Lessons from disrupting the insurance industry – for product managers
Today we are talking about creating disruptive products that challenge existing industries. A classic example of this is the digital camera that disrupted the film industry and contributed to the collapse of Kodak. Disruption occurs when we think of how a problem can be solved in a completely different way. It is typically accompanied by new technology or the application of technology in a novel manner. Our guest is creating disruption in a very old industry—insurance. His name is Konrad Heimpel and he is the VP of Product for GetSafe, based in Heidelberg, Germany.
Summary of some concepts discussed for product managers
[2:01] How did you become interested in disrupting the insurance industry?
I was born with a walking disability, and without the very good health insurance we have in Germany, my parents would not have been able to afford treatment for me. I’ve experienced the difference insurance can make in people’s lives. Insurance is a great achievement and a relevant challenge. It still has a bad reputation, and I want to help it have a good reputation and be accessible for everyone.
[5:15] What are you doing to disrupt the insurance industry?
At GetSafe, we’re making use of the megatrend we’ve seen over the last few decades: people using their smartphones to steer their lives. Insurance has not been fully digitized, but there is no reason it can’t be, because there are no physical goods being exchanged. We’ve built an app where people can buy and manage their coverage and make claims. We’re digitizing and simplifying insurance, making it more transparent, easier, and faster for customers.
We sell B2C and currently offer the app for a range of property and casualty (P&C) insurance.
[7:33] What makes your approach to insurance disruptive?
The app sounds simple but is quite complex. The insurance industry is highly regulated. Any transaction must be 100% traceable, unlike in most ecommerce industries. When someone buys insurance, we’re obliged to provide coverage, so we can’t lose any information. No matter how we iterate our platform, everything must be 100% backward-compatible. The regulations and need for backward compatibility make the coding behind the app very complex. Collecting data at every touchpoint and simplifying the user experience would be a huge effort for old insurance companies. That gives us an advantage.
[12:41] How are you using data?
We collect behavior data and customer feedback to improve the user experience. For example, on the app we explain what an insurance contract covers. We collect data as users read explanations and use that to optimize how we present information.
We also use data to recommend the right coverage, make better risk predictions, and provide better coverage.
[21:09] How do you discover how to make a better user experience?
The key is talking to users a lot and listening to their feedback. Many users are happy to give feedback, and we collect and analyze it and try to see patterns. If we see something we want to know more about, we jump on a call and talk to the user.
You can get valuable insights from talking to just five or six people. It’s crucial to talk to customer service. Insurance is complicated, and we still receive calls and emails every day from people asking questions about specific situations. We listen carefully to hear what they’re really asking. That’s our greatest source of information.
[25:34] As you scale, how do you decide which product features to implement and which ones to say no to?
I’m a huge fan of iterating fast and listening to feedback and data—put out a first version very quickly that solves at least part of the problem and then learn from it. It’s not a good practice to have 10 developers working for six months to build something big that doesn’t have any impact. On a daily basis, listening to customer feedback is the most important part of making feature decisions.
For our long-term strategy, we find indicators of good business outcome. For example, we predicted the customer lifetime value and tried to see correlations with important product metrics, like how does the processing speed of the claim correlate with the customer’s happiness and business outcome? We need data like these to make decisions that will provide value to the customer and to the business.
[29:16] What advice do you have for product managers who haven’t started working with data science yet?
As a product manager, you need to be good at balancing gut feeling and data. It’s your job to minimize uncertainty in your outcome and decide when you have enough data to make a decision. Be strict about using data, doing proper experiments, and measuring success. You need to be able to tell people how you moved the metrics. Have a plan for carefully measuring metrics before you start.
Useful links:
Innovation Quote
“If I had an hour to solve a problem, I’d spend 55 minutes thinking about the problem and 5 minutes thinking about solutions.” – Albert Einstein
Thanks!
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Product Mastery Now for Product Managers, Leaders, and Innovators