To be a market leader in the future, insurers need to transition their thinking from being an auto insurer to being a mobility provider, for which auto insurance may be just one component, according to Majesco’s new research report
Morristown, NJ (June 4, 2020) – Majesco, a global leader of cloud insurance software solutions for insurance business transformation, is pleased to announce the release of their 5th annual primary consumer research study, Rethinking Auto: From Auto Insurance Transaction to Mobility Customer Experience, which takes a deeper dive into the market shifts and generational buying differences for automobiles, highlighting a shift from auto as a policy transaction to a mobility experience. The report provides a detailed analysis into the generational differences in the types of transportation options used and the expectations for a broader mobility experience that includes a risk product, access to other transportation options, and other value-added services.
“With so much change occurring in the automotive space, companies from outside the insurance industry are coalescing around a shift to mobility, which will have far reaching implications for auto insurance providers,” stated Denise Garth, SVP of Strategic Marketing, Industry Relations and Innovation at Majesco. “Mobility options are important to customers and are fulfilled in different ways well beyond traditional vehicle ownership, a significant shift that is impacting business models from automotive companies to insurance companies alike.”
Mobility brings together different elements of other markets or industries, including insurance, that enable and support an array of options. Unfortunately, the customer experience is fragmented for each of these elements, creating an inconsistent and difficult customer journey because they have to work with the different parties individually. New mobility options and experiences are emerging that will potentially reduce, reallocate or eliminate a substantial portion of today’s auto insurance premiums. To retain the customer and revenue, insurers must rethink their business beyond an auto insurance transaction to a broader mobility experience, offering new revenue options.
The research highlighted the differences between Millennials and Gen Z versus Gen X and Boomers, including:
- 28% of the younger generation use a device or app to record mileage and driving behavior as compared to 15% for the older generation – nearly a 100% difference.
- 11% rented someone else’s car through a sharing service and 9% rented out their car versus 2% and 1 % for the older generation.
- 30% of the younger generation are using or would use an all-inclusive vehicle subscription service – nearly four times higher than the older generation, indicating interest in different mobility options as compared to “owning” a vehicle.
- 40% of the younger generational segment would pay $10 per month for a mobility solution with access to a wide array of services, as compared to only 20% of the older generation, a 100% difference.
- The younger generation is twice as likely to buy auto insurance from a car shopping website or a vehicle manufacturer website, have it included in the purchase or lease of a vehicle, or buy it from Amazon or Google.
The results of this research highlight how the next generation of insurance buyers’ use of mobility options will dramatically change, requiring insurers to change as well. To be a market leader in the future, insurers need to transition their thinking from being an auto insurer to being a mobility provider, for which auto insurance may be just one component.
Download a copy of the report at www.majesco.com/white-papers/rethinking-auto-insurance/.
Majesco (NASDAQ:MJCO) provides technology, expertise, and leadership that helps insurers modernize, innovate and connect to build the future of their business – and the future of insurance – at speed and scale. Our platforms connect people and businesses to insurance in ways that are innovative, hyper-relevant, compelling and personal. Over 200 insurance companies worldwide in P&C, L&A and Group Benefits are transforming their businesses by modernizing, optimizing or creating new business models with Majesco. Our market-leading solutions include CloudInsurer® P&C Core Suite (Policy, Billing, Claims); CloudInsurer® LifePlus Solutions (AdminPlus, AdvicePlus, IllustratePlus, DistributionPlus); CloudInsurer® L&A and Group Core Suite (Policy, Billing, Claims); Digital1st® Insurance with Digital1st® Engagement, Digital1st® EcoExchange and Digital1st® Platform – a cloud-native, microservices and open API platform; Distribution Management, Data and Analytics and an Enterprise Data Warehouse. For more details on Majesco, please visit www.majesco.com.
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SOURCE: MajescoTags: auto insurance, customer experience (CX), Majesco, Millennials, Mobility as a Service (MaaS), Transformation