Some insights from Paul Frick at Pattern Insurance for you, on embedded insurance cover in the travel sector;
A dynamic, fast-moving sector of the economy, the aviation industry must remain agile and continually innovate to stay one step ahead of the competition. To secure and increase vital market share, airlines are constantly on the lookout for new services and benefits to attract and retain customers. Never standing still, one service that is rapidly being adopted by commercially savvy airlines to satisfy customer demand is embedded insurance.
When a customer buys an airline ticket, this type of insurance is ‘embedded’ in the existing customer purchasing journey. Typically, depending on requirements, embedded insurance protects against unexpected events such as flight cancellations, trip delays, medical emergencies, and lost or stolen baggage. Constantly evolving, embedded insurance presents an opportunity for airlines to offer customers tailored, relevant protection add-ons to their existing purchase.
Used to its full capacity, embedded insurance can provide significant benefits to both airline and customer. Over and above the obvious reward of increasing revenue by offering hyper-relevant, easy-to-purchase protection along the existing customer journey.
Travel insurance provides customers with peace of mind and protects them from unexpected costs. However, they are more likely to purchase when thought and consideration has gone into devising a robust customer-oriented strategy.
Key areas to consider in developing this include;
· Detail: it’s imperative to clearly describe the optional extras and allow customers to click for more detail so no information is hidden or missing.
· Bundles: offer bundles using a ‘good, better and best’ approach to encourage purchase and streamline the customer experience.
· Choice: be sure to honour the customers right to choose and avoid frustration by allowing unwanted items to be easily removed from the shopping cart.
· Transparency: don’t try and hide pricing or avoid detail, list the chosen elements clearly and fully disclose the price of individual items before check-out. Customers are much more likely to purchase if they can see the full details and pricing.
Of course, the technology is only ever as good as the flexibility of the platform itself. Airlines can maximise their success of using embedded insurance by ensuring they are able to offer relevant, real-time protections, instead of static content.
As a start airlines should consider the following areas:
· Transform the customer experience: offer personalised product and pricing solutions which suit the customer’s needs at every step of the purchasing journey. This includes before purchase, post purchase, before departure and during the trip itself.
· Harness the latest technology: be sure to use the technology at your fingertips to its maximum effect. If possible, consider creating unified solutions with AI-powered data than underpins real-time decision making.
· Collaborate across your organisation: to improve customer experience and maximise revenue, don’t work in silo. Connect product development, distribution, and commercial models with intelligent applications for best results.
Staying ahead of the competition and retaining valuable market share is vital to the success of airlines. With embedded travel protection, airlines can reap all the benefits of offering real-time protection without having to navigate complicated insurance policies. In turn, the customer too benefits, both from an enhanced experience and ultimate peace of mind with easy access to the protections and policies they desire.
About the Author
Paul Frick is the Vice President of Sales EMEA for Pattern Insurance. Paul is spearheading growth in the EMEA embedded insurance market. He brings a wealth of experience and was most recently responsible for the strategy and development of the travel business for AXA Partners in Northern Europe. He was recently the Head of Travel Central Zone Germany/Austria/Switzerland for AIG.