These days, the "platform economy" is a hot topic of conservation amongst economic experts and the trade media. Major international corporations such as Facebook, Google, Amazon, Apple, and Alibaba dominate the daily headlines. Rarely, however, do insurance companies get thrown into the mix. The reason? These companies often lack the necessary infrastructure.
Inspired by leading role models such as Amazon, more and more German companies are revealing their own desire to become customer platforms. The Otto Group is opening up to other providers, Douglas is hoping to transform itself into a beauty platform by offering additional services, and Zalando is defining itself as an operating system for the fashion world. The idea behind the platform economy is simple yet compelling: customers are presented with suitable offers for every life situation. Instead of buying a single product or service from a company, the customer becomes loyal to the respective platform. Platform operators generate profits by way of commissions, additional services, or simply the customer data and knowledge that is acquired over time. It sounds easy. So why is it so difficult to achieve? In Germany, companies have not invested nearly enough in the development of these platforms, and the insurance industry, in particular, is lagging far behind in the race.
Why is Allianz creating a banking app?
Insurance companies have always enjoyed an easygoing relationship with their customers. After policies are signed, they are entered into the system and customers pay their premiums. Once a year, or shortly before their policy expires, the customer receives a call from their agent with an offer to take out new policies. Unless a claim was made, most customers only ever think of their insurers while reviewing their account statements. It is precisely this "silence" that prevents customers from identifying with insurance companies. Customers take out policies with the least expensive providers, a trend that has been reinforced by clear-cut comparison sites on the Internet. But the platform concept of an e-commerce giant like Amazon is different: here, the tool of choice is "Prime," the notorious customer loyalty program offering lower shipping fees, a streaming service, online storage space, and even food deliveries. Once customers are comfortable, they have to think long and hard before switching to another marketplace or provider.
In fact, Allianz is banking on it. At the end of January, the company caused a stir by announcing that it wanted to develop a multipurpose banking app. Although no details have been revealed with regard to specific features, the move is consistent with the company's wish to become a player in the platform economy. After all, banking is also about money.
Customers have much to gain from an app that not only lets them perform their banking transactions, but also provides for a global overview of their finances, including their insurance policies and investments. And for the insurer, the app not only serves as an opportunity to be positioned as a partner in money matters, but perhaps also as a starting point for introducing additional and complementary products to customers.
What's more, Allianz has declared that the app will not just be for existing customers. It will be offered to all users, including people who are not yet Allianz customers.
A platform made of interfaces, data, and artificial intelligence
Technically speaking, Allianz's ability to offer its own banking app has only been made possible by the fact that, with the introduction of PSD2, the banking industry has lost its monopoly on account data - and thus a clear competitive advantage it has neglected for far too long. Credit institutions must now standardize account information, and upon receiving consent from customers, make this data available to third parties.
On the other hand, if an insurer such as Allianz wants to perform a comprehensive financial analysis, the incoming data must be linked to the customer's existing data. This requires suitable interfaces and an unrestricted flow of data – two objectives that are far from being fulfilled in the data centers of the insurance industry.
The launch of an app as an extension to an offer can only be considered a first step towards a platform. What are some other services, rates, or products that might interest policyholders? This question might be answered by way of analyses performed with artificial intelligence. Once they are set up and implemented, these analyses include all touchpoints with customers and prospects and draw from posts made on social media (for example) to obtain a clearer picture of customers and their needs. Together, interfaces and AI form the basis for new business models and service offers such as telematics rates.
The insurance industry is still in the race to develop customer platforms. To win, insurance companies must not only work on concepts, but also develop their IT infrastructure. We would be happy to explain to you in a personal conversation how you can master this.