Recently, well for the past 3 years or so, there has been an increasing focus on the insurance industry to change and for users to have simplified processes. This focus is even more apparent to enable shared economy insurance and Gig worker or freelancer insurance to work. The pressure has been put on the existing players in the industry to shake up and start to work out how to build tailored insurance policies that are fit for purpose in this new shared and gig world of work. Progress? Right now, it’s just hard!
This difficulty is starting to allow new companies to come in and threaten the existing players. This is a good thing and we are seeing the industry embracing these new companies and accepting them.
This was all looking like an interesting play for the likes of Google and Facebook. That is until you hear that Facebook now have said that most of its 2 billion users could have had their data accessed improperly, giving fresh evidence of the ways the social-media giant failed to protect people’s privacy while generating billions of dollars in revenue from the information.
These companies want to do everything (books, to travel; insurance to home cleaning) and use their power over the data to exploit their users. But now we see the cost.
“What we didn’t do until recently and what we are doing now is just take a broader view looking to be more restrictive in ways data could be misused. We also didn’t build our operations fast enough — and that’s on me.”Sheryl Sandberg, COO Facebook
Their focus is on ‘customer experience’ and sucking every business income stream into their machine. Google and Facebook use AI and machine learning to read data and monitor your usage of their technology to serve you up what they think you need and what’s profitable for them. This data usage has been abused to drive revenue to match their huge future focused valuations.
The new InsurTech / FinTech start-ups are focused on ‘customer experience’ too. This is defined by cutting down questions to a minimum, using ‘social’ data to fill in the blanks to give you a quote for insurance or a loan. These companies use customers social media, third party apps and other accounts to gain information to provide quotes and service with minimum input from the user. But what data is being used and who checks this? And do we ever read the small print?
Is this acceptable? Is complying with new data protection rules enough? Or is it time to take back your data?
When I ask data professionals about taking back your data they shrug and say it’s out there already, so what’s the point. I disagree with this and think now is the time to take a stand and we should stop accepting that companies have a free flow use to your data and just scrape and access data for on the back of providing customer experience.
For example, Facebook’s search tool to find other people, now disabled, has been used to scrape public profile information, and now Facebook have said “Given the scale and sophistication of the activity we’ve seen, we believe most people on Facebook could have had their public profile scraped in this way.” They just noticed this? This was a feature built into Facebook for customer experience.
It’s interesting that Facebooks main defence from Mark Zuckerburg is:
“We didn’t take a broad enough view of what our responsibility was and that was a huge mistake.”
These new young, keen, naïve, start-up companies who want to take over the world live in their own created bubbles – thinking everyone is like them, that they know what an ‘experience’ is and that everyone wants to know who joined, who could be a friend, who’s got a new job, who your friend is dating, etc and allowing this free use of data to create value, not for the user, but the company. This practice is in DNA of these companies, exploiting date is a core theme. It’s the route to their value.
Having worked in the very often slow and frustratingly compliant world of insurance I can say exploiting data is not at its core, risk management is. Hence the customer experience is very very poor for most insurance interaction. It is no wonder that the Insurtech focus has been on ‘experience’ as their main ‘disruption tool’. But at what cost, and shouldn’t the user want to know what data is being consumed to give their quote?
There needs to be a balance between using ‘social’ data and re-modelling the insurance. Real work needs to be done on the very fabric of the way insurance works for the shared economy and gig economy insurance to make the whole experience work. Not just the buying of insurance but the whole process – end to end. Even where the policy lasts only one night or one hour. It’s not about scraping data and using social accounts its about real work dismantling the policies and the process to give insurance focused processes and to show the customer what data is used and how this impacts risk management in the event of a claim.