Maximizing revenue growth with embedded insurance

Embedded insurance is tapping into the wider embedded finance trend and all for good reason. Promising to meet customer needs and demands, embedded insurance is a direct integration of insurance offerings with consumer products that offer seamless transactions and enhanced convenience. Projected to grow more than six times larger by 2030 to $722BN in GWP, embedded insurance is greatly revolutionising the insurance industry.

We’ve all had contact with embedded insurance in our day-to-day lives. One common example being when booking a train ticket and being offered insurance options at the point of sale. However, the use cases go beyond this and today’s market offers a great opportunity for businesses to meet customers where they are, regardless of the industry or sector. Businesses can grow their profit margins greatly with embedded insurance offerings - it’s just the case of adopting the right business model that allows flexible growth opportunities.

What’s the embedded insurance selling point?

With embedded insurance, businesses can integrate insurance offerings into their infrastructure, products, and online services via third-party platforms and APIs. Business owners – whether bank, retailer, or online marketplace – can improve their customer value proposition and scale up their businesses with ease.

In today's saturated market, characterised by savvy consumers with increasing demands, customer satisfaction has never been more essential. Embedded insurance provides companies with the opportunity to enhance customer engagement with personalised solutions. The result is a sustained and expanded customer base which translates into new revenue streams for its proponents.

Developing the right embedded insurance model 

The most effective business strategy for sustained growth is a flexible, digital-first model. One that allows businesses to continuously adapt to evolving customer preferences, optimise processes, and leverage data insights, ensuring long-term success in an ever-changing market landscape. By keeping the customer as the focal point, businesses can offer competitive solutions that their client base both demands and needs, in turn helping to grow their revenues.

• Establishing and maintaining a customer-centric model

Regardless of the service, platform or offering, customers seek seamless experiences, and the insurance industry should hold itself to the same standard.

To increase customer retention, and offer the best competitive solutions, companies should align themselves with these growing expectations of personalised experiences. This means making insurance easy to purchase at the point of sale. Businesses can use embedded insurance to consolidate multiple types of coverage into a single policy, removing the hassle of seeking different providers online. In the end, the goal is to ensure customer satisfaction with a simple and easy add-on customised that fits their needs.

When executed effectively, consumers who can easily purchase insurance alongside digital products are more likely to become repeat customers, keeping them within company ecosystems for longer. This ongoing engagement yields a wealth of information on customer trends and habits  - which can then be used to help businesses continually tailor and improve the online experience tailored to these insights. It’s a mutually beneficial relationship.

• A seamless digital-first process

Anyone can offer insurance policies as an add-on feature at the point of sale, but the challenge is selecting the right insurance technology partner to fulfil specific needs. Businesses must look towards partners who can easily integrate into their existing stack, allowing them to overcome access barriers easily. Ensuring compatibility and scalability is crucial to ensure a harmonious fit in one’s business model. Additionally, it’s important that partners can provide customised solutions and services to meet specific business needs.

With embedded insurance, everyone wins 

Embedded insurance is revolutionising the industry for good reason. It benefits insurers due to its greater efficiency, coverage and reduced costs, features which may not have been accessible under older policies. For non-insurers, it means additional revenue and customer engagement opportunities.

Overall, the emergence of embedded insurance introduces a novel model to effectively distribute insurance services and revolutionise the way insurers and their customers interact. Naturally, it's a win-win for all parties.