You are now the Chief Marketing Officer of a brand-new insurer in Hong Kong. As approaching to its 1-year birthday, a new product initiative and marketing program are agreed to launch in the next six

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

Fin an cia l S erv ic es

A s t h e CO VID 19 c ris is e vo lv e s, it w ill c o ntin ue t o a ect in su ra n ce

d is tr ib utio n a ro un d t h e w orld . I n su re rs c a n p re p are b y b uild in g a

s tr a te g y f o cu se d o n n ear- a n d lo ng -te rm im plic a tio n s.

T

he C O VID 19 p an d em ic is p ro fo un d ly a ectin g h ow p eo p le e n g ag e w it h o ne

an oth er a cro ss in d ustr ie s a n d g eo g ra p hie s. P hys ic a l d is ta n cin g a n d o th er

q uara n tin e m easu re s h ave s h if t e d a ctiv it ie s o nce c o nsid ere d c rit ic a l t o h ave in p ers o n

to d ig it a l a n d r e m ote c h an nels . T h is c h an g e w ill a ect in su ra n ce d is tr ib utio n— both in

t h e n ear t e rm , a s p hys ic a l d is ta n cin g m easu re s c o ntin ue, a n d in t h e lo ng er t e rm .

In d eed , s o cie ty ’s r e la tio nsh ip w it h t e ch n olo g y a n d r e m ote in te ra ctio ns is c o ntin uo usly

e vo lv in g a n d a cce le ra tin g a s w e m ove t o w ard t h e “ n ext n orm al .”

S ave t h is a rtic le

D O W NLO AD S

 Artic le ( P D F6 31K B )



By S im on K ae sle r, M att L eo , S han non V arn ey , a n d K ait ly n Y o un gHow i n su ra n ce c a n p re p are f o r t h eH ow i n su ra n ce c a n p re p are f o r t h e

nex t d is tr ib u tio n m od eln ex t d is tr ib u tio n m od el Ju n e 1 2 , 2 0 20Ju n e 1 2 , 2 0 20 | A rtic le| A rtic le 7/2/2021 How insurance can prepare for the next distribution model | McKinsey

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Man y in su ra n ce c o m pan ie s h ave lik e ly a lr e ad y t a ke n s te p s t o a d dre ss s h o rt- te rm o r

im med ia te im pacts o f CO VID 19 — movin g e m plo ye es t o a r e m ote s e tu p a n d e xp an d in g

onlin e c u sto m er s e rv ic e c h an nels . N ow , in su re rs a re f o cu se d o n t h e n ext s e t o f

ch alle n g es, in clu d in g h ow t o r e im ag in e d is tr ib utio n in a m ore r e m ote w orld . A n A pril

2 0 20 s u rv e y o f G erm an in su ra n ce a g en ts (c o nd ucte d f o ur w eeks in to lo ck d ow n) f o un d

th at a b out h alf o f t h e a g en ts s a w a m ore t h an 4 0 p erc e n t d ecre ase in n ew b usin ess.

A nd a M ay 2 0 20 s u rv e y o f U S a g en ts f o un d a s im ila r e ect: a lm ost 5 0 p erc e n t o f

ag en ts c it e d r e m ote ly b uild in g n ew c u sto m er r e la tio nsh ip s a s t h e b ig gest c h alle n g e

durin g CO VID 19 . M ean w hile , o nlin e in su ra n ce a g gre g ato rs a n d d ir e ct c h an nels a re

re p ortin g s im ila r, if n ot g re ate r, v o lu m e .

To a d dre ss t h ese c h alle n g es, in su re rs w ill n eed t o r e th in k th eir d is tr ib utio n m od el

acro ss t h re e d im en sio ns: c u sto m ers , s a le s f o rc e , a n d e n ab le rs (s u ch a s in ve stm en t in

d ata a n d d ig it a l t o ols ). D oin g s o w ill e m pow er t h em t o p re p are f o r t h e u n p re d ic ta b le .

H ow d is tr ib ution i s c h an gin g

Phys ic a l s a le s f o rc e s a n d in te rm ed ia rie s a re r e sp onsib le f o r t h e m ajo rit y o f in su ra n ce

d is tr ib utio n a cro ss g eo g ra p hie s a n d lin es o f b usin ess. W hile t h e s h are o f b usin ess

c o nd ucte d v ia t h ese c h an nels h as b een s h if t in g d urin g t h e p ast d eca d e a s s o m e

cu sto m ers m ig ra te o nlin e, t h ey r e m ain t h e p rim ary c h an nels a cro ss lif e , c o m merc ia l,

a n d p ers o nal lin es p ro p erty a n d c a su alt y .

