Online games may point to future for insurance industry
Gamification of insurance could see the transformation of the industry across many verticals, including car and life insurance, by increasing customer loyalty, engagement and personalisation. Telematics, for example, will reward safe drivers with cheaper "usage-based insurance" and customers who achieve wellness goals measured by wearable fitness devices can receive benefits such as vouchers, cash incentives and reduced health and life insurance premiums. However, insurers must be mindful to keep communication relevant, targeted and consistent and base gamification on core business goals that offer customers useful services.
Gamification has helped insurers better fulfill the needs of their customers and move away from conventional enterprise communications, and towards personalized, engaging interactions, but insurers must keep sight of its business purpose.

(Image credit: Adobe Stock.)

Achieving customer engagement isn’t easy in a sector like insurance. No matter how important it is to safeguard your home, vehicle or cellphone, filling out a static form just doesn’t have the same appeal as immersing yourself in the latest augmented reality game, such as Pokémon Go.

But that is starting to change. Insurers are becoming aware of the need to keep pace with the disruptive developments sweeping other areas of the finance industry, such as Mastercard’s ‘selfie pay’ and Capital One’s voice recognition, and modernize customer communications. In fact, nearly 90 percent of insurers agree that they need to embrace innovation or risk losing market their share to more agile competitors.

So, what digital approach can the insurance industry adopt in a bid to update everyday services and recapture customer attention? One answer is gamification—the process of applying game features and design techniques to motivate individuals towards certain goals. In other words, a means of creating engagement in a traditionally uninspiring experience.

Paving the Way to Digital-Savvy, Customer-Centric Insurance

By implementing sleek templates and elements like point scoring and rewards, insurers hope to meet rising demand for interactive, cross-channel, and real-time communications—thereby driving greater customer loyalty and engagement. And when coupled with advances in cloud-based technology, it seems gamification could pave the way to a revamped, digitally savvy, customer-centric era of insurance.

What then, do game-focused insurance interactions look like?

Fair Isaac Corporation (FICO), for instance, most commonly known for providing the credit scores that determine how much auto insurers charge drivers, announced last year that it was creating smart algorithms to rate driving ability. This year the company is collaborating with eDriving’s Mentor app to assess teenage drivers by tracking their braking, cornering, acceleration, and speeding — and how they respond to the in-app training. At the end of the process, drivers will receive an overall score defining their level of risk, as well as advice about how it can be improved.

The move comes as part of the wider auto insurance focus on telematics — where driver behavior is monitored using in-car dongles and safe drivers are rewarded with cheaper ‘usage-based insurance.’ It’s likely that with 70 percent of US auto policies due to be based on telematics by 2020, the FICO driver score will provide invaluable insight for deal-hungry drivers and insurers hoping to encourage better driving practice.

Not Just for P&C

But gamification isn’t restricted to automotive insurance; it’s transforming life insurance too. Since John Hancock become the first provider to offer customers discounts in return for sharing data from Fitbit exercise trackers, its mission to “reinvent the consumer life insurance experience” has fuelled a boom in policies focused on health-tech. Cigna, Humana, and UnitedHealthCare are just a few of the insurers now providing benefits—such as vouchers, cash incentives, and reduced rates—if customers hit set goals in wellness programs by logging activity with wearable fitness devices.

Through these incentivized policies and plans, insurers are leveraging gamification to reinvigorate their communications and turn interactions perceived as dull—such as policy renewals, claims, and applications—into engaging conversations. In doing so, they are not only capturing the attention of generations previously unenthused by insurance, particularly millennials, but also improving the quality of customer service.

But it’s vital to note that however well-designed gamified insurance experiences are, a shiny exterior will not disguise poor engineering behind the scenes: if messages are not accurate and personalized, they’re unlikely to make the right impact. As a result, it is essential for insurers—and fintech companies—to use the principles that drive their broader communications strategy as the basis for their gamification approach:

Harness the power of data: Customers expect every interaction to be unique and personal, which makes it crucial for businesses to ensure accurate insight is the foundation of all experiences, including gamified ones. If insurers want to make a connection, messages must be relevant, targeted, and consistent.

Play shouldn’t overtake business needs: Providing an interactive experience in customer communications is important to keep user interest, but it’s not everything. Gamification must be about more than providing an unusual experience or an attractive interface; it should also be driven by core businesses goals and designed to deliver genuinely useful services for customers. Games that look great but offer no substance or fail to render on different devices will quickly lose their appeal.

Take usability into account: Today’s customers have a high level of digital ability but they are time-pressed, which means lengthy and complex gaming experiences aren’t likely to find favor with them. Insurers need to make sure document templates are well designed and sophisticated, yet clear and simple, with interesting data points boiled down into easily-digestible charts.

Long considered as a necessary but unexciting aspect of the finance world, insurance is at last beginning to lose its old-fashioned reputation. Gamification has helped insurers better fulfill the needs of their customers and move away from conventional enterprise communications, and towards personalized, engaging interactions. But as more insurers are enticed by the concept of play, it is essential they keep sight of what matters most: developing lasting connections with customers through precise, tailored communications, and not getting lost in the game.