The Question is a new series on the Montoux blog - in each post, we pose a potentially controversial question to prominent members of the life insurance industry, to gather their unique perspectives. Read the previous edition of The Question here.
Today we ask:
How much of the market do you think could be sold to direct if we can overcome tech barriers, and do you believe face-to-face advice would still play a role?
I am not sure if the challenge is a technology issue or if it is the cost to finding the right individuals and then moving them to act. The key to this business is finding healthy individuals and convincing them that having protection is important. Humans are the market proven and most cost-effective way of distributing individual life insurance and I don’t see that changing in the near future. I actually believe the future is a combo of human and AI. Both will exist as standalone models, but the combo of human/AI will win long term.
- Andrew Gordon, VP and Actuary, Life Insurance Product and Risk, Guardian Life
The industry has basic problems with overly complex products, deeply flawed application processes, and generally crappy user experience. Some of these are tech barriers, but the upstream cause is usually cultural or a result of organisational structure or distribution strategy.
In this light, the direct market will grow as slow progress is made in these areas, but there will be an ongoing need for face-to-face (or remote) advice in many cases. And if a person has a complex situation, a face-to-face adviser is often simply a better option, particularly if the adviser is using tech smartly. I don’t have a guess for how this will play out in percentage terms.
- Conor Sligo, Consultant, Sligo Consulting
The tech barrier to solve is how to provide personalised advice in a way that builds trust and engagement. Technology solutions for this are emerging from the digital laboratories. By these, I mean robo-advice solutions and voice-driven personal assistants. Today robo-advice is algorithm based decision structures delivered through answer the question digital interfaces. Tomorrow, robo-advice will be a trusted voice and friendly face ( matched to your demographics' preference) asking questions about your needs, explaining solution options and closing the sale, all using artificial intelligence-driven algorithms. The experience will be delivered on the digital device of your choice, using best adviser models and be based on access to deep data on the needs and underwriting risks of similar individuals. This process will be overseen by an AI engine that ensures compliance obligations are met, optimum upsell and cross-sell strategies follow-on and that data-driven continuous improvement occurs in a disciplined way. Of course, human to human advice will always be available to those happy to pay the extra premium required to support it.
- Sam Knowles, Director, Montoux
If you would like to share your own perspective on this question - or be part of a future post - please contact us.