[1]

[2]How  c o m pan ie s a n d  le ade rs  c a n  r e se t f o r  The N ex t N orma l Special  C olle ctio n 7/2/2021 How insurance can prepare for the next distribution model | McKinsey

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But c o ntin ued p hys ic a l d is ta n cin g is h avin g d ra m atic a n d im med ia te im pacts o n

in su ra n ce d is tr ib utio n.

S hif t in g t o d ig it a l t o ols . A gen ts a ccu sto m ed t o in -p ers o n in te ra ctio ns a re r a p id ly

r e ca lib ra tin g t o p ro vid e u n in te rru p te d s e rv ic e t o c lie n ts w ho m ay b e f a cin g s e ve re

h ealt h o r e co nom ic c h alle n g es. T h ese a g en ts a re a ls o r e th in ki ng h ow t h ey b uild

r e la tio nsh ip s w it h p ro sp ectiv e c lie n ts a s m ost r e ly o n in -p ers o n m eetin g s. I n o ur

Ja n uary 2 0 20 U S a g en t s u rv e y, a b out 9 0 p erc e n t o f lif e in su ra n ce a g en ts ’ s a le s

co nve rs a tio ns a n d n early 7 0 p erc e n t o f t h eir o ng oin g c lie n t c o nve rs a tio ns w ere

c o nd ucte d in p ers o n. In a f o llo w -u p s u rv e y in M ay, le ss t h an 5 p erc e n t o f a g en ts h ad

a n y in -p ers o n c o nve rs a tio ns. A la te -A pril 2 0 20 s u rv e y o f E uro p ean in su ra n ce

e xe cu tiv e s f o un d t h at s o m e 8 9 p erc e n t o f r e sp ond en ts e xp ect s ig ni ca n t a cce le ra tio n

in d ig it iz a tio n, a n d m ost a ls o a n tic ip ate f u rth er s h if t in c h an nel m ix . T h e CO VID 19

p an d em ic h as in cre ase d c u sto m ers ’, a g en ts ’, a n d in su re rs ’ d esir e f o r c o m fo rt a ro un d

d ig it a l- a n d r e m ote -in te ra ctio n m od els a n d t o ols .

M ovin g t o w ard s e lf - s e rv ic e . Cl ie n t d em an d f o r s e lf - s e rv ic e in t h e c u rre n t e nvir o nm en t

h as o nly a cce le ra te d t h e im porta n ce o f d ig it a l. A r e ce n t c o nsu m er s u rv e y in S pain f o un d

d ig it a l a cce ss in in su ra n ce h as in cre ase d a lm ost 3 0 p erc e n t s in ce t h e p an d em ic b eg an .

B ut t h e s a m e s u rv e y a ls o f o un d t h e le ve l o f c u sto m er s a tis fa ctio n w it h d ig it a l d eliv e ry in

in su ra n ce w as t h e lo w est c o m pare d w it h a ll o th er s e cto rs . T h e n um ber o ne r e aso n f o r

d is sa tis fa ctio n w as “ h ard -to -u se t o ols .” T h us, in su re rs w ill n eed t o in ve st in

e xp an d in g a n d im pro vin g s e lf - s e rv ic e t o o ls t o b ette r s u p port c u sto m er a n d a g en t

sa tis fa ctio n.

Tra n sit io n in g o in e p ro ce sse s o n lin e. A gen ts a re c u rre n tly n avig atin g le g acy

p ro d ucts t h at s o m etim es r e q uir e o in e e xe cu tio n, s u ch a s p hys ic a l s ig natu re s a n d

m ed ic a l u n d erw rit in g . O ur J a n uary 2 0 20 U S a g en t s u rv e y r e su lt s s h ow t h at a lm ost 5 0

perc e n t o f a g en ts w ere d is sa tis ed w it h t h e le ve l a n d fu nctio n o f s ig natu re c a p ab ilit ie s

[3]

[4]

