Choosing the right distribution strategy for the right insurance customer

Advances in digital technologies set the path to new customer behavior and a significant shift in insurance distribution, but opened new opportunities for insurers for better segmentation, targeting and distribution. 

A global study by Accenture gathered the views of over 32,000 insurance customers in 18 countries, providing valuable insights on how people expect to interact with their insurers, their attitude towards insurance digitalization, pricing, and the meaning of loyalty. 

Three distinct groups emerged: nomads, hunters and quality seekers. Who are they and most importantly, what do they want? 

My insurer, my risk coach 

It is time to face the known truth, price is the number one loyalty trigger for auto and household insurance. It is a major factor in life insurance, also. Yet, there is an expectation arising from customers to receive valuable advice from their insurers, to live healthier, safer lives. In the end reducing the risk means a smaller price.  

Managing the risk as they face it 

Overall: personalized advice on reducing risk and loss 

Household: alerts on smoke, fire. Pair it up with smart home devices 

Life: emergency services – notification to family in case of event, or the nearest hospital; health monitoring services 

Auto: real time notifications when driving on roads with high frequency of accidents; personalized advice on being a safer driver 

Advice can come in different ways, from the insurance agent, or can be computer generated. The areas with most requests are insurance coverings and retirement planning. 

Partnerships like never before 

Traditional channels are still the preferred ways for most of the insurers and their clients, yet both parties would like to add more digital solutions. Still, relying on old systems, insurance companies will have a tough time in responding to customers’ high expectations that are already met by other industries: telecom, banking, retail. 

Finding new distribution partners 

Globally, people are willing to try other distribution models. The adoption rate would still be subject to local market characteristics, but insurers should consider testing new distribution partnerships.  

Another option might be plug and play into an existing network such as Google, Amazon, supermarkets, retailers. Treat this as an opportunity to remain relevant. 

For a more traditional approach, keep in mind that 60% of the interviewed customers would consider buying insurance from banks. 

Finding partners for adding valuable services to insurance products 

Opportunities may be found everywhere if thinking outside the limits of the insurance products solely as risk management from financial loss point of view. 

Emergency services, manufacturers of smart devices, fitness brands, cars manufacturers who add sensors for impact that trigger, emergency calls (see the European initiative eCall), claim files and payments, or driving tips included according to your driving style; all the above could be ideas that add value to a product exposed to commoditization.  

The new normal and the Phygital landscape 

Accenture’s research findings revealed three customer personas differentiated by attitudes towards pricing and low cost, their interest in high-quality and responsive service. Also, trust as a form of data protection and interest in digitalization are defined as two other loyalty drivers. 

A highly digitalized group is now redefining the new normal. Shortly, they are not tied to traditional financial service providers, value digitalization and want new ways to access services and advice. They are the youngest and fastest-growing segment, therefore the future of the financial industry. Yet, not many companies are ready to handle their expectations. The “core business” mindset most of the insurers run the business on, determines the lack of agility, the low-risk approach to innovation, the “let’s hope nothing changes” attitude. This explains the growing number of insurance start-ups and insurtech companies that cut some of the market share pie away from the traditional insurers but create new market opportunities and segments that didn’t show any interest towards the old-fashioned way. 

“There is no doubt that customers are turning increasingly to digital and mobile channels to research their insurance options and request quotes. But it is just as clear that they continue to value human advice, and many prefer to buy their insurance from an agent or broker. A hybrid distribution model that combines online and mobile channels with agent/call center/chat support therefore continues to have high potential.” 


There are some myths about things moving fully into the digital world, mostly among insurance sales people. A recent study by Google busted them, confirming there is indeed a symbiosis between the online and offline, summed up by ROPO – research online, purchase offline. 

Search results are a powerful tool for driving customers to visit the stores. 

3 in 4 who find local information in search results helpful are more likely to visit stores 

Remember, once in your agency, the customer might still be checking out what is on your website, in fact more than a half are still looking for you while in-store. The only difference is that now they want an informative, customized experience. 

How to take advantage of this change?

  1.  Provide relevant, local info via search and online 
  2. Help customers while in-store, improve their experience 
  3. Provide customized offers and recommendations 


The Nomads 

Attracted by pay-per-use 

This buyer persona wants personalization, flexible pay-per-use insurance coverage online or via mobile for specific temporary needs.  

Targeting Nomads means demonstrating them how their behaviors can reduce the price they pay for insurance. 

Ready to transition to a new digital model  

As they are being comfortable with the computer-generated advice, the involvement of the insurance agent is moved later in the buying process, only sometimes in the closing phase or if complex topics need explanation. Nevertheless, more than half are considering an online-only customer journey. 

Open to sharing data in return of new benefits 

Traditionally, insurers collect lots of data that do not really use outside business as usual. In addition to lower prices, insurers should consider exploring what these customers would want in return of sharing their data.  

63% want personalized information to reduce the risk of injury or loss, in return for sharing data 

Will migrate to non-insurance firms 

Distribution partnerships with non-insurers should be considered since exploring new providers a Nomad insight.  

74% would be willing to consider buying insurance from Amazon or Google 

55% would be willing to consider buying from a supermarket or retailer 

The Hunter 

Cost matters for traditional insurance buyers 

Hunters want to work with insurers, but insurers should not take this loyalty for granted. They are looking for the right offer at the right time and expect value for money., meaning a good quality of service in relation to the amount paid. 

100% say competitive pricing is a top driver of loyalty 

Value human advice on insurance purchases 

When seeking human contact insurance customers expect to receive expert personalized advice. This takes time to deliver. Process automation and cutting time from administrative tasks can free-up agents so they can deliver the value-added advice that Hunters seek. 

Agents are important for more complex advice  

Dealing with complex situations and delivering insurance knowledge is a winning strategy when targeting Hunters. This is means years of experience in the industry, but also training. Remember: 

42% use their agent to make a claim  

Open to data-driven offerings 

Insurers pursuing Hunters should accelerate efforts to provide telematics-based data capture 

67% are interested in adjustments to auto insurance costs based on car usage patterns  

The Quality Seekers 

Driven by service and trust 

Targeting Quality Seekers means high-everything – high quality service, high level of automation of transactions, high personalization. 

Need to trust the integrity of their insurer 

Data security and protecting customers’ interests are loyalty drivers for this segment, but insurers need to add transparency and demonstrate how collecting certain data has an impact in the offers made in return. 

Fast and convenient 

Insurers should add speed to the growing expectations list of Quality Seekers. Add these to their priority service demand and you’ll see a request for premium insurance services. 

 To sum up, insurers should develop different customer journeys for each buyer persona: an online-everything for the Nomads, with agents and call-center ready to intervene at any moment to push the sale to closing; be prepared to review the cost structure to bring down pricing while providing value and service to Hunters. Add high quality service, high level of automation of transactions, high personalization if the strategy is to target Quality Seekers which is a good positioning opportunity as a premium insurance provider. 

Read the full report here.