Consumers want more integrated insurance offerings. The financial industry expects substantial revenue growth in this area, according to an international study.
Consumers are increasingly digital. This sets the stage for the accelerated adoption of insurance products in financial services platforms. It also intensifies competition in the race for digital wallets. Meanwhile, financial sector executives involved in insurance decision-making expect a sharp increase in revenue from embedded insurance offerings.
Increasingly a Necessity
That's the conclusion of a recent survey by US insurer Chubb in a study titled «Banks and the Digital Wallet Race - The Embedded Insurance Strategy». It shows a majority of 56 percent of executives surveyed expect to generate more than 10 percent of their revenue from embedded insurance services in three years. Currently, only one in five companies generate more than 10 percent of their revenue from such products.
An increasing number of banks and fintechs also view digital insurance solutions embedded in websites and apps as must-haves rather than nice-to-have offerings. Eighty-one percent of respondents said digital insurance embedded in websites and apps is a necessity rather than an optional offering indicating, among other things, an increasing acceptance of insurance products on financial services platforms.
Particularly Pronounced in Asia
This trend is most pronounced in emerging markets in Latin America and Asia, while consumer interest is surging in Europe. According to the study, consumer demand for integrated insurance is booming, and more than half of consumers surveyed globally expressed interest in purchasing additional insurance. Forty-six percent of consumers believe digital channels are the most convenient way to purchase insurance.
The global survey of 2,000 consumers and 200 financial industry executives was conducted in the second quarter of this year.