T he g oa l i s t o re tu rn t h e b u sin ess t o s c a le f a st, e sp ecia lly a s k n oc k-on eff ects o f

th e v ir u s b ecome c le a r. 7/2/2021 How insurance can prepare for the next distribution model | McKinsey

https://www.mckinsey.com/industries/financial-services/our-insights/how-insurance-can-prepare-for-the-next-distribution-model 4/9

at t h eir p rim ary c a rrie r. M an y c u sto m ers , m ean w hile , c u rre n tly d o n ot w an t t o e n g ag e in

a p hys ic a l m ed ic a l- u n d erw rit in g p ro ce ss f o r f e ar o f c o nta g io n. I n su re rs m ust t h en

ra p id ly nd w ays o f d ig it a lly u n d erw rit in g t h e b usin ess— su ch a s m aki ng b ette r u se o f

exte rn al d ata , r e ly in g o n s ta te m en ts o f g ood h ealt h , a n d a d ju stin g uid le ss t h re sh o ld s

to e xp an d t h e n um ber o f c u sto m ers w ho c a n f o rg o a p hys ic a l m ed ic a l e xa m — or r is k

lo sin g it .

Ch an gin g d is tr ib ution str a te g y i n t h e

nea r t e rm

By n ow m ost in su ra n ce c o m pan ie s a re t h in ki ng a b out h ow t h ey s h o uld p re p are d urin g

th e n ear t e rm t o b e r e ad y f o r t h e n ext n orm al; m an y o f t h ese s te p s t o w ard d ig it a l

d is tr ib utio n a re u n p re ce d en te d . T h eir f o cu s is m ostly o n d ig it a lly e n ab li n g s a le s f o rc e s

an d e n han cin g t h e u se o f d ata a n d a n aly tic s— esp ecia lly f o r le ad g en era tio n— to

s u p port c u sto m ers .

In su re rs  c a n d i ere n tia te t h em se lv e s in t h e e vo lv in g d is tr ib utio n la n d sc a p e d urin g t h e

n ext s e ve ra l m onth s b y m ovin g q uic kl y t o p il o t, t e st, a n d le arn r a th er t h an f o cu s o n

m ult im onth s tr a te g y e orts ; g ettin g s ta rte d is b ette r t h an w ait in g f o r p erfe ctio n. T h e

g oal is t o r e tu rn t h e b usin ess t o s c a le f a st, e sp ecia lly a s kn ock-o n e ects o f t h e v ir u s

b eco m e c le ar. I n su re rs s h o uld f o cu s a ctio ns a cro ss t h re e a re as: c u sto m ers , s a le s f o rc e ,

an d e n ab le rs .

T ak e c a re of y o u r c u stome rs

To u n d ers ta n d h ow c u sto m er p re fe re n ce s h ave c h an g ed , in su re rs c a n u se z e ro -b ase d

d esig n t o r e th in k exis tin g p ro ce sse s, e xp erie n ce s, a n d p ro d ucts t o b e m ore a p p ro p ria te

fo r t h e n ext n orm al. T h is m ay m ean s im plif y in g p ro d ucts f o r r e m ote s a le s; f o r

exa m ple , o ur r e se arc h h as f o un d t h at m an y t r a d it io nal in su ra n ce p ro d ucts a re t o o

[5] 7/2/2021 How insurance can prepare for the next distribution model | McKinsey

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co m ple x f o r d ig it a l s a le s (e ve n w it h in str u ctio ns). M ore b ro ad ly , u n d ers ta n d in g h ow t o

r e -c re ate t h e e ectiv e n ess o f a n in -p ers o n, a d vic e -b ase d r e la tio nsh ip b etw een

su cce ssfu l a g en ts a n d t h eir c u sto m ers in a v ir tu al e nvir o nm en t w ill b e k e y. I n su re rs  c a n

lo ok to a d va n ce s in t e le m ed ic in e— whic h h ave s e en a d ra m atic u p tic k in r e ce n t w eeks—

w it h r o ug hly h alf o f t h eir c u sto m ers in te n d in g t o c o ntin ue u sin g t h e s e rv ic e a ft er t h e

cris is s u b sid es. Te le m ed ic in e t o ols (s u ch a s v id eo f o r c o nd uctin g a p poin tm en ts a n d

p hoto - o r s c re en -s h arin g ) c a n h elp r e -c re ate c o m ple x, a d vic e -b ase d c o nve rs a tio ns

vir tu ally w hile a ls o p ro te ctin g c o nsu m er p riv a cy a n d s e cu rit y .

