“GDPR aims to give the ownership and control of data usage back to customers”
Something you read everywhere these days. Yet, many companies see the new GDPR rules as a hindrance fearing that stricter data-protection rules will limit what they can do in digital commerce.
A survey by Gemalto, a data-security vendor, found that almost 50 percent of customers worldwide are unlikely to shop or do business again with a company that has experienced a data breach in which personal information was stolen. In turn, research studies also show that the higher the confidence-level and trust regarding data, the more information consumers are willing to share.
Data will become evermore important in the future, especially in light of real-time and contextual information, and the European Union has taken the lead with the strictest regulatory framework to date: Bravo! An important step in the right direction.
A wind of change
Strict rules about how customer and employee data are used, directly applicable rules to all EU member states and citizens and thereby even affecting international companies with EU customers or operations. The fact that many companies are discussing the role of a data protection officer to oversee the GDPR control framework is a proof, that the regulation drives corporate consciousness.
All industries will be affected; some merely consider GDPR a compliance exercise, one, where the downside needs to be mitigated. Some organizations spot an opportunity with the new regulation to invest and advance their digital agendas. Yet, one of the potentially largest paradigm shifts could take place in the insurance industry.
New leveling of the playing field in Insurance
The incumbents from today, which have amassed huge amounts of data can no longer claim that this data is their own asset. Upon request, insurers will have to allow that these data will be transferred to a third party – maybe a young InsurTech.
Until today, the ‘experience or data asset gap’ gave traditional players a huge advantage, as their large customer base generated insights and most of their profits. And, out of convenience, customers simply shun away from switching given cumbersome processes.
“Driving customer consent will be the differentiating factor.”
The new GDPR regulation will enforce that insurers require a clear consent to process customer data and to communicate more often and clearer about the processing of these data – often noted as one of the biggest tests for the insurance industry. Now, it is not about ‘having you on my book for a long-time’, but about ‘engaging you smartly’ – an entire new playing field in insurance.
Our believe is that ‘taking the customer trustful along the journey, with a clear understanding of what their data will be used for and a clear understanding of the benefits of sharing their data is key.
Incumbents and InsurTechs alike need to deliver on the customer journey. The cushion of anchored profits from large portfolios will gradually erode. It will take time, but change is accelerating. And those companies will win, who are able to build trust with the customer and a journey, which demonstrates the value exchange in the consent process. In my view, best-practice will let the customer simply control their data.
A recent BCG/DLA Piper research in Germany, France, Spain, Italy and the UK found out that “consumer caution is generally increasing across age groups and countries” and that customers are “primed to suspect companies of misusing their data”.
The shift in lifestyle through technological innovation was and is still enjoyed by everyone.
Now, we are starting to realize the role and the value of our data !
– Utena Treves, VP Business Development & Strategy, wefox Group