Design Thinking for Digital Insurance Products
Insurance products must become more predictive. The ability to innovate upon digital technologies like predictive analytics and IoT will depend upon design thinking — which focuses on what end-users want, rather than internal process efficiency alone.
Digitization, business model disruption, mobile technology, and process automation are some of the trends industries have adapted across. Advances in artificial intelligence, sensor technology, robotics, and automation are shaping the future of insurance today. Due to complexity in sales, new business processing transactions, and the long-term nature of the policyholder-insurer relationship — digitization of insurance has been a gradual shift.
But now, flexible, agile, and experimental offerings are defining the success of insurance products. To do so, mapping consumer needs and employing limitless creativity to reimagine any product is needed. Innovation begins with empathy for the consumer and then looks to match well-designed solutions to the problems or needs of consumers.
The design thinking approach for insurance
This customer-centric innovation is shaped by design thinking — a method of creative action used to solve complicated problems that can satisfy complex needs, and generate desirable solutions for customers.
Design thinking is a method for solving problems through practical and creative solutions. It is a solution-focused thinking with the intent of producing a constructive future result. It has developed as an approach to resolve issues for creators of advanced tech products and services. But it extends to the services, experiences, and ecosystems that surround these products and services.
A meaningful design thinking strategy employs finding, testing, using, learning, and building at pace, for developing digital insurance products.
01 User experience is human-experience
It takes continuous and thoughtful effort to provide a strong experience. This is because the customer experience in the digital marketplace is different. At a very fundamental level, companies need to make the effort to understand their customers’ physical and emotional needs. What is meaningful to them?
This supplies unique client insights, which provide the basic building block of design thinking. In order to create meaningful innovations, empathy is the centerpiece of a human-centered design process. Direct alliance with digital platforms, distribution channels, and policyholders can unlock a host of client insights.
Defining the customer and identifying the problem that the product is trying to solve will differ for players across the value chain. A realistic vision of how clients will want to conduct insurance transactions, determines which UX strategies need to be deployed. The tactical initiatives that support each of these UX enabling strategies, includes developing the capabilities and resources needed.
02 Eliminate, automate, optimize
The expansion of the IoT illustrates the changing nature of the claims ecosystem, as well as how data from non-traditional sources is transforming insurance operations. Eliminate what can be eliminated, automate which can’t be eliminated, and optimize that can’t be automated.
The design-thinking, customer-centric approach enables insurers to look at and monitor potential risks, and eliminate some risks from materializing. In instances where it is not possible to completely eliminate the risk, the impact can be minimized. Automate, for the most efficient way of settlement and claims. Optimization follows what cannot be automated, making claims efforts more predictive and preventive.
For instance, Roadzen’s first notice of lost (FNOL) solutions can automatically pick up most of the necessary information needed, allow consumers to easily take and upload pictures of the damage from the scene, and even annotate them with notes and necessary identifiers automating the steps involved in claims submission to simple clicks. This reduces the data errors associated with traditional claims applications, and can support bringing together a partner ecosystem.
03 Bring products alive
To create innovative products, insurance companies can’t keep adding elements simply because their competitors do. This results in solutions that are identical and too complex or peripheral, resulting in meaningless value propositions for customers.
Looking beyond the traditional barriers of the insurance sector is critical for producing differentiated products and services. It requires an action-oriented approach with healthy defiance of and non-conformity to traditional constraints.
A design thinking focus allows companies to create offerings that truly revolve around the end user’s participation to create a truly superior experience. This creates recognition for consumers, indicators for brand, price, and quality. It creates products with better performance, and enhances product usage by making them simpler and appealing to use.
04 Deliver pioneering innovation
The output of the design process should be — the problem solved, a client need met, and a largely improved product. But In today’s digital economy, the bar is set much higher and the expectations are far greater.
It’s not just about providing good insurance products and customer experiences, but about having customized policies on demand and specific to the daily risks that customers face.
Hence, delivering true innovation means setting and following the early steps involved in the design thinking process by first defining the problem. Then mapping the challenge. Followed by deeply understanding the core problem, which will be critical to solving and discovering the solution. And finally, creating a breakthrough value proposition, which is not just about being incrementally better, but about making a real difference.