Through digital technology, the UK insurance giant is rethinking the role it can play in customers' lives

1. 1 © The Economist Intelligence Unit Limited 2016
Through digital technology, the UK insurance giant is rethinking the role it can
play in customers’ lives
The insurance industry has never been associated with cutting-edge technology. The conservative
ethos of this sector is in stark contrast to the self-consciously avant-garde role assumed by
Silicon Valley. So when UK insurance giant Aviva throws its hat into the digital ring with gusto, it is
a sign that something significant is afoot.
As the company’s chief digital officer, Andrew Brem, indicates, Aviva is not just trying to implement a
digital strategy—it is changing the way in which an insurance company sees itself. “From a digital point
of view, the insurance industry is years behind other consumer industries. Our customers are highly
digital in the rest of their lives, but when they turn to financial services, they see a sector that is ten
years behind retail and e-commerce.”
Indeed, he says, for inspiration Aviva is looking towards retailers such as the UK’s Argos, which has
integrated online, telephone and text communications as well as physical stores.
It may traditionally have been a conservative industry, but insurers have plenty of what many consider
to be the core ingredient of any digital initiative: data. Mr Brem wants the insurance industry to look at
data as a resource to be exploited.
“I am astounded by the amount of proprietary data we have but do not use,” he says. Specifically,
the company holds a lot of information about the lives of its customers that might not normally be
accessible to them.
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An article from the Economist Intelligence Unit
SHIFTING MINDSET

2. 2 © The Economist Intelligence Unit Limited 2016
“People are interested in data about themselves,” Mr Brem explains. “We know a lot about every
property, about threats such as flood risk, subsidence or burglary. My idea is to expose all of this to the
consumer. Consumers are surprisingly interested in that kind of data.”
He sees these data as the catalyst for changing Aviva’s relationship with its customers, by which he
means encouraging clients to see insurance itself in a more dynamic and, frankly, a more interesting
light.
Working in The Garage
As he speaks, Mr Brem is walking around London’s Hoxton Square, using an app on his mobile phone to
count the number of steps he takes in a day. This is just the kind of information that could be linked to
an insurance product, thereby allowing Aviva to offer fit and healthy clients a lower premium.
Hoxton is a fashionable London district favoured by technology start-ups. It is here that Aviva has
chosen to locate The Garage, a digital hub that encourages collaboration between Aviva’s commercial
arm and web designers more used to creating trendy apps than online insurance policies.
The Garage is a space that allows Aviva to think differently from its usual corporate environments, Mr
Brem explains. “It feels totally different from other insurance offices, it is more like a school science
laboratory where we can learn from things that do not work. The approach is to motivate people there,
to be creative.”
That creative thinking has a well-defined business objective: deepening Aviva’s customer relationships.
Insurance is a distress purchase and customers usually only interact with their providers once things
have gone wrong. That is hardly the occasion to start cross-selling other products. Mr Brem wants to
Aviva to engage with its customers before they have a reason to claim against their policy. This requires
a much closer relationship with the client base than insurance companies have enjoyed in the past, but
the advent of a digital world makes it possible and affordable.
The main vehicle for this closer relationship is the company’s MyAviva portal. The core purpose of the
portal is to show customers all of their car, home and medical insurance policies in one place, and from
any device. But the company is exploring ways to make the portal more useful and more engaging. For
example, stories about the premiership rugby fixtures that Aviva sponsors are published there, in the
hope of making the experience more entertaining.
Taking a cue from the popular and opinionated TripAdvisor travel website, Aviva has also created an
online review forum, where customers are invited to discuss the company’s products and services.
The attraction for contributors is that frank and critical opinions are encouraged. Aviva hopes that by
opening itself up to critical voices it can establish an open relationship with its customer base.
Not unusually, many of Mr Brem’s digital experiments are developed with an eye to improving his
company’s engagement with millennials, who present insurers with a specific problem. “They do not
think about protecting their belongings or saving for the future,” he explains. “But we can use digital
to create businesses aimed at them.”
Inside Aviva’s shifting mindset

3. 3 © The Economist Intelligence Unit Limited 2016
This may involve entirely new routes to market. In China, for example, insurance is sold via social
media, Mr Brem notes, and consumers have been known to buy insurance as a gift. This is proof, he
adds, that entirely different perspectives on insurance products can be fostered by digital innovation.
So far, the most tangible manifestation of Aviva’s new digital thinking is AvivaDrive. This is an app that
uses a smartphone’s GPS location-tracking function to measure acceleration, braking and cornering to
create an individual driver profile. A proportion of users get a discount—up to 20% on car insurance for
those who score highly as safe drivers.
AvivaDrive is part of the “Nudge” philosophy of using small incentives to encourage desired behaviour,
in this case better driving, Mr Brem says. AvivaDrive has been downloaded 500,000 times in 18 months.
This initiative reveals a shift in the insurer’s mindset, from simply aggregating risk across its
customers’ policies to actively influencing customer behaviour. That shift is yet another testament to
the significance that digital technology has to the insurance sector.
Inside Aviva’s shifting mindset