1. Executive summary
Smartphones have overtaken laptops as the UK internet user’s number 1 device*. In fact, 66% of people
in the UK now own a smartphone, up from 39% in 2012*. With the UK being the 3rd largest insurance
& long term savings industry in the world and playing an essential part in the UK’s economic strength,
managing investments of £1.9 trn (equivalent to 25% of the UK’s total net worth)**, the insurance industry
could benefit from adopting the ever-rising mobile trend by shifting their traditional model.
Insurance companies should aim to:
• Become increasingly customer-centric
• Engage in a two-way collaborative relationships and dialogues with customers
• Adopt agile operating models whilst adopting the philosophy of “insurance as a service”
• Increase brand awareness through personalized content
Mobile - Just A Medium?
The insurance industry is not at the forefront of digital disruption, being considered one of the most
traditional sectors (institutions such as the historical Lloyd’s of London have existed since as early as the
17th century). Today, insurers must shift their traditional image as purely providers of policy cover to that of
insurance as a service by providing additional services linked to various insurance lines. This is especially
important if they wish to have a dialogue with younger, first time insurance buyers keeping in mind that
96% of 16-24 year olds in the UK, now own a mobile.*********
The current mobile trend in the insurance sector
Some insurance companies that provide highly commoditized personal lines e.g. car insurance, such as
Direct Line or Aviva have been wise to the mobile trend and are using the opportunity of mobile to provide
users with information via their phones. These companies use mobile for basic functions such as filling in
or retrieving a quote.
The above mentioned companies have also built mobile apps dedicated to sharing basic information such
as policyholder information, renewals, claims or prevention information (personal health indicators, driving
stats, how to’s etc.).
All these functions though, are using mobile as a medium for one-way communication with an audience
that is increasingly advanced and technically minded. By using mobile, insurance companies can engage
in a dialogue with their audience and thus increase their brand awareness through social media content.
Complex distribution, operating models and financial
transactions regulated by local financial authorities
and legislation mean that data is an essential asset
in most companies in the insurance sector. Data that
can be found in these companies’ systems
(policyholders’ data, actuarial and claims statistics)
gives the insurance industry a great potential for
technological innovation. Mobile provides
opportunities such as access to analytics for
developing customer profiles, personalisation of
offers and building brand personality and awareness
through content across social media platforms.
Percentage of people aged 16-24 owning a
smartphone

2. Smartphones are ripe for two-way communication and the list of new technologies embedded in their
operating system and their associated opportunities is ever growing. Mobile is a significant customer
relationship channel.
Challenges mobile and today’s insurance distribution models
One of the potential perceived challenges which possibly prevented insurance companies to adopt mobile
thus far, could be that insurers will increasingly be targeting direct customers via this medium which would
mean that the traditional roles of brokers and managing agents would shift.
One way for insurance companies to counter this risk is to provide mobile underwriting portals for their
brokers and managing general agents. For the active brokers whose main concerns are growing portfolio
and income or creating and maintaining a network, these mobile portals will alleviate part of their work with
ease of access to all their day-to-day operational needs: policyholder and risk information, claims
information, commission, technical documentation etc. Brokers and managing agents will hence shift their
focus from administrative tasks to increasingly making data based decisions, engaging with their direct
customers and growing new portfolios through web content, social media and other channels.
The opportunities outweigh the risk: increased customer insight, becoming a customer-centric
organisation and increased customer loyalty and satisfaction.
“In this emerging world, insurance will be about individual protection generally, rather than a policy for your
car, house, etc.” Neff Hudson, emerging channels executive at USAA for the Economist.
Recommended Mobile Opportunities in the Insurance Industry

