Insurance companies are going digital. Liechtenstein Life CEO Aron Veress recently commented on the insurer’s progress and challenges in a local newspaper.
Digitization is changing the insurance industry rapidly. The COVID pandemic has boosted digital trends, and recent cost pressures give companies another incentive to develop digital solutions.
Like the banking industry, insurance is also moving towards digital integration, including stakeholders like clients, brokers, and insurance companies on one platform. In an interview with a local newspaper, Aron Veress, CEO of Liechtenstein Life, said, “Unlike five years ago, we now have a sophisticated toolbox for brokers and relationship managers to react quickly and easily to different phases of clients’ lives – including geopolitical or macroeconomic changes.”
Veress explains that his institution is aiming for a 360-degree digital strategy. “We want to ensure full transparency for customers and make up-to-date information available as real-time as possible,” he said. “On the advisor side, it’s about making customer contact efficient. Portfolio shifts should be possible quickly and easily. In the operational area, scalability is enormously important to us to keep administrative costs low.”
Can smaller firms achieve faster progress than bigger firms?
Around 50,000 Swiss clients entrust their pension assets to Liechtenstein Life, although the differences between Switzerland and Liechtenstein are not great regarding how pensions are managed. One difference is that as Liechtenstein is a member of the European Economic Area (EEA), Liechtenstein-based companies have easier access to European investments, which helps to diversify investments. Also, Liechtenstein’s financial center enjoys a good reputation in Switzerland.
Another reason why clients might be interested in Liechtenstein Life, in particular, is that the company has made good progress in terms of digitization. “Like for many Swiss institutions, developing in this [digital] field is a lot of work for us, too,” said Veress. “But as a small life insurer, we can make visible progress faster and digitize the core of the insurance business.”
Trust remains a key challenge
Veress rightly points out that asset management is about trust, also in the digital space. Many companies, also beyond the financial industry, are not paying enough attention to that. As convenient as digital tools are, convenience is not always the most important consumer preference.
For example, insurers or banks that close branches and instead go digital could also offer personal services via hotlines. That won’t completely replace the service consumers get at physical branches, but at least it allows for a human connection.
It’s also crucial to create trust in the digital space. That starts with top-notch infrastructure and security and continues with social proof online, for example, via community building or external validation. In the end, what builds trust is the same offline as well as online: The integrity of a business and how it treats its customers.
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