In one of our previous DIA interviews Volker Büttner of Generali argued that building successful ecosystems requires taking a customer perspective. We totally agree; at the end of the day customers are the single most important node in any ecosystem insurers can be part of. Customer engagement is fundamental. Steven Mendel, co-founder and CEO of Bought by Many, says insurers need to aim even higher. It is about being passionate about people and about using technology to empower customers as well as front-liners.

There are many niche markets that are not well served by high street insurance giants. Bought By Many builds communities of individuals who have similar but niche insurance needs. The company uses a combination of search engine optimization and social media to group together people who have similar insurance needs, such as diabetic travellers, Labrador owners or professional indemnity insurance for mobile hair dressers. Bought By Many was launched 6 years ago and is now (mid 2018) serving over 300 groups and more than 560,000 members. Their mantra reads ‘Better Insurance. For Everyone’.
Steven Mendel was one of the thought leaders who shared his vision at the 2018 edition of DIA Amsterdam. Expect a similar level of keynote speakers at the upcoming DIA edition. Just click on the banner below to find out more.

Apparently, Bought By Many really strikes the right chord among consumers as well as insurers. How do you succeed in really creating a win-win?
Steven: “We present requirements of a specific group to the insurance industry and negotiate on behalf of the group to bring them a better deal than they can get on their own. A better deal might be better pricing, it might be more tailored benefits, or it might be both. Once we bring the offer back to the group, individuals buy directly from the insurer on the better terms that Bought By Many negotiated for them. Yes, we’re really creating a win-win for everyone. Insurers only write the risks that they want, and members of Bought By Many get a better deal.”

We noticed see you recently posted a tweet asking your followers whether one is a Star Wars fan or a Star Trek fan. Could you reveal why this question is relevant for insurance executives and insurtech leaders?
Steven: “I find this question very interesting. Peter Thiel, the famous investor, stated that if you are a Star Wars fan, you are a capitalist, and, if you are a Star Trek fan, you are a communist. He argued that, because Han Solo started the whole Star Wars event with a debt to society, therefore he must be a capitalist. And the USS Enterprise in Star Trek provides everything for everybody. There is no currency at all. Therefore, that must be a communist film. I assume you are still wondering why this has got anything to do with insurance, so let me explain. Peter Thiel also said, in his book Zero to One, that computers are complements for humans, not substitutes. He then went on to explain that the most valuable businesses of coming decades will be built by entrepreneurs who seek to empower people, rather than try to make them obsolete.”

Ha ha – we must be Trekkies then. And we definitely agree with what Peter Thiel says about computers being complementary. One of the design principles that we introduced in our latest book Reinventing Customer Engagement is ‘Simply human’; to leverage new technologies to empower customers as well as front-liners so that dealing with insurance becomes much more convenient while securing the feelings side.
Steven: “Absolutely. For me, the most important part of building a business such as Bought By Many, is to be able to understand how to use technology with people, to create a proper winning proposition. We’re not alone in this. For instance, Andrew Rear, the CEO of Munich Re Digital Partners, good friends and supporters of Bought by Many, clearly agrees on the subject when you look at his recent tweets. For Bought By Many it is of importance to add people to technology.”

We actually interviewed Andrew for our book on this subject. Really like his inspiring vision. What is your take on bringing together people and technology? Can you give some examples?
Steven: “Our policy documentation, for instance, is the only insurance policy documentation anywhere that has a Plain English award. Our documents have less then half the average number of words over typical policy documents in that particular sector. Critically, and this is where the technology comes in, is that each and every policy document is created bespoke to each individual. So, there are no extraneous words that are included in that document. Everything in there is relevant and driven by you as the customer.”

So it’s about leveraging technology to ‘mass customise’ products to the exact needs of individual consumers – among others.
Steven: “Exactly. Product development is driven by customers and data. But you’re right; there is more to it. On our quote form for instance, we use a natural language way of encouraging individuals to complete sentences and to engage with the process, that in turn enables us to collect information and improve our offer. You’re also able to upload a photo of your pet – and no less than 78% of our customers actually do this. We are trying to engage them in the process about things they care about. Bought By Many is nothing if not a passionate organisation.”

