Globally Have Substantial Room to Deliver More Positive Customer Experience 19 — Introduction 20 — Data on Customer ‘Satisfaction’ Fails to Gauge How Well Insurers Are Really Addressing Key Customer Needs 22 — Capgemini’s Customer Experience Index (CEI) Highlights Gaps Between What Customers Expect, and What Insurers Deliver 23 — CEI Offers More than a Thumbs Up/Down on Insurer Products & Services 26 — Customer Experience in Banking Exceeds that of Insurance Across the Globe 28 — Customers Want a Mix of Traditional and New Networks and Channels 28 — Conclusion 31 CHAPTER 3 To Leverage Integrated Multi-Distribution Strategies, Insurers Need to Invest in Mobile as a Channel 31 — Introduction 32 — Integrated Multi-Distribution Approach Is Key to Customer Acquisition and Retention 34 — Mobile Is Forcing Many Insurers to Retrace Steps on Path to Integrated Multi-Distribution 36 — Investing in Mobile Can Help Insurers Grow Revenue, Enhance Customer Experience, Cut Costs, and Improve Efficiency 39 — Use of Social Media Is Already Widespread in Insurance Marketing, and Will Grow More Extensive Over Time 41 — Conclusion 42 — Case Study: Genialloyd Leverages Social Media to Boost Reputation, Brand, and Sales 43 — Case Study: Customer Insight Into Action (CiiA), a Social Media Analytics Solution 44 Methodology 46 About Us
  3. 3. 5 2013 WORLD INSURANCE REPORT PREFACE Capgemini and Efma are pleased to present the sixth edition of the World Insurance Report (WIR). Insurance companies around the globe have worked diligently since the global financial crisis to reduce operational costs, and improve effectiveness. Those initiatives are now paying dividends, but market conditions remain tough, with few insurers able to raise rates as much as they would like, if at all, and investment income is still lagging. Insurers are nevertheless turning their attention to boosting revenues, and reducing acquisition costs—an expense that has remained stubbornly high. Revenue growth depends heavily on keeping existing customers and attracting new ones, preferably by utilizing low-cost direct-sales channels (Internet and mobile), which reduce the need for costly intermediaries. But direct distribution networks and channels (access points) are not just a boon for insurers; they are increasingly on the must-have list for insurance customers—who expect the same anytime/anywhere/any device service to which they are accustomed in other areas of their lives. This report looks at the channel and other preferences of insurance customers by analyzing data from Capgemini’s Customer Experience Index (CEI), which was developed to provide a granular view of how customers perceive the quality of their service interactions across three dimensions: products, networks/ channels, and customer lifecycle. The CEI is built from data captured through Capgemini’s Voice of the Customer Survey, which queried more than 16,500 customers in 2012 on their general satisfaction with their insurer, and also inquired more specifically about the importance of specific channels for executing different types of transactions, and for different types of products. The CEI showed that channel strategy is a critical part of the customer proposition, and the report examines in more detail how mobile in particular is requiring insurers to take a step back and re-engineer their integrated multi-distribution strategies. The report looks at channel strategies through the prism of Capgemini’s Multi- distribution Model, first introduced in the WIR 2009. More generally, the findings of the WIR 2013 draw on research insights from 41 of the biggest insurance markets in terms of premiums: Argentina, Australia, Austria, Belgium, Brazil, Canada, China, Denmark, France, Germany, Greece, Hong Kong, India, Ireland, Italy, Japan, Lebanon, Malaysia, Mexico, Morocco, the Netherlands, New Zealand, Nigeria, Norway, Philippines, Poland, Portugal, Russia, Saudi Arabia, Singapore, South Africa, South Korea, Spain, Sweden, Switzerland, Taiwan, Turkey, UAE, U.K., U.S., and Vietnam. Included in the research were in-depth focus interviews with 79 insurance executives and responses to an online survey by 35 executives. We are pleased to present you with this year’s World Insurance Report, and hope our findings offer insight into the evolving landscape in which insurers now operate. Preface Jean Lassignardie Global Head of Sales and Marketing Global Financial Services Capgemini Patrick Desmarès Secretary General Efma
  4. 4. 25 2013 WORLD INSURANCE REPORT CHAPTER 2 Figure 2.6 Customers with Positive/Negative Experience by Country (%), 2012 FIGURE 2.1. Customer Satisfaction with Insurers (%), by Country, 2012 Japan South Korea Portugal Switzerland Russia Sweden Denmark China Italy Hong Kong Norway Germany Taiwan Spain Ireland Singapore Netherlands Poland France Austria Belgium Australia U.S. Brazil U.K. India Canada Argentina Mexico South Africa Negative Experience Neutral Experience Positive Experience 42%51%7% 57%5% 59%6% 56%11% 60%8% 53%15% 56%12% 59%9% 53%16% 59%10% 52%19% 63%12% 67%9% 62%16% 68%10% 65%13% 67%12% 70%9% 57%23% 67%13% 73%8% 68%13% 72%9% 66%16% 69%13% 68%14% 60%22% 71%14% 74%12% 70%18% 38% 35% 33% 33% 32% 32% 32% 31% 31% 29% 25% 24% 22% 22% 22% 21% 21% 20% 20% 19% 19% 19% 18% 18% 18% 18% 15% 13% 12% Source: 2012 Insurance Voice of the Customer Survey, Capgemini, 2012 Figure 2.7 Positive Customer Satisfaction vs. Positive Customer Experience in Insurance, 2012 FIGURE 2.7. Positive Customer Satisfaction vs. Positive Customer Experience in Insurance, 2012 0% 20% 40% 60% 80% 0% 20% 40% 60% 80% PercentofInsuranceCustomersRegistering PositiveSatisfaction Percent of Insurance Customers Registering Positive Customer Experience Average Positive Customer Experience (25.2%) Average Positive Satisfaction (63.7%) Japan Hong Kong Taiwan Sweden China Italy Portugal Denmark Singapore Poland Ireland Spain Austria Brazil MexicoU.K. India Argentina South Africa Canada Belgium Australia FranceNorwaySwitzerland Netherlands U.S. Russia Germany South Korea Positive Satisfaction = Positive ExperienceHigher expectations coupled with a prolonged crisis in the financial markets in the past have resulted in customers being neither satisfied nor having a positive experience in Japan None of the countries appear close to achieving a positive experience equal to satisfaction levels for life insurance products Proportion of customers with positive experience was highest in South Africa, though it still lagged much behind proportion of customers with positive satisfaction Source: 2012 Insurance Voice of the Customer Survey, Capgemini, 2012
  5. 5. www.capgemini.com/wir13 www.wir13.com For more information, please contact: Capgemini insurance@capgemini.com Efma wir@efma.com For press inquiries, please contact: Marta Saez (EMEA) at msaez@webershandwick.com or +44 207 067 0524 Cortney Lusignan (North America and Rest of the World) at clusignan@webershandwick.com or +1 212 445 8192 Karine Coutinho (Efma) at karine@efma.com or +33 1 47 42 69 82

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