In 2018, you will spend — on average — the equivalent of 11 straight days shopping. Of all the things you’ll buy in that time, which will be the purchases you enjoy the most?
I’m going to go out on a limb here and guess that an insurance policy didn’t spring to mind.
Buying insurance isn’t something most of us enjoy. An estimated 44 percent of Americans think shopping for auto insurance is frustrating and while 40 percent complain that it’s complicated.
The implications of this are more significant than people realize.
For customers, this means they wind up paying more — and sometimes for coverage that doesn’t even match their needs. People stay with the same insurer for way too long — missing out on lower premiums they could otherwise get.
An aversion to insurance shopping also creates the risk of people failing to do their homework on their policies and potentially having inadequate coverage.
But it doesn’t need to be like this. After all most of us actually love shopping. One-third of Americans even say it makes them feel better than working out.
Largely this shopping is for things we don’t even need. Retailers worldwide sell 80 billion items of clothing every year, yet research suggests that we leave as much as 25 percent of our wardrobes unused, collecting dust.
We want to shop because we enjoy it. Smart fashion brands and retailer know that designing gratifying experiences — whether offline or online — taps into this trait and helps businesses grow.
Wants vs Needs
Things couldn’t be more different when it comes to products that we are legally required to buy. Things like insurance.
If you want to drive, auto insurance is virtually mandatory in all 50 states. If you’re applying for a mortgage, you need homeowners insurance. There are even certain dog and cat breeds that require a health insurance policy.
The requirement to buy insurance has relieved the pressure on insurers to create rewarding experiences that entice customers.
This fuels the widespread dissatisfaction and puts a very low ceiling on the love an insurance company can get from consumers.
A commitment to beauty
Shoppers may never love setting our bodily injury liability limits the way we love shopping for a new pair of sneakers or jeans, but something has to be done here.
The insurance industry needs to invest in the thinking that distinguishes great fashion designers; a commitment to making beautiful experiences.
This is a principle that runs through high-end works of art using the human body as a canvas to mainstream retailers shaping everyday life.
Can this approach have an analog in insurance? As a Co-Founder and product lead for an insurance company, my response would be ‘How can it not?’.
What fashion can teach fintech
Prior to starting Cover, I co-founded a high-end fashion e-commerce mobile app called Stylekick. One of the most jarring gaps I found when transitioning into the insurance space was the lack of attention to user-experience.
In the fashion industry, online and offline experiences are designed to create moments of joy. Insurance often ignited the opposite reaction.
Switching to insurtech immediately I found myself asking; why can’t insurance be filled with this same commitment to beauty, to design that makes people happy?
Sure, the opportunities to create joyful moments are vastly different between fashion and insurance shopping experiences. We know that it’s not the insurance product itself that is going to bring people joy at the point of purchase.
So, why not make the process as easy as possible through beautiful design and intuitive tech?
Customers will shop for insurance less often than clothes and (hopefully) use it less often. What this means for us is that we need to make every single touchpoint with our company as pleasurable and stress-free as possible.
Although people may never love their policies the same way they love their wardrobes, insurance companies can do better.
By streamlining the insurance shopping experience into a simple mobile app, Cover takes the pressure off the consumers shoulders and connects them with real people who have their best interests in mind.
By designing for moments of joy, insurance companies can demonstrate a higher degree of care for their consumers. This practice is paramount in the fashion industry, and is largely what leads clothing brands to successfully build long-term, meaningful relationships with customers.
These customers are more likely to become brand champions as they interact more and more with the company.
Why does all this matter?
Nobody said insurance was glamourous and we’re not trying to fool anyone. The least we can do is make the experience of getting a tailored quote that much easier through an intuitive app and friendly sales agents who offer their expertise, patience and a genuine desire to help.
We know from talking to our customers that these ideas work. It’s early days, but our aim is that in the future, customers won’t stay with the same company for years because they hate insurance shopping.
Instead they will stay with the same company because a company that consistently delivers these moments of joy will inspire the loyalty and even love to keep customers long term.
At Cover, we believe the future of property insurance is as a commodity. Product design will play a key role in differentiating one insurance company from the next. It’s down to the product design teams within the new generation of insurtech companies to reshape this process.