T ak e c a re of y o u r s a le s f or ce

To p re p are t h e s a le s f o rc e f o r t h e n ext p hase , in su re rs  c a n f o cu s o n t h re e im pera tiv e s.

L a u n ch a r e m ote -o n ly d is trib utio n f o rc e . I n te re st in r e m ote d is tr ib utio n f o rc e s h as

in cre ase d in r e ce n t y e ars a n d is e ve n m ore r e le va n t n ow . R em ote s a le s f o rc e s h ave

e co nom ic a d va n ta g es f r o m a n in su ra n ce p ers p ectiv e : t h ey g en era lly a llo w a g en ts t o

s e rv e s ig ni ca n tly m ore c u sto m ers t h an t r a d it io nal a g en ts , r e su lt in g in lo w er

co m mis sio n c o sts p er s a le . F urth er, r e m ote f o rc e s a ls o a llo w in su ra n ce c o m pan ie s t o

o w n t h eir s a le s m essa g es m ore d ir e ctly , e n han cin g t h eir a b il it y t o r e sp ond c o hesiv e ly in

a c ris is . I n d eed , in su re rs  c a n q uic kl y u p date r e le va n t s c rip ts a n d t a lki ng p oin ts a n d

m ore c lo se ly m an ag e p erfo rm an ce t o e n su re c o m pli a n ce . I n su ra n ce c o m pan ie s t h at

h ave e ectiv e h yb rid d is tr ib utio n f o rc e s m ay n ot n eed t o w orr y a b out in ve stin g in a

s ta n d -a lo ne r e m ote s a le s f o rc e in t h e lo n g t e rm . B y u sin g in te rn al s a le s d esk s a n d

hyb rid a g en ts ( t h at u se b oth in -p ers o n a n d d ig it a l c h an nels ) o r w ho le sa le rs , in su re rs

th at d o n ot y e t h ave r e m ote o r h yb rid s a le s f o rc e s c a n t r a n sit io n r e m ote c a p ab ilit ie s t o

t h eir s ki lle d eld s a le s t e am s t h at a re lik e ly m ore e xp erie n ce d in c lo sin g d eals a n d

b uild in g r e la tio nsh ip s.

E m phasiz e j o in in g a t e am . W hile t h ere is m uch d is c u ssio n a b out t e am in g b etw een

in su re rs  a n d a g en ts , o ur J a n uary 2 0 20 U S a g en t s u rv e y f o un d a b out 2 0 p erc e n t o f lif e

a g en ts h ave n eve r w ork e d w it h a n y t e am , d esp it e e vid en ce t h at a g en ts in t e am s a re

[6] 7/2/2021 How insurance can prepare for the next distribution model | McKinsey

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sig ni ca n tly m ore p ro d uctiv e . CO VID 19 h as s h ow ed t h e v a lu e o f s o m e s y ste m

re d un d an cy ( t h at is , m ult ip le a g en ts a b le t o a cce ss in fo rm atio n o n o ne c lie n t) t o e n su re

c o ntin ued o p era tio ns s h o uld a g en ts b eco m e s ic k. F urth erm ore , t e am in g b rin g s

to g eth er a g en ts w it h d i ere n t p ro d uct e xp ertis e , w hic h h elp s s a le s f o rc e s b ette r s e rv e

d iv e rs e c u sto m er n eed s.

In su ra n ce c o m pan ie s s h o uld e n su re t h eir c o m mis sio n s y ste m s u p ports t e am in g b y

allo w in g s p lit - c o m mis sio n p aym en t o r o th er in ce n tiv e s f o r jo in t w ork. I n su re rs a ls o n eed

to m ake s u re d i ere n t a g en ts c a n a cce ss t h e s a m e c u sto m er d ata a n d c o lla b ora te

t h ro ug h c u sto m er- in fo rm atio n-s h arin g t o ols . F in ally , in ve stin g in v ir tu al t r a in in g o n

te am in g b est p ra ctic e s, s h arin g t h e nd in g s w it h a g en ts , o r a ski ng t o p a g en ts w ho

alr e ad y w ork in t e am s t o s h are t h eir in sig hts w it h o th ers in t h eir n etw ork ca n a ls o h elp

s u p port t h is e n d eavo r.

