Insurers will be left behind if they do not change one-to-many models and adapt to the growing power among consumers in the transaction process, a global analyst has warned.
Ovum said a "fundamental lack of understanding" about who the customer was, meant insurers' traditional prominence on operational excellence and product focus would flail in the rapidly emerging savvy-consumer marketplace.
Ovum also said that until insurers understood who the customer was they would be unable to deliver the experience customers expected, adding insurers must tailor marketing to individual customers as closely as possible.
Barry Rabkin, principal analyst of insurance technology at Ovum, said: "Without a thorough knowledge of their customers, insurers are heading towards a competitive myopia.
"Customer experiences are becoming the basis of competition in the insurance industry and companies need to encompass customer needs, expectations and satisfaction into their customer experience management (CEM) strategy."
Developing technology is driving the consumer change, according to Ovum, and building individual customer experiences will be the "biggest challenge" insurance companies are facing.
Rabkin said: "In this age of "more", customers are increasingly expecting to receive a quality experience from their interactions with insurers.
"Insurers must quickly weave in the importance of customer experience into the company strategy at each touch point in order to succeed or fail to meet their expectations."
