How FWD changed travel insurance claims forever: An Interview with FWD’s CMO
When FWD Insurance stormed onto the insurance scene in September 2016, they were relatively unknown in Singapore. Now with a full range of insurance offerings ranging from endowment, term life, car insurance, travel insurance, maid insurance and even motorcycle insurance, the company has come into its own and found a unique niche within the saturated market.
ZUU Online caught up with FWD’s Chief Marketing Officer David Broom to learn what is propelling the insurance company forward.
“I can summarise FWD’s philosophy in one word: Simplicity,” said Broom. “Everything for me is simplicity for the customer. I’ve seen a lot of people talk about building engagement, but I have not met a single person who has told me that they want to engage with their insurer. Insurance companies want to engage with customers, but customers just want things to be quick and simple.”
In fact, the industry veteran with over 10 years of experience in insurance, admitted that he came to Singapore to build an insurance company that truly focused on the customer. So what does Broom think customers want? “Make it quick, make it simple, and let me get on with my life. When I want to engage with you, which is the point of claim, then I want you to be there. But before then, just make it easy for me,” he says.
Overturning the claims process
One of the ways Broom has attempted to change the insurance landscape, was through the overhaul of the claims process.
“For me, claims are the moment of truth. That’s why people buy insurance,” he said. “People don’t buy insurance because it’s fun to buy. They buy it because if they ever unfortunately have to use it, they will want the claims to be done easily.”
Broom recounted how he barely made his connecting flight to Singapore after a delay on the earlier leg of his journey. While he made it to the flight, his bags did not. Ironically, after all the hassle of submitting forms at Changi Airport and purchasing new clothing, Broom decided not to claim for the delay from his insurer.
“I was insured in the UK, and I could have made a claim. But the problem was when I went to make a claim, I went online and it took me to a webpage with 15 different pdfs. I had to download the pdf, fill it in, and then mail it over to the UK,” he said exasperated. “I’d already filled in all of the information necessary at the airport. The airport had already stamped saying that my bags had been delayed and will be delivered to me. What more do we need as an insurer to pay that claim other than a picture of that stamped document?”
As a result, FWD now offers its travel insurance policy holders the option of submitting a claim for travel delays and baggage delays by sending a picture of the relevant document through WhatsApp. All other claims can also be easily done online.
Another of Broom’s pet peeves was how online forms would often ask applicants for the same information they provided when they purchased the policy.
“Why would I need to tell a company – whom I’ve already bought a product from – what my name is? They shouldn’t have to ask it again,” said Broom.
“If you go online for claims, FWD won’t ask you the same question twice. I won’t ask you where you live, I won’t ask you what your name is. I won’t ask how to address you. You’ve already done that when you purchased. All I want to know about is, what are you claiming for, what happened, and provide the documentation you need to be able to prove the claim. So we keep it as simple and streamlined as possible.”
In other areas, FWD has built in a number of unique features into its insurance offerings. For car owners with a 50% no claims discount(NCD), they would be granted a Lifetime NCD guarantee when they purchase car insurance with FWD. For motorcycle owners, they would be granted the same if they have a 20% no claims discount.
“This is actually borne out of what I have seen in many other markets,” Broom explains. “If you have a look at the proper underwriting numbers, once someone has actually got a 50% NCD, they shouldn’t be penalized for an accident. They’ve already proven that they are a good driver.”
Closing the protection gap
One of the biggest differentiators for FWD is how its term life insurance product has been able to address the protection gap.
In 2012, the Singapore Life Insurance Association released the LIA 2011 Protection Gap Study conducted by Towers Watson, a global consulting firm. According to the findings, the average working adult in Singapore required an average protection of S$626,000 – approximately 10 times their annual salary – and only had a total life insurance coverage of $319,500 – just 5 times their annual salary. Including CFP contributions, that meant the average working adult in Singapore had a protection gap of about S$242,500, or 3.7 times of their annual income.
To help close the protection gap, FWD was the first to launch its term life insurance product with a sum assured of up to $3 million that was fully sold online.
“I don’t like to think about it as selling term life insurance online. It is term life insurance that can be bought online. That’s a big difference,” said Broom. “Traditionally you go through financial advisors, and insurance policies will be sold to you. We have been able to make information available at the click of a button, allow customers to search, compare, and then choose easily.”
ZUU Online attempted to get a quote for a term life insurance policy on FWD’s website, and by filling in 5 fields, was able to immediately determine that a 30 year old non-smoking male would need to pay $2,749.99 annually to get a fixed term policy with a $1.5 million sum assured, and with coverage for total permanent disability and critical illness.
“If you can get a quote in 10 seconds, work out your need, and you don’t have any of the hassle of having been sold to, or having to get medical tests for policies up to $1.5 million, more people will start to plug that gap,” said Broom.
Investing in customer-centric technology
Incidentally, Broom’s customer-centric business approach has spilled over to his investments, which are primarily in buying and renting properties in the UK. But now, Broom wants to invest in cryptocurrencies.
“Everything I have done in my career today, has been focused on customer experience and using digital to build customer experience. And bitcoin was the first cryptocurrency that fundamentally changed online purchases,” Broom explained thoughtfully.
“Granted, those purchases were for products that people shouldn’t be buying, but it was leap forward in technology. Now with everything that is going on in blockchain technology, it’s going to fundamentally change financial services and insurance in the future.”
“Then you read articles about how if you bought $100 of bitcoin 7 years ago, that $100 is now worth $72.8 million,” he said with a laugh. “Odds are, that’s never going to happen again and cryptocurrency is highly volatile. But maybe it is something I can have a little bit of fun with, with money that I am prepared to lose.”