Now I’m going to ask a question because it’s always been asked without even thinking about it: Why do application processes take so incredibly long online? I took the time and the stopwatch to look at the industries of
- Telecommunications
- Automotive
- Insurance
industries. My conclusion: everything could be done faster. I feel like the white rabbit from “Alice in Wonderland” who never has time because everything takes him too long.
By the way, I created the picture with the AI tool “Midjourney”.
The Americans are faster than us
And off we go: I calculate the premium for homeowners insurance online. Regardless of the insurance company, it takes me just under 7 minutes. Everything from roof coverings and solar systems to underfloor heating is queried. With an American insurance company that sounds so delightfully like a thirst quencher, my stopwatch shows a slim 70 seconds and I already have my insurance for my house. No annoying and time-consuming questions.
My other comparison: the automotive industry. I configure a small SUV, made in northern Germany, with normal equipment and 18 tough steps. In the end, it takes me almost 6 minutes. By the way, if I want to take it to the extreme, I have almost 1,200 possibilities of configuring. It’s a different story with the best-known e-car from the USA. And here I ask myself whether everything has to be personalized or whether flat-rate offers don’t have more advantages? Model, color inside and out, rims and autopilot. That`s it! It didn’t even take me a minute.
The U.S. manufacturer is running away from the heart of the German economy. At least in terms of customer guidance and simplicity. In no time at all, I can order a new e-car and enjoy a relaxing coffee with my wife. Quality time! And while German manufacturers are still discussing with politicians who is responsible for the charging infrastructure, the U.S. company is building dozens of pillars in Germany every day. Here, too, they have thought things through. The charging station recognizes the vehicle automatically and simply charges the costs for charging to the account stored, while we have to enter the payment data again each time.
There is another way…
If you want to. Telecommunications has long since understood this. I managed to pick out a new cell phone contract in 40 seconds. Note: The monthly costs for a cell phone contract and an insurance policy are comparable.
Even the international insurances (see example above) are uncomplicated to apply for online. Why do insurers in the U.S. still manage to offer a competitive price-performance ratio with a customer-friendly short application process? By the way, we don’t have to travel that far. Just a few kilometers north, we see that other countries have already fully embraced digitization.
We’re lagging behind and getting lost in ever more complexity because of all the rigidity and regulations.
And when we finally see light at the end of the tunnel, we build another piece of tunnel on top of it.
Why doesn’t the insurance industry manage to make application processes easier in the age of digitalization – when we have access to so much data, which customers are happy to share, by the way? People always say that you need a lot of information, otherwise you can’t make a reasonable price. And then it gets more expensive. Is that really the case, or are people trapped in their own system? Do I really have to know everything about a car insurance policy (including the question of parking space, etc.) just to be able to reduce the price by another 10 cents?
Many people use comparison portals to compare the large number of insurance companies. Regarding the number of questions to be able to display a result, the portal must follow the company that asks the most questions, if it also wants to offer them. If two companies also ask different questions, both questions must be asked in order to do justice to each.
My conclusion:
Until now, I thought that customers were into individuality. With insurance? Far from it. Apparently they don’t! Shower, but don’t wet – insuring yes, but please don’t spend any longer on it than absolutely necessary. Details? Doesn’t matter! – The main thing is to get the damage compensated if something happens! Price: In any case favorable.
What good is the best protection and the cheapest product if the customer gives up after the umpteenth question.
Again, “time is money!”
As for my challenge on how to change something in the insurance system, and referring to an opinion of my friends: Too complicated! – we are still without a concrete solution.
It’s not enough to say, “The questions are too complicated,” or “It takes too long. “Why are the questions too complicated? Why are there so many questions? How could it be shortened without customers having to pay more for it?
Why are there actually contract terms that feel like a small town phone book in terms of quantity? Why do you need a law degree summa cum laude to understand contract terms?
By the way, in the following articles I will shed light on the role played by consumer protectors, EU legislation, rating or analysis houses, product developers, marketing departments and others.
I am still only at the beginning and just scratching the surface.
To be continued.
Contact Karl_
karl.grandl@zero-insurance.com
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