E xp an d d is trib utio n p art n ers h ip s. A s t h e c u rre n t e nvir o nm en t p la ce s a n e ve n g re ate r

p re ssu re o n m aki ng s a le s, n ow c o uld b e a g ood t im e t o t h in k ab out in su ra n ce

m ark e tin g o rg an iz a tio ns o r a nit y r e la tio nsh ip s. E xp an d in g d is tr ib utio n p artn ers h ip s

co uld h elp t h e s a le s f o rc e p ro vid e p ro d ucts t o m ore c u sto m ers in n eed w hile

m ain ta in in g s a le s v o lu m e in a t im e o f c ris is . T h is a p pro ach b eco m es in cre asin g ly

im porta n t a s a v ir tu al- a g en t m od el in cre ase s t h e p re ssu re o n a g en ts t o a d d v a lu e.

I n vest in e n ab le rs

In ve stin g in d ig it a l d is tr ib utio n n ow w ill h ave s e ve ra l im porta n t b en e ts f o r in su re rs ,

in clu d in g in cre asin g r e silie n ce t h ro ug h a p ote n tia lly p ro lo ng ed o r m ult iw ave c ris is ,

re sp ond in g q uic kl y t o c u rre n t a n d f u tu re c u sto m er a n d a g en t d em an d , a n d in cre asin g

ag en t p ro d uctiv it y . A gen t a p petit e f o r d ig it a l t o ols h as n eve r b een g re ate r; o ur M ay

su rv e y o n U S a g en ts d urin g t h e c ris is f o un d t h at 4 4 p erc e n t o f a g en ts r a te d e it h er

ag en t d ig it a l t o ols o r c u sto m er t o ols a s t h e n um ber o ne c a p ab il it y in su re rs  c a n in ve st in

t o s u p port t h em r ig ht n ow . I n su ra n ce c o m pan ie s c a n s u p port a g en ts in t h is a re a. 7/2/2021 How insurance can prepare for the next distribution model | McKinsey

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Befo re in ve stin g in d ig it a l, in su re rs  s h o uld a sse ss a n d id en tif y g ap s in t h e id eal

cu sto m er a n d a g en t jo urn ey f o r t h eir s p eci c b usin ess. T h e nd in g s w ill h elp t h em

d eve lo p a n a g ile r o ad m ap t a ilo re d t o t h eir s tre n g th s a n d v u ln era b il it ie s s o t h ey c a n

b eg in c lo sin g t h o se g ap s.

A noth er im porta n t e n ab le r in d is tr ib utio n is d ata . I n su ra n ce c o m pan ie s t y p ic a lly h ave

m assiv e a m ounts o f d ata lo ck e d in le g acy s y ste m s o r in p ap er le c a b in ets . T h e f a ste r

in su re rs b uild o ut c a p ab ilit ie s t o m in e d ata s o t h at t h ey c a n id en tif y a n d r e sp ond t o

c u sto m er t re n d s, t h e m ore r e silie n t t h eir d is tr ib utio n m ech an is m w ill b eco m e. T h e v a lu e

of d ata -d riv e n le ad g en era tio n h as b eco m e in cre asin g ly c le ar in r e ce n t w eeks a s t h e

ty p ic a l in -p ers o n le ad g en era tio n a p pro ach es ( in clu d in g in -p ers o n n etw orki ng e ve n ts

a n d c o m mun it y e ve n ts ) o f m an y a g en ts a re n o lo ng er a n o p tio n. T o t a p in to t h e v a lu e o f

th eir d ata , in su re rs  c a n b uild a d va n ce d a n aly tic s m od els t o id en tif y lif e tim e v a lu e-b ase d

cu sto m er s e g m en ts w it h in t h eir c u rre n t p ortfo li o . T h ey c a n t h en b uild a d dit io nal m od els

f o r e ach s e g m en t t o id en tif y c u sto m ers a t r is k of c h urn in g o r la p sin g a s w ell a s

cu sto m ers w ho m ig ht b e c a n d id ate s f o r c ro ss-s e ll in g o r u p se ll in g o p portu n it ie s. T h e

d ata c a n t h en b e in te g ra te d in to c a ll lis ts t o h elp a g en ts ( lo ca l o r r e m ote ) f o cu s t h eir

a tte n tio n o n t h e h ig hest v a lu e le ad s. I n su re rs  s h o uld a ls o b uild a f e ed b ack m ech an is m

to f u rth er r e ne t h e m od el b uild in g v ia q ualit a tiv e in p ut fr om a g en ts a s w ell a s

co nve rs io n d ata .

