Inguard became the first insurance company to accept bitcoin in 2013, according to an article penned by the company’s CEO in the Huffington Post, who says it was the right thing to do since consumers are demanding more from insurance companies.
Parker Beauchamp, CEO of Inguard, noted that two-thirds of consumers would purchase insurance online if they could, and when they do, they are barely satisfied with insurer websites.
These findings reflect the fact that insurers do not invest correctly in new technology. Companies do offer online quoting tools and flashy apps, but these things usually fail to improve the customer experience.
Technology should remove friction from the buying process and its effectiveness should be measured by customer satisfaction. Bitcoin, a decentralized payment method tracked on a blockchain, addresses these issues.
Inguard did not know how much bitcoin would grow when it began accepting it in 2013, but the company recognized the need to accept bitcoin due to the possibility that consumers would want to use it.
The company’s goal in accepting bitcoin was to set an example of the type of innovation it wanted the insurance industry to embrace. Accepting bitcoin was a way to embrace the mission of using technology that could make consumers’ lives easier.
The insurance industry is big, and in some fundamental ways, it is broken, according to Beauchamp.
The industry as a whole is unwilling to adopt technology that creates more value for the consumer. Doing so requires seeing beyond short-term profits, commissions and pleasing internal stakeholders.
One sign of this reality is the massive turnover in insurance premiums – 4% annual turnover – among a few big players. Because the premium turnover is so high and the industry is nonetheless profitable, the big players do not want to fundamentally change the customer experience.
Beauchamp does not believe the current situation will sustain itself since consumers are demanding more from companies in general. Companies like Amazon and Apple, which have focused strongly on customer service, are changing consumer expectations.
Upstarts are using technology to disrupt how the insurance industry works, and it is only a matter of time until business, as usual, goes away.
Bitcoin, according to Beauchamp, is critical to change.
He asked readers for input on what technologies will create consumer value.
Images from Shutterstock and LinkedIn.