Week 8 Flashcards
Why are tech companies a problem for insurance?
They can have huge names, money, customers, data and can be very powerful in influence.
What is the phrase which refers to when someone that isn’t and insurance group offers insurance such as getting insurance on a house but not though insurance company but possibly a bank?
Bancassurer
What might 3 insurance competitors be which can challenge their profit and getting customers?
Retailers, bancassurers, online comparison sites and super markets.
What is the percentage approx of customers who want cheap and premium insurance and why may this be a problem?
35% approx want cheap insurance but also additional services with it which costs more. only 1-2% will pay for premium insurance products
How did direct line get advantage?
They were simple and convenient, they were also online and cheap with tele sales, they got a lot of customers and data
The phrase insurance is sold not bought, describe why this is?
Because insurers try to sell their products to customers even though they may not require it as a purchase, people dont want to buy it because it seems complex and grudge paying.
What might insurers consider in market analysis?
Who (Who is the competition), where (where in the market might they sell), What (what are they selling and why)
Suggest one way which insurers decide who they will serve?
Through the use of advertisements insurers can filter who their audience is. (keeps loss ratio lower and premiums lower as they know what to expect).
What are the two types of insurance distribution?
Direct distribution (sold from insurer to customer keeping 100% profit and premium but the risk too)
Intermediary distribution (use a middle man, lowers risk but shares profit and two relationships to handle)
Explain what prospecting funnel is?
It take a lot of suspects to catch a prospect who may become a customer.
What might have a significant impact on expense ratio in insurance?
Marketing and distribution have a significant impact on expense ratio and profitability)
Segmentation means what?
It means to divide policy holders into smaller groups based on their characteristics. Could be used by risk management and claims management to better understand their customers.
What might segmentation allow for insurers?
It will allow insurers to put their resources more efficiently to target specific people/ groups of people
High segmentation will mean what for loss ratios and premiums?
High segmentation should mean low loss ratios and premiums as the resources are target and are more likely in theory to gain more customers/ policyholders
