Mobile's Role in Life Insurance Not Necessarily on the Consumer Side

Despite the growth in consumer adoption of smartphones, life insurance carriers don't see a necessity to develop transactional apps for the devices, Boston-based consultancy Celent says in its North American SnAppshot, Life Version report.

While life carriers have developed apps — Celent looked at 12 — most focus on providing consumers with data and media to research life coverage in general. It seems that life carriers mostly use the channel as a device to build brand awareness and desire for coverage in consumers. In short, it's a purely marketing endeavor, as opposed to a customer service one. Things like games and calculators are popular among life carriers. Because of this approach, more apps include ways to contact agents or carriers directly than allowing existing customers to adjust their data.

Celent explains this by noting that life insurance is a one-claim event, so there isn't as much need for instant access in order to use insurance services. However, customers find desirous the ability to use administrative services, such as address change, beneficiary change, policy details and bill pay, via mobile.

The real question from the survey, I believe is this: Will it become table stakes to provide, at the very list, app-based administrative access for all lines of insurance business, or is mobile-optimized website access enough? Here are some reasons I believe we will see more transactional apps from life carriers:

—App development and distribution costs are relatively low, and service-oriented architecture is already in place at most carriers for their websites' customer portals.

—As a consumer, I appreciate the ability to check in on my major financial service providers via mobile, and the one-tap-to-connect nature of an app makes me more likely to do so. I'm frustrated when certain functionality isn't available through that channel, too. I expect life carriers to go along with consumer sentiment in this way.

—The storage capacity of smartphones is only going to grow, so consumers will be more likely to keep a group of financial services apps on their phones, even if they're not used that often.

—Finally, I'm tracking right now a trend among life and annuities carriers toward using mobile computing more with agents and producers (a view which with Celent agrees.) With companies building mobile development departments to serve that cohort, it shouldn't be too difficult to develop "quick and dirty" apps that customers will appreciate in a pinch.

Nathan Golia is senior editor of Insurance & Technology. He joined the publication in 2010 as associate editor and covers all aspects of the nexus between insurance and information technology, including mobility, distribution, core systems, customer interaction, and risk ... View Full Bio