How digitalization is changing the banking and insurance sector: Reducing bounce rates with digital solutions
New normal in banking and insurance
The way we live, work and do business is being fundamentally influenced by digitalization. The impact is particularly noticeable in industries that have undergone or are still undergoing significant change. The banking and insurance sectors are among those that are being significantly reshaped by digitalization. Given the many benefits that arise from new digital processes, some challenges can affect businesses and customer satisfaction. In this article, you will learn how you can use software solutions to make the digital transformation positive for your sector and your customers.
Benefits for finance and insurance companies from digital transformation
Providing constant availability
Digitalization has entered all areas of life. Customers therefore also expect a digital interface with their finance and insurance provider. There is unprecedented flexibility and control that customers demand: constant access to manage their financial and insurance affairs. At the same time for financial institutions and insurance providers, this means they must map the customer’s demand online to keep up with expectations and competitors.
Digitalization enables finance and insurance companies to provide customers and policyholders with a seamless 24/7 online service. Access to accounts and contract management is possible at any time. This meets the demands of today’s digital customer and increases customer satisfaction and loyalty. This leads to further advantages: institutions maintain their competitiveness in the highly digitalized market. It also automates and streamlines processes, increasing efficiency and significantly reducing costs.
Reducing high bounce rates on self-service channels
On the one hand, self-service channels give customers more autonomy, but on the other hand they also lead to customers leaving the online self-service channel for particularly complex topics if they do not understand the content or technical paths. This favors an increase in so-called bounce rates. Similarly, the enormous amount of rules, regulations and offerings can seem opaque to customers, and there is a concern that they may not be able to fully understand the facts and possibly not choose the best option for themselves. At this point at the latest, clients want a personal discussion and a competent and reliable advisor who takes up the client’s interests and serves them with the best possible offers.
By integrating a suitable software solution at the digital Point of Sale, advisors can catch unsettled customers and support them with tailored advice. In this way, the customer feels that their concerns have been understood and that they are receiving the right solution to help them make a decision. Customers who were previously inclined to leave the website due to the flood of information and uncertainty can have a live online consultation with an agent at this point – bounce rates are significantly reduced in this way.
Improve data security
The data required to process and deliver offers and contracts is particularly sensitive. One in five customers fear that their data will not be adequately protected (Hühne, 2021). In the European Union, for example, there are legal regulations to protect this data, such as the GDPR (General Data Protection Regulation), the basic data protection regulation for the protection of personal data, or the PSD2 (Payment Services Directive2), a directive for the regulation of payment services. The secure management of this data has become a challenge for the industries. Because with the digitalization of financial and insurance services, the regulations have also grown and become more complex, especially in an international context.
The use of modern software solutions provides banks and insurance companies with automated support in verifiably complying with legal regulations on data security and data protection. As the number of digital products and services has grown, so have consumers’ concerns about data privacy. By communicating more prominently and transparently about how customer or policy data is handled and protected, financial and insurance institutions can eliminate uncertainty and strengthen customer trust.
Maximize digital skillsets of advisors
At the same time, ensuring data security should not compromise the digital customer experience. Coping with the accumulated requirements makes digital skills necessary. This way, advisors can optimally adapt and adjust to customer needs even in the new environment.
Intuitive software solutions support users in quickly familiarizing themselves with digital processes in their daily work. An investment in digital training also increases employees’ confidence in using digital tools and thus contributes to improving the quality of advice. At the same time, customer satisfaction and loyalty increase.
Financial and Insurance Institutions: Successful with Digital Solutions
Digitalization has challenged all industries. Particularly in the consulting-intensive business of the finance and insurance industry, which thrives primarily on personal consulting, a rapid rethink was required. Meeting the desire for more independence and autonomy of the new, digital customer and at the same time being able to offer high quality and personal advice is still the big challenge here. “Online live consulting at the virtual Point of Sale significantly reduces bounce rates and increases customer satisfaction as well as the closing rate.” emphasizes Karl Heinz Metzger, Head of Partner Business at SYNCPILOT – a software company for digital solutions in the financial and insurance industry.
Sources:
https://www.bundesbank.de/de/aufgaben/unbarer-zahlungsverkehr/psd2/psd2-775434
https://gdpr.eu/
Hühne, P. (2021, 24 Mai). Trotz Pandemie: Deutsche Verbraucher bleiben Europas Online-Muffel. McKinsey & Company