O ur J a n uary 2 0 20 s u rv e y a ls o r e ve ale d a lm ost 3 0 p erc e n t o f a g en ts s a id t h eir b ig gest

c h alle n g e r ig ht n ow w as le ad g en era tio n , w it h ju st u n d er 6 0 p erc e n t o f a g en ts w illin g t o

p ay b etw een 0 .5 a n d 2 .0 p erc e n t o f t h eir g ro ss in co m e f o r q ualit y le ad s. O nly 2 0

perc e n t o f a g en ts h ave s e en a n in cre ase in le ad s c o m in g fr om t h eir in su ra n ce

co m pan ie s in A pril, s u g gestin g a n o p portu n it y f o r in su re rs  t o in ve st in d ata a n d

p ro activ e ly ll t h at n eed f o r a g en ts .

P la n nin g f or t h e long er t e rm 7/2/2021 How insurance can prepare for the next distribution model | McKinsey

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Beyo nd t h e s h o rte r t e rm , in su ra n ce c o m pan ie s m ust c o nsid er t h re e a ctio ns a s t h ey

re eva lu ate t h eir lo ng er- te rm d is tr ib utio n s tr a te g y a n d lo ck in d is tr ib utio n s h if t s t o w ard

d ig it a l.

D ecid e o n t h e o p tim al g o-fo rw ard c h an nel m ix . I n -p ers o n a g en t f o rc e s w ill r e m ain a n

im porta n t p art o f t h e d is tr ib utio n la n d sc a p e in t h e y e ars t o c o m e, e sp ecia lly in lif e a n d

la rg e c o m merc ia l. B ut in su ra n ce c o m pan ie s n eed a s e tu p t h at in clu d es d ig it a l- a n d

re m ote -s a le s-fo rc e o p tio ns t o s e rv e c u sto m ers w ho p re fe r d ig it a l o r r e m ote

in te ra ctio ns. H avin g t h is exib le w orkf orc e in cre ase s r e sil ie n ce in t h e f a ce o f a n

u n kn ow n f u tu re . S ettin g u p a r e m ote a g en cy c a n b e d one q uic kl y t h ro ug h a p il o t- te st-

a n d -le arn a p pro ach , g ettin g r e m ote a g en ts t o in te ra ct w it h c u sto m ers , a n d r e nin g

p ro ce ss b ase d o n f e ed b ack.

Id en tif y r e q uir e d m od i ca tio n s a n d n ew t e ch nolo g ie s t o s u p port t h e n ext n orm al.

L ead in g c a p tiv e -d is tr ib utio n in su re rs t h at s e e t e ch a n d d ig it a l a s c o re d i ere n tia to rs o r

th e e sse n ce o f t h eir v a lu e p ro p osit io n s h o uld c la rif y t h eir d esir e d a d ju stm en ts t o t h eir

e xis tin g t e ch s e tu p . T h ese m od i ca tio n s a re e sp ecia lly im porta n t w hen e n ab li n g t h e

ag en t c h an nel t o o p era te in a m ore d ig it a l p ostp an d em ic w orld . T o ols t o in cre ase d ig it a l

p ro sp ectin g a n d b uild t r u st in in it ia l c o nve rs a tio ns a re k e y t o h elp in g a g en ts r e p la ce

th eir t y p ic a l o in e in te ra ctio ns. T o d eve lo p t h e t e ch r o ad m ap t o t h e n ext n orm al,

in su re rs s h o uld w ork wit h a g en ts t o id en tif y t h e b ig gest o b sta cle s t h at c u rre n tly

im ped e p ro d uctiv it y a n d r a p id ly d eve lo p t h e m ost v ia b le p ro d uct s o lu tio ns t o c lo se

th o se g ap s. O ur a g en t s u rv e y id en ti ed s ig natu re s, a p plic a tio n a n d s u b m is sio n f o rm s,

a n d c lie n t o nb oard in g a s p ro ce sse s t h at a g en ts m ost w an t t o s e e d ig it iz e d .

