In the first part of this series, I looked at the market opportunity defined by voice technologies — providing a deep-dive into Amazon and its Alexa ecosystem. What really excites me about the possibilities of voice interfaces is the opportunity to create, implement and sustain credible use cases that extend beyond information-bearing capabilities. In other words a skill that reduces friction and simplifies the customer experience.
“Digitization is a revolutionary force and it will not spare the insurance industry. I’m pretty sure the industry will not survive in its current form.” — Stefan Knoll, Deutsche Familienversicherung CEO
- United Kingdom
- United States
The link above provides a comprehensive summary of the skills offered. Their function, associated commands, the number of reviews received and Amazon rating within their respective markets. These factors were monitored and tracked for changes and developments over a six-month period.
While insurers are quick to publicise their entry into the skills marketplace, I question whether these initiatives are simple marketing ploys or if they constructively enhance the customer experience.
Zombie skills are a real problem. As a refresher from the first part of the series, these skills are accessible but not heavily used or appreciated. Naturally, consumers want an insurance partner that is hassle-free, hence the rise of InsurTech. You probably ask, how a voice platform can help achieve the above? In other words, why would a consumer proactively seek out insurance-based skills and choose to interact with them? After all, there are 50 000+ skills on the Alexa platform currently.
The UK market currently has twelve active skills in the insurance space, which remains unchanged over the past six months. Of these, the primary function is information-bearing only. In other words, there is no account linking to provide personally tailored voice experiences on behalf of consumers. Instead, skills are at the basic level of answering brand/company-specific questions and deciphering insurance jargon.
Using customer reviews as a proxy for engagement, it is clear that Aviva is the market leader (twenty-three collective reviews versus DAS Development, its nearest competitor). Aviva was quick to enter the market, developing and launching its self-named Aviva skill over a twelve-week period. However, as a simple jargon-based tool it had failed to meet consumer expectations by not providing personal policy details and/or contextual services. In other words, it was hyperlocal voice-based search tool.
Since then, market rumours gave me room to believe that Aviva was ready to respond to suggested feedback. It launched the Aviva Pension skill in August of this year, replacing its previous self-made offering. Aviva 2.0 immediately took advantage of account linking, providing contextual pension policy information to users. While limited to specific pension policies only, it is believed that consumers want more — A centralised hub for all Aviva policies.
On the contrary, Vitality made a strong push this summer to promote its self-titled skill, encouraging non-Vitality members to sign-up by gifting them with an Amazon Echo Dot. Personally, I never felt that their fitness and nutrition tips skill is an enticing proposition, and fail to see how this would resonate with people over the long-run (if anything). At one point I believed that this was their soft entry into the voice space, with a long-term view of using the Alexa as a base-case for customer interaction. However, it is clear from part one that despite analyst expectations, this is a long way out.
The US market currently has twenty-eight active skills in the insurance space. What differs here, is that the range and depth of services across the US market outperforms the UK — Receive personalised policy information, track your claims, compare and obtain quotes, locate an insurance agent, ask questions, receive advice and even request an emailed soft-copy of your insurance policy (skill-dependant).
Perhaps there is market-bias, where first-mover advantage has given insurers time to refine their value propositions, but I don’t buy this viewpoint. In fact, the origins of the very first insurance-focused Alexa skill dates back to 2016, when US insurer Liberty Mutual launched its self-titled skill for Liberty Mutual and Safeco users (today, both brands have separate skills) — a time when Amazon had ~3 000 skills on its platform. The skill could provide an estimated auto insurance quote as well as advice on commonly asked auto and property insurance-related questions.
What is interesting, is that despite this information being made publicly accessible; UK insurers are behind the curve. They have failed to replicate a value proposition of the same level. Either they (a) have purposefully toned-down investment on the back of waiting for the market and technology to mature or (b) are less engaged with voice technologies and the opportunities at play.
My instincts would suggest option (a).
Irrespective, there is clearly an opportunity for UK insurers to relook at their current skills on offer, and make changes. For starters, there is an untapped opportunity with account linking (only Aviva has made strides in this regard), but let’s wait and see…
Germany is leading the pack on the insurance-based skill front. With fifteen skills in the space, majority of large market players are directly involved. Remember, you can see a full breakdown of the current skills offered by insurers here.
Approximately 50% of German consumers envision completing the end-to-end insurance process using voice technologies. As the first German insurer to launch an Alexa skill, Deutsche Familienversicherung have now collaborated with Amazon and Amazon Pay (newly-introduced integration) to become the first German insurer to allow customers to seamlessly purchase and conclude insurance contracts digitally.
They have began their rollout with foreign travel health insurance and look to expand to liability insurance before diversifying into health and property. This level of Alexa integration is something I’ve been predicating for as the catalyst for real, sustainable engagement.
While Deutsche Familienversicherung has set global precedent, they expect pushback from market players and regulators. Why? The EU beefed up its consumer protection guidelines in February 2018, increasing insurer’s responsibilities around ensuring clients are properly informed. Hence, Allianz and Zurich have explicitly stated that all communication data is only transmitted and processed via the Amazon server and not through a third-party. Perhaps stringent regulations have increased levels of reluctance (or apprehensiveness) across competing peers?
Who knows, but all I can say is kudos to them for putting themselves out there and developing a skill that truly encapsulates the full potential of voice technologies.
The awkward use and structure of language makes it clear that dialog improvements are key to developing this nascent space. Despite this, Deutsche Familienversicherung has proven what can be done. I believe the UK and US markets have some catching-up to do. If this is achieved, it can fundamentally change the insurance landscape — For better or for worse, that’s for you to decide. It’s happening in other skill verticals, and if we follow this trajectory then we may see an opportunity for an entire ecosystem of financially-based transactional and interactive skills. Skills that provide contextual and personalised customer value.
Are we too far away from this? Only time will tell.
If you or your network is passionate about the space, and would like to learn more, please feel free to reach out.