3. 1. GPS LOCATION BASED SERVICES
This technology gives you the ability to offer ‘pay as you use’ insurance which could increase your
potential customer base. This will not only reduce insurance premiums for the customer and additional
security for the car owner but also build trust in you as the insurer. This would also improve response rates
in accident / breakdown situations. A consideration to evaluate before executing would be agreements
between customers and the insurance company regarding the usage of vehicle data. Testing and high
quality GPS technology required would also be essential.
2. MOBILE PAYMENTS & NEAR FIELD COMMUNICATION BENEFITS
Remote activation of contracts and guarantees means improved efficiencies in setting up policies, less
administration and reduces the risk of contracts not being received / signed upon receipt.
In addition, Improved efficiency and reduced risk to insurers of non-payment after agreement is set up.
There is also a real opportunity to sell insurance / guarantee products directly upon purchase of goods,
which may have been missed if reliant on paperwork.
The security risks including payment details and possible identity theft need to be controlled to instill
confidence in the customer but the increase of mobile payment options (Apple Pay, Android Pay,
paypal etc) and the increase in sales over mobile technology indicates that confidence in mobile payment
is already strong. More than 50% of UK online sales were made through mobile devices in Q4 of 2015/16
according to the latest IMRG Capgemini Quarterly Budget report. In January sales via smartphone grew
95.6% year on year, over 7 x more than the rate of those via tablets***
3. INTERNET OF THINGS (IoT)
As Internet of Things technology develops, the impact on the areas highly relevant to insurers is
increasing. Estimates of Internet-connected devices (machines, homes, wearables) range from 50 billion
to 1 trillion by 2020**** . The growing popularity of the connected ecosystem creates a variety of
opportunities for insurers.
One key opportunity in IoT is Connected Homes, utilising the technology for contents insurance and theft
prevention. In terms of Prevention, this means reduced claim frequency and severity. Customers can be
notified by the insurance company through a mobile app reporting on data received from the connected
camera and detectors that can lead to automatic action by connected locks.
Another key opportunity in IoT is Wearables. Personal information collected through wearables and
smartphones can be sent to doctors and insurers to produce a health score. Customers will be charged
based on their score as well as encouraged to implement healthy lifestyle through mobile apps. If progress
was made customers would receive discounts and premium incentives. Mobile technology will thus enable
companies to communicate and collect data effectively as well as provide customers with tailored content.
Technological innovations will lead to life-based insurance, it’s been found that more than 80% of
people******would be willing to share their health data anonymously to reduce healthcare costs and
improve treatment.
Usage Based Insurance is the final area we strongly recommend you consider investing, in relation to
IoT.
Smartphones are becoming increasingly powerful and now have the functionality to support usage-based
insurance (UBI). Insurance providers are pricing the risk based on the set of individual scores collected
using sensors on the customers’ cars and other factors. This enables customers to have more control over
their insurance costs. In addition, smartphones can make the process more engaging by sending real-time
feedback in-turn helping the drivers to become safer which would lead to a lower premium and less risk.
This would also enable a longer-term relationship with the customer beyond the sale.
Key Considerations that would need to be scoped within IoT are reliance on the technology performing
and also the storing and security of private information. However, mobile technology would enable
insurance firms to respond and communicate with the customer quicker to minimise the impact of the data
breach for businesses as well as individuals.

4. Future Gazing
A growth area worth keeping an eye on for future is Augmented reality & object recognition.
Augmented reality (AR) has been a default app on Microsoft mobile devices since 2013 and it is expected
to be a standard feature of all new smartphones within the next five years*******. This will make a positive
impact on extending usability, visual searching and cataloging in a scene, object category specific
recommendation systems, image recognition that triggers augmented reality and more. Home insurance
customers can walk around and catalogue their belongings or car insurance customers make claims
through their mobile with the app recognising the damage done.
Although it remains a challenge to develop object recognition and AR, it is a considerable future trend that
all big players of technology and social media have their eyes on. The technology is still maturing but in
near future will be part of everyday online life ********
Marketing Regulations
Insurance companies should be mindful at all times about marketing and advertising regulations (such as
UK advertising codes - CAP) before executing any of the tactics we have highlighted. In particular:
• Price statements must not lead by omission, undue emphasis or distortion. They must relate to the
product featured in the marketing communication. For areas such as GPS location, this needs to be
taken account as price will ‘flex’ based on a customer’s personal circumstances.
• Databases are accurate and up-to-date and that reasonable requests for corrections to personal infor-
mation are effected within 60 days. When dealing with mobile payments, it will be essential that cus-
tomer’s personal details are accurate.
• Marketing communications must state significant limitations and qualifications. Qualifications may
clarify but must not contradict the claims that they qualify. For technologies within the IOT discipline, it
will be vitally important to ensure claims about the abilities of these technology are accurate and legal.
• Marketing communications must be obviously identifiable as such and customers should not be con-
tacted persistently through unwanted marketing communication. This is especially important for areas
such as usage based insurance where you are trusted with customer’s personal information.
Conclusion
It is vital that insurance companies adopt mobile technology as a tool to interact and collaborate with its
customers. If this technology is not utilised to its full potential, established, traditional insurance companies
could lose out to newer, innovative start ups who are more willing to embrace such technologies.
References:
*06 August 2015, OFCOM, (http://media.ofcom.org.uk/news/2015/cmr-uk-2015/).
** Association of British Insurers, Sept 2015, https://www.abi.org.uk/~/media/Files/Documents/Publica-
tions/Public/2015/Statistics/Key%20Facts%202015.pdf
***realtimes.co.uk published 24/2/16.http://www.retailtimes.co.uk/44318-2/
****Statista 2016, http://www.statista.com/statistics/271851/smartphone-owners-in-the-united-kingdom-uk-
by-age/
***** Pwc, 2013, http://www.pwc.com/us/en/technology-forecast/2013/issue1/assets/pdf/techforecast-
2013-issue-1.pdf
******Tower Watson, 2014, https://www.towerswatson.com/en-GB/Insights/Newsletters/Global/empha-
sis/2014/the-internet-of-things-is-transforming-the-insurance-industry
*******http://www.createtomorrow.co.uk/en/live-examples/future-gazing-ar
********http://cvgl.stanford.edu/papers/Kumar_cvpr12.pdf
*********https://www.consumerbarometer.com/en/trending/?countryCode=UK&category=TRN-AGE-UN-
DER-25