How to achieve a single customer view in insurance

Helen Richardson, senior product manager, UK and Ireland, LexisNexis Risk Solutions, Insurance, explores the challenges of integrating customer data in the insurance sector.

Customer data management (CDM) has not been without its challenges in the general insurance market due to switching, the number of policies we hold over a lifetime (home, car, travel, pet and so on), along with life events have all conspired to make the ‘single customer view’ problematic at best and elusive at worst.

But this view is now within the grasp of marketers working in the insurance sector thanks to data linking engines that enable disparate data to be resolved down to a single, consolidated customer record. A record that updates over time and can be used right across the insurance business, not least within the marketing function.

Record numbers shopped and switched

The complexity of making customer data workable for insurance marketers comes down to a number of factors. First, there is the rate of policy churn in personal lines. For example, record numbers of consumers shopped for and switched motor insurance in 2024 based on the LexisNexis® Risk Solutions Insurance Demand Meter U.K.

Combine this with elevated merger and acquisition activity, the on-going problem of legacy systems and the fact that data is often held in separate customer databases throughout an insurance brand, and the challenge is evident.

The result is that customer data can become out of date, inaccurate and inconsistent. The same customer could then appear multiple times within one or multiple databases in one insurance organisation with no relationship between records being created. They may have different names or addresses because of input errors, a home move or marital status change. This can lead to inefficient and ineffective marketing efforts as well as missed cross-sell and upsell opportunities. It also makes in-house efforts to link, match and de-duplicate very challenging.

This is all in addition to the fraud risk, impact on accuracy of pricing and poor customer experience this can create, not forgetting the regulatory pressure on insurance providers to make certain that the products and services sold and marketed to their customers are correct and suitable to their needs and demands.

Customer engagement beyond policy inception

Another issue to consider is that insurance providers have not typically had much opportunity to talk with their customers throughout the policy term. Home and motor insurers may only communicate with customers once or twice a year in some cases. This dynamic can impede an understanding of the customer’s individual needs and what motivates their choice to stay or switch insurers at renewal.

However, opportunities for customer interaction are changing with mobile apps and vehicle connectivity, offering brands the chance to engage throughout the term of the policy.  For example, LexisNexis® Risk Solutions is helping to enhance Kia’s connected vehicle ecosystem with a consumer-friendly, risk-based driving score into Kia Europe’s newly updated app. This is empowering Kia owners that select the service with deeper insights into their driving behaviour and the opportunity to access more personalised insurance offerings.

Developments such as this are exciting for marketers but, ultimately, more effective marketing lies in creating a single customer view, enabling insurance marketers to have a proper and precise understanding of the customer. This single customer view can be utilised to make the decision that the right product is being marketed for the risk. Most importantly, this also helps ensure that the marketing communications and strategies are occurring at the right points in the policy life cycle.

Data linking engine

The path to that single customer view is now not as difficult as it once was. Rather than attempting to match customer records in house, a data linking engine can look for common threads across customer records to resolve these down to one ‘golden’ record for the customer that offers a comprehensive view of all contact the insurance company has had with the individual. This then becomes the foundation upon which all future business with the customer is conducted, across all functions, not least marketing.

Marketers can know with confidence that Ms. Smith who has just applied for caravan insurance had two pet policies, one motor and three home policies with different brands within their business over the past 7 years, each renewed within a month of the policy renewal date. They can also see that Mrs. Smith has never had a claim against any of those policies, she has recently moved homes and has married and changed her name to Mrs. Smith-Jones.

Unique and Persistent Identifier

The success of finding those threads and matching customer records lies in the wide variety of external sets of data, including public records and proprietary data gathered from across the marketplace, which are used in the matching process. Where customer records match, they are merged and subsequently assigned the same unique identifier. This can be done in batch mode for all the existing customer records and at quote time so that new customers are also given a unique identifier.

By combining data about an individual policyholder, marketers can better engage in the way the customer prefers and offer relevant and tailored products and services. Add data enrichment on their vehicle or property to the mix and they could understand when they may be replacing a car, or their MOT is due. They may also better understand the risk to that customer if a storm is going to reach their location and property.

In addition, customers identified as having more than one policy within a group could be offered a multi-product packaged deal.

Matching and connecting customer data with data linking engines make it possible for all segments of the insurance sector to understand and benefit from the vast amounts of customer data held across their business to identify cross-sell and upsell opportunities to the right customer at the right time.