B e r e ad y t o m ake s tra te g ic M &A d ecis io n s t o a u g m en t d is tribu tio n . F in te ch s a n d

in su rte ch s a re lik e ly t o b e m ore o p en t o c o nve rs a tio ns w it h in su re rs  w it h la rg e b ala n ce

sh eets b eca u se o f t h e nan cia l im pact o f t h e c ris is . I n su ra n ce c o m pan ie s s h o uld

p ro activ e ly id en tif y g ap s in t h eir d is tr ib utio n e co sy ste m a s w ell a s p ote n tia l

p artn ers h ip s a n d a cq uis it io ns t h at c o uld o er a ve n ues t o n ew c u sto m er t y p es (s u ch a s

d ig it a l n ativ e s), n ew p ro d uct t y p es (s u ch a s b ro ad er p ro te ctio n p ro d ucts ), o r n ew

g eo g ra p hie s. 7/2/2021 How insurance can prepare for the next distribution model | McKinsey

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1. M cK in se y G erm an I n su ra n ce A gen ts S urv e y, c o nd ucte d o nlin e in A pril 2 0 20 ; n = 1 0 0.

2. M cK in se y CO VID 19 U S I n su ra n ce A gen t P uls e S urv e y, c o nd ucte d o nlin e in M ay 2 0 20 ; n = 3 41.

T h is s u rv e y w as a f o llo w -u p t o a J a n uary 2 0 20 s u rv e y o f 1 ,3 0 0 a g en ts ( b efo re CO VID 19 w as

d ecla re d a p an d em ic ). B oth s u rv e ys in clu d ed in d ep en d en t a n d c a p tiv e a g en ts a cro ss c a rrie rs a n d

b usin ess lin es ( p ers o nal, c o m merc ia l, a n d lif e a n d nan cia l p la n nin g ).

3 . M cK in se y U S I n su ra n ce A gen t S urv e y, c o nd ucte d o nlin e in M ay 2 0 20 ; n = 1 ,3 0 0.

4. M cK in se y M ark e tin g & S ale s CO VID 19 D ig it a l S en tim en t A naly s is f o r S pain ; n = m ore t h an

1,0 00, s a m ple d a n d w eig hte d t o e n su re r e p re se n ta tio n o f e xis tin g d ig it a l u tiliz a tio n.

5 . For m ore o n u sin g z e ro -b ase d d esig n t o im pro ve c u sto m er e xp erie n ce , s e e J P H ig gin s,

E lix a b ete L arre a, S w ap nil P ra b ha, A le x S in g la , a n d R ohit S ood , “ H ow t o e xtr a ct m axim um v a lu e

fr o m a z e ro -b ase d d esig n a p pro ach t o c u sto m er jo urn eys ,” J a n uary 2 0 19 .

6 . Forty -e ig ht p erc e n t o f c u sto m ers n ow u se a t e le m ed ic in e p la n t o c o ntin ue (a s o f A pril 2 6 ,

20 20 ). F or t h e la te st o n U S c o nsu m er s e n tim en t d urin g t h e CO VID 19 c ris is , s e e “ S urv e y: U S

co nsu m er s e n tim en t d urin g t h e c o ro navir u s c ris is ,” M ay 2 0 20 .

A B O UT T H E A U TH O R(S )

Sim on K ae sle r is a p artn er in M cK in se y’s F ra n kf urt o ce , M att L e o is a n

asso cia te p artn er in t h e N ew Y o rk o ce , a n d Sh an non V arn ey is a p artn er in

t h e B osto n o ce , w here K aitly n Y o un g is a n a sso cia te p artn er.

T h e a u th o rs w is h t o t h an k Ale x D’A m ic o , J o nath an G od sa ll, A rie lle P en sle r,

N eh a S ah g al, a n d J ill Z uck e r f o r t h eir c o ntr ib utio ns t o t h is a rtic le .

Ch an g in g t h e d is tr ib utio n o p era tin g m od el w ill t a ke t im e t o im ple m en t, s in ce it n ot o nly

m ean s e m plo yin g n ew t o ols a n d a sse ts b ut a ls o r e q uir e s s u b sta n tia l c a p ab il it y b uild in g

th at a ects o th er p arts o f t h e v a lu e c h ain , s u ch a s p ro d ucts a n d c la im s. T h e d is tr ib utio n

le ad ers t h at w ill le ad in t h e n ext n orm al w ill b e t h e o nes b eg in nin g w ork on t h e lo ng er-

t e rm im pera tiv e s t o d ay.