“We want customers, no matter what product they are purchasing or interaction they are going through, to be able to contact us directly if they feel that it is in their best interest. “
Insightive.tv: Can you begin by giving an overview of your customer contracting process — how would a customer go about purchasing a product and signing documentation?
John: We believe that online contracting is a choice for customers. We have a multi-channel model through which customers can select their own journeys. We have both digital and analogue channels available for all of our insurance products. Through our digital channel, which accounts for the majority of our customer contracting, customers can complete that digital transaction quickly and easily with online paperwork provided via a customer portal.
Insightive.tv: Can you discuss any key projects you are working on, or have released in recent years?
John: Most of our digital focus has been on digitising the transactional end of the customer journey. Our blueprint for future development is to expand that transformation to aspects of the sales and service journey.
To date, there are three key components of digital transformation that we have developed. The first it called MyLife — digitising the application process for our life insurance and protection products. This provides a simple, easy and intuitive online contracting option for customers. The second project is called GI Digital — it is a companion project that has done the same thing for our household and general insurance products.
The third project is ongoing and could be described as a customer portal called MyAccount. This is a digital service that currently allows customers to review their products online and receive electronic policy documentation, make some policy changes and potentially develop a relationship with the company around other products. We aim to introduce fuller account management services into this platform.
Insightive.tv: What are the key outcomes you are seeking to achieve through offering these fully digital choices to customers? How important is operation efficiency or improved conversion rates?
John: It is all about adapting to the modern consumer’s needs. To our mind, operational efficiency and improving conversion rates are bi-products of improving the customer experience. There are even wider ranging benefits such as shrinking the company’s carbon footprint by reducing paper usage. But, if you focus on creating a good customer experience, the rest will almost certainly follow. In all digital projects, our primary focus is — are we responding to customer needs and customer feedback?
Our strategy in this regard is about giving customers choice. By giving customers choice, they are more likely to buy and remain with us. However, it is very important to have a simple and easy to use digital paths for customers to use. This is particularly important with financial service products that customers may only purchase once every four or five years and therefore they are not always familiar with the either the products or sales processes.
There is a lot of talk in the market about disruption. But it is hard to look at any of the key examples of this — driverless cars, telematics, and the internet of things, etc. — as anything other than customer demand for things to be made simpler, more personal and easier. As a service provider, it is ultimately our responsibility to meet these demands.
Insightive.tv: Regardless of the driver, do you see digitisation increasing over the next five years?
John: Digitisation will certainly increase. It is hard to imagine otherwise given the increased level of digital interactions throughout our society. But, at the same time, we are not aspiring to be a 100% digital business model. As I said, it is first and foremost about giving customers choice.
The idea that our more complicated processes, such as claims, could be completely digitised is not a model we are currently working towards. We believe some customers going through say a life insurance or critical illness claim will want to speak to a skilled claims agent. But its broader than that, we want customers, no matter what product they are purchasing or interaction they are going through, to be able to contact us directly if they feel that it is in their best interest.
As I said, the logical extension beyond digital contracting is to develop a more digitally robust service journey — such as additional coverage, amending a product option or buying other products. We imagine that these type of engagements can, for the majority of customers be moved from call centres to a digital channel, and this is something we intend to do.
Insightive.tv: What are the largest challenges you have faced making the transition to a more digitised business model?
John: There are really two linked challenges that we have had to confront. On the one hand, there is the problem of pulling together the threads of an insurance business that has a number of third party systems. This is a common scenario across the market. It is vital that all of that customer information can be pulled together and the systems interact in a way that allows us to recognise customers and talk to them in a clear way.
Linked to this is the challenge of data security. Making sure that we are protected against cybercrime is a top priority for us moving forward. Although third parties are integral to the development of new technological solutions, it can make the process more complicated. We therefore have robust contractual and audit relationships with our suppliers and they are very mindful of these priorities — putting mechanisms in place to secure that all critical services meet all requirements. This is in addition to our own in-house security protocols.
For anyone operating in a digital world, it would clearly be unwise not to be mindful, and ever increasingly so, of the importance of digital security.
John Hyde is Managing Director of Legal & General’s direct insurance operation. Over the three years he has held this position, John has expanded a track record of developing profitable direct consumer platforms. Before joining Legal & General in 2011, as Sales & Marketing Director, John held several senior sales positions at companies ranging from RBS to Homeserve and BGL Group. We spoke with John to uncover the digital strategy at Legal & General, and specifically to look at how digital contracting has played into the success the company has had courting direct digital distribution within the insurance industry.
Legal & General launched their first website in 1997 and is now the leading distributor of online household and life insurance products. They provide corporate, institutional and retail services to over 10 million customers — emphasizing the use of multi-channel distribution driven by customer choice.
THE DIGITAL FUTURE OF CUSTOMER CONTRACTING series