When insurers apply a deep understanding of consumers and policy holders to their operations, three opportunities to generate revenue emerge.
Most industries are competitive, but few are more so than insurance. With the bundling of products, education – informing consumers that premiums are merely one indicator of value – and catchy branding, today’s insurers have come a long way in creating brand awareness and loyalty.
Even so, the insurance market is marked by razor-thin margins, aggressive competitors and fickle consumers. Here are three ways insurers can increase their profits in such a challenging environment.
- Create a new product: What can you offer to your existing customers that you aren’t already? What new products and plans fulfill an existing need and provide policy holders with added value? Alternatively, how can you reach new customers, in new demographic segments and geographies?
- Optimize product pricing to balance risk and profitability: When engaging price-sensitive consumers, pricing new products too high can quickly diminish demand, while setting them too low immediately increases risk. Sound, strategic, data-generated pricing strategies reflect the optimum balance, one where risk and demand are calibrated in unison. But how do you identify that price point?
- Increase customer satisfaction and lower churn with better apps: Insurers have made tremendous gains to strengthen the user experience, but what app will make your customers’ and prospects’ lives even easier at every point in the process – from selecting the right product or plan, to making a payment or filing a claim? How can you create customer-facing applications that make a real difference?
The answers to all of these questions can be found in the data customers and prospective customers create in their interactions every day; however, this information is often out of reach, expensive to gather, or too difficult to work with because of privacy and legal concerns. Fortunately, with synthetic data, insurers can overcome all of these issues with ease.
Synthetic data: the key to profitability for insurance companies
AI-generated synthetic data is a must-have tool for insurance companies, ready to be leveraged across a wide variety of insurance-specific use cases. Find out how to improve improve pricing and risk predictions, create meaningful and safe test data and be fully compliant with the strictest data privacy laws, like GDPR.