Oliver Werneyer is the CEO and Co-Founder of Imburse, a cloud-based payments integration platform. Oliver was interviewed by Michael Fiedel, a Managing Director at InsurTech Ohio and Co-Founder at PolicyFly, Inc.
Oliver, what do insurance companies in general need to do better around payments?
“It’s important for insurance companies to build a rapport and to create frequent interactions with their customers. Insurance policies are often bought, not sold. Customers buy insurance because they have to, not because they want to, and they most often interact with insurers in difficult situations when making a claim for something that went wrong. This means that insurers need to work even harder to build more meaningful connections with customers, so they can see the value of their policy throughout the entire lifecycle of the policy. It’s important that customers feel like they can trust the insurer to be there when they need them, and that they have a positive view on their insurer and policy.
As an example, insurers could do everything that they're required to do legally, and the customer could still be left unimpressed. For instance, imagine you have an insurance policy that covers car repairs and replacements, as well as the cost of renting another car while yours is being fixed if you get into an accident. Now, you get into an accident, and your car is damaged beyond repair. Here comes the moment of truth. You have a difficult time getting a hold of somebody at the insurance company. Eventually, you get through, and then they tell you to find your own rental car, pay for it yourself and claim the costs back later. It might take two months for the policyholder to get their money back.
Technically, the money for the car rental was paid back, the car was paid off and the insurer can say they did and paid for what they promised they would. But, they did it in such a way that the customer didn’t see any value in the interaction and/or wasn’t satisfied with the service. Insurers need to do better in that moment of truth to live up to the customer's expectations.”
How are consumer expectations born outside the industry, putting greater pressure on insurers?
“Insurers often neglect to understand that consumers have countless interactions with different companies that then shape what they believe is a good customer experience. It isn’t enough to map out what you do relative to other insurers, as customer expectations are not shaped by insurer customer journeys only. These expectations are shaped by other services that customers deal with on a daily basis, such as media and eCommerce. These industries are committed to the digital space and offer them seamless journeys, supported by advanced technology and customer support. Customers end up expecting the same level of seamlessness and innovation from other industries, insurance included.
Every customer touchpoint should be taken into consideration, from the moment customers purchase a policy, to making a claim and being reimbursed. Every detail matters, including the types of payment methods on offer, the speed of the checkout process and the level of communications with the insurer. For instance, customers can use credit cards when paying for flight tickets or purchasing products from retailers, so they expect to be able to use their credit card when buying insurance policies too. It’s crucial to put the customers and their expectations at the forefront of the service and experience on offer and to deliver this in a timely manner.”
How would you describe the value of middleware partners with this consumer expectation in mind?
“The value of a middleware provider is in recognizing which business problem you're actually trying to solve. Choice in payment providers isn’t a problem for insurers, as there are enough providers and vendors out there. The problem is that there are too many of them, and they're scattered all over the spectrum. Most providers focus on collecting money, others (and very few) offer solutions to pay out money. Some only work in one market, others work everywhere. Most are connected via API (associate in personal insurance), while most insurers operate through old, bulk file formats. When you take a step back and look at large enterprises, the problem doesn't sit in choice.
The problem lies in execution – the technical integration. It takes a different kind of focus to integrate with all the different providers because the payment company may say they cover multiple payment types, but they don't cover every payment type in every market. There's no single provider that covers everything. A middleware provider really tackles the problem from a different perspective. They translate your business challenges, take them off your hands, do the heavy lifting around integration and leave you only with a choice to make around which provider you want to deploy. They take care of the corporate enterprise topics in the integration space between your corporate realities and the payments world.”
What do you think the insurance industry needs to focus on in order to develop a better relationship with their customers?
“The insurance industry needs to focus on customer experience and satisfaction, as these are vital components. In insurance, everything is very logical. They have all the contracts and rules, but they're missing the human touch. Insurers need to invest more heavily in creating a great engagement that augments the product. The consumer needs to feel that in the moment of truth, the insurer lived up to the promises and did so in a way that helped the customer and put them in a great space.”
How far away do you believe the insurance industry is from getting this strategy and executing on it properly?
“It’s difficult to put a timeline on it. Insurance is very distribution-oriented, meaning anybody who's given a KPI (key performance indicator) will optimize against that KPI, potentially at the expense of other goals. If your primary KPI as a broker or agent is to maximize sales and growth, written premium to earn your commissions, then everybody optimizes and rewards along that, while everything else may fall by the wayside. Even if people want to make these changes, the engine itself is just going one way. To get a feeling for the possible timelines and efforts needed, we need to look over to the industries that are much further along this journey. This tends to be industries with much more direct customer engagement, such as media, online shopping and transportation. Any industry where the product is “sold, not bought” or where there is an intermediary-driven distribution model will tend to be very far behind in terms of this area of focus.”