Apr 16, 2021

Clearcover lowers car insurance premiums through digital

Clearcover
carinsurance
Digital
paypermile
William Girling
2 min
‘Smarter’ car insurance company Clearcover has raised US$200m in its latest Series D funding round
‘Smarter’ car insurance company Clearcover has raised US$200m in its latest Series D funding round...

Clearcover is a Chicago-based insurer that specialises in automating traditionally manually-driven processes. The resultant savings are then passed onto policyholders in the form of cheaper premiums.

In many ways, the company is tapping into a prevalent industry trend that COVID-19 accelerated in 2020, namely the greater adoption of digital tech.

The leader of Clearcover’s Series D round, Eldridge, views its value proposition as being a tonic for legacy processes that are impacting insurance’s evolution:

"Clearcover’s technology-first platform offers customers a fast, affordable alternative to legacy auto insurance. As the industry continues to evolve from analogue to digital, Clearcover is well-positioned to scale while delivering a competitive product and better experience to consumers across the US,” said Todd Boehly, Chairman and CEO.

Changing car insurance CX

So far, Clearcover has managed to generate $329m in funding and netted support from investors such as American Family Ventures, Cox Enterprises, and OMERS Ventures

The quality and quantity of investment underscore the car insurance sector’s latent development, which has generally sprung from the necessity to evolve following reduced car usage during the pandemic. 

“The car insurance experience is becoming increasingly digital and customers want streamlined, customizable options when choosing a carrier,” commented Kyle Nakatsuji, Co-Founder and CEO of Clearcover. 

“In an industry ripe for transformation, we see ourselves as innovators in digital car insurance experiences while providing our customers more value for less money. This new capital will allow us to continue our growth across the country, providing better insurance to more customers.”

Other companies like RAC, Metromile and By Bits are capitalising on new customer expectations by providing ‘pay per mile’ policies, often a cheaper and more flexible alternative to conventional insurance.

All of these developments indicate that modern car insurance CX should prioritise personalisation where possible, and that digital technology is often the best route to cheaper products that don’t sacrifice quality. 

Image source: Clearcover

Share article

Jun 20, 2021

4 ways to digitally enhance an insurtech customer experience

Insurtech
customerexperience
DigitalTransformation
Customercentricity
Stephanie N. Blahut, co-founde...
5 min
Stephanie N. Blahut, co-founder of B2Z Insurance, explains how insurtechs can build relationships with customers through data-driven innovation

Insurtechs run the risk of cannibalising their own mission to boost coverage by getting sidetracked focusing on the latest and greatest technology.

These folks may advertise an end-to-end digital experience, but behind their slick customer-facing portals, they struggle to overcome the same problems that established insurers still face: a broken customer experience.

If an insurtech platform delivers a digitised version of a broken process, shoppers may be deterred by the same pain points that they were hoping to avoid by going with the more modern insurer. This might mean that shoppers are required to fill out a series of confusing forms that don’t apply to their industry or even be required to pick up the phone and wait in a queue to secure the quote they got online. Spoiler: neither experience leads to conversions.

As the Chief Marketing Officer and company co-founderI’m a fervent advocate for putting small business owners and their customer experience (CX) at the center of insurtech product design. At B2Z, we provide digital, self-driven business insurance to small business owners by amassing digital intelligence through vast amounts of data, then leveraging it to streamline their insurance experience. That’s because our audience doesn’t have time to pick up the phone and wait to talk to an agent or chase emails over days or weeks waiting for a coverage decision.

1. Excel where others fall short

To understand where you can improve your CX, start by auditing the current insurance experience for potential customers in your target market. By identifying the common touchpoints and locations along the customer journey where the competition falls short, you can also find opportunities to pull ahead.

At B2Z, we found that most policy offerings were cumbersome and incomplete, but there were two major pain points we saw time and again:

  • Irrelevant questions led shoppers to question whether they were applying for the right product. Small business owners could receive a quote after answering questions in an online form, but the process wasn’t tailored to their business. For example, pet retailers would be asked about liquor sales at their establishment.
  • Shoppers couldn’t complete the process entirely online. Even after they were promised a completely digital experience, too many small business owners were required to follow up over the phone to secure coverage.

Why are these such serious issues? Small business owners are busy people. More than 70% of them work more than 40 hours per week as they fill a variety of different roles across their organizations.

This disjointed process left busy entrepreneurs with coverage gaps or uninsured altogether: over 70% of small businesses are underinsured, and 40 percent aren’t insured at all. And having the right kind of insurance can be the difference between a business shutting its doors or enduring. This landscape created an opportunity for thoughtful technology to improve the customer experience.

2. Use technology to solve pain points

In the property and casualty space, insurtechs can shrink expense ratios to almost 40% lower than those of traditional insurers. But they don’t do this by implementing technology for technology’s sake. Instead, they identify and target specific areas where tech can improve the customer experience and they strategically design the right solution for their customers’ needs.

Our work with chatbot design is a great example of how insurtechs can leverage innovative tech to differentiate their products and services.

Most insurtech chatbots are equipped to answer simple, formulaic questions you’d find in the FAQ section of their website. While this type of bot helps shoppers and customers access the right information at the right time, their limited natural language processing capabilities too often means customers must input the exact keywords to get a helpful response.

After examining where other chatbots fell short, B2Z developed Diya, a digital guide to small business insurance. During the application process, Diya chimes in at potentially challenging moments to ensure small business owners quickly secure the right coverage. 

For example, when asked to select their business classification code, customers can type, “I cut hair” and select from relevant codes for barbershops or beauty salons.

By being purposeful about implementing new technologies, insurtechs can streamline the customer experience and differentiate themselves from others in the space.

3. Align your CX with customer expectations

The pressure is on for insurtechs to match the digital experience customers now expect when they shop for groceries or refill their prescriptions.

The COVID-19 pandemic changed behaviors and accelerated customer expectations for entirely digital experiences (which have existed since at least 2015). In the US, 73% of customers have tried new shopping behaviours since June 2020 and over 75% intend to continue them. 

To achieve this, insurtechs must leverage data to streamline the customer experience. At B2Z, we leverage our digital intelligence to help small businesses quickly identify the right coverage options based on the risks within their industry.

For example, to gauge the right level of coverage for a contractor, we need to know whether their employees regularly work on platforms more than 15 feet off the ground. Rather than asking the business owner to provide this information, we leverage third-party data, and our algorithms review county records of similar businesses.

Then, by collating this information with millions of other contractors across the country, we can automatically match their business up to an existing model from an underwriting perspective. This leaves the customer with fewer questions to answer manually, streamlining the customer experience and shortening the application process to as little as five minutes.

By drawing from all available data sources, insurers can deliver a speedy, fully digital customer experience while holistically evaluating customer risks.

4. Every digital touchpoint is an opportunity to enhance the customer experience 

As insurers rush to adopt new technology, incumbents and insurtechs don’t consider how their decisions will impact the customer experience.

By taking stock of the competition, implementing new tools that are designed for a specific purpose, and using data to gauge customer expectations (and design to meet them), you can keep your customers at the centre of an increasingly digital experience.

 

About the author: Stephanie N. Blahut is CMO and Co-Founder at B2Z Insurance. B2Z Insurance is a new small business insurance company that provides coverage for on-the-go business owners: simple explanations, easy application, digital quotes, and mobile claims. Stephanie is a seasoned digital marketing professional whose experience spans the insurance, publishing, and software industries. As B2Z’s CMO she leads their digital-first customer acquisition and marketing strategy.

 

Share article