By Kyla Reed - April 17, 2024
Vibrant Credit Union: Breaking Industry Barriers with Embedded Lending
Growing competition is forcing banks and credit unions to rethink their revenue strategies. Read how one credit union used embedded
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Gain new customers by creating experiences and products quickly and easily
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The Chartered Institute of Insurance has some brutal news for the profession. You might think this is shocking. Just one in five customers across the United States, the United Kingdom, France, Germany, Italy, Japan and Switzerland consider insurers trustworthy. In the UK, two-thirds of consumers believe their insurer will do what it can to avoid having to hand over money. A remarkable figure, given 98% of claims of most categories are paid out. Only 17% would follow their insurer’s recommendation to update their payment plan – a wholesale rejection of the insurer as an reliable source of information.
The results?
Under-insurance is the prime symptom. In the UK one in four homes has no form of home insurance. In London the figure is 45 per cent. Fewer than one in three Brits has life insurance. It leaves families unprotected and vulnerable.
Low trust is also perilous for insurers. Consumers with a low sense of trust exhibit are flighty. Brands must compete on price, leading to wafer-thin mark-ups on policies with budget-grade coverage.
A Geneva Association survey points to low trust across generations. The survey covered 7 major economies, and found only quarter to a fifth of respondents were prepared to say they trusted their insurer. Worryingly, the trend slopes downward – the more consumers experience and learn about insurers the lower their trust.
This lack of trust may be attributed in part to a wider dissatisfaction with financial services. The Edelman Trust Barometer 2020 places financial services bottom of the league table of economic sectors, trusted by 57% of consumers.
Naturally, financial services have improved trust levels since the 2008 crisis – the data shows steady year-on-year increases in trust since the nadir, up +12 over the last eight years alone.
So what’s going wrong? A FintechOS whitepaper takes a deep dive into the root causes of the lack of trust in insurance. It also spells out the remedies. We’ve talked to leading companies from incumbents and start-ups, to accelerators and consultants, to get to the heart of the question for this report:
For more findings from our whitepaper, download from here. Stay tuned for more.
(to be continued)
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This article is part of a series of FintechOS articles on the insurance industry. For more findings on insurance, download our whitepaper.
FintechOS is the global leader in fintech enablement, on a mission to make fintech innovation available to every company. As the world grows increasingly complex, FintechOS strives to simplify and accelerate financial technology so anyone can build, launch, service, and expand new products in weeks, not months or years. The FintechOS platform empowers banks, credit unions, and insurers of any size to grow revenue, lower operating costs, and achieve a faster time to value without dependency on core infrastructure and costly tech talent. Headquartered in New York and London, FintechOS has partnered with some of the world’s best brands, including Groupe Société Générale, Admiral Group, Oney, eMag, Deloitte, EY, and PWC.