So it’s not customer centricity as a lip service – that we see too often. It is really in the veins of Bought By Many. Can you elaborate how ‘being passionate’ about this reflects in day to day practice?
Steven: “We are passionate about delivering better insurance for everyone, but we are also passionate about helping customers, who we refer to as members, where they are passionate about something, their pets, their chosen profession for instance. Maybe they are passionate about looking after their diabetes and feel their efforts should be rewarded with cheaper travel insurance premiums. When we are able to demonstrate passion, it enables us to be empathic with our customer base. Being passionate is reflected in every business function. We are also a digital marketing business with the ambition to bring the best of digital marketing to the insurance space.”

This passion for digital marketing reflects in how technology empowers your marketers, which enables Bought By Many to reach customers in new ways, ways they have never been reached before.
Steven: “One important part of our low-cost customer acquisition route is to enable us to rank highly on search engines. On Google we rank on the first page for over 20,000 niche insurance search terms. When you search for best dog insurance at the very top of the screen is a Bought By Many answer. We want to rank on things that customers are looking for, not only on things that we think are important. We spend the time using technology to understand what it is consumers are searching for, and then we want to rank on those terms. This understanding of search also helps targeting and efficiency across our paid acquisition channels. ”

So, you have built the capability to not just understand what people are searching for, but to also play it back to them in a way in which the consumers are looking for.
Steven: “Absolutely, and guess what, customers like this! It is very engaging for them. Let me share another example of empowering our members and our staff. We have a process where we randomly select a member and on their pet’s birthday we surprise them with a gift. For instance, we give them a Woofin, which is a muffin for dogs. (I did not invent the word, so please do not blame me for this.) But, it shows understanding about the passions of our communities and the individuals who have taken the opportunity to trust us, a newer insurance business, with their highly valued pet.”

The proof of the pudding of this trust is when customers file a claim …
Steven: “Claims is of major importance for a whole stack of reasons. When individuals buy insurance, they hope against hope that if they do have to claim the experience is as good as the experience was when they bought the policy. For us, claims is about automation and technology. We offer a complete online claims experience with no forms. You can do this over the phone with no forms if you want. 40% of our customers are now making claims online and last month we processed over 1,700 claims. For us, this is a non-trivial exercise, the speed of paying out claims is important. It is also important for us to have this online option to manage the claims cost. But, critically, consumers are looking for an online experience. Yet, in this process we must not forget that they are humans and that they do not want to only have to deal with computers or a mobile phone.”

Yes. Insurers see risks. Customers feel uncertainty. We believe that, to relate to their customers, carriers need to build in emotion. In the physical world you can do this by looking each other in the eye, putting yourself in a vulnerable spot. Humans inject emotion, empathy, passion, creativity, and can deviate from the procedure if needed. Insurers need to create a similar connection digitally. We think that with so many people working in the insurance sector there is a huge opportunity to create the best of both worlds.
Steven: “I agree. At Bought By Many we have empowered our claims people to step outside the regular process if they think this is relevant at a particular stage of a claim. Think of a pet owner who sadly lost their pet. Our team will send them a handwritten condolence card if the claim is for the death of a pet. The process of handwriting a condolence letter and mailing it takes around 75 to 90 seconds. And, although the customer, for obvious reasons, will not be a customer of ours immediately thereafter, they are huge advocates of ours at every future stage. If they buy another pet, guess where they are coming back to … We place value on understanding customers, our communities and what it is that makes those customers tick.”

Your Feefo rating is a 4.8 out of 5 based on roughly 4,400 reviews, a substantial number.
What is your angle on reaching such a positive score?
Steven: “This is not just a post-acquisition rating. Every single time one of our members has some contact with us – for example making a midterm adjustment or making a claim – we invite them to rate us. 4.8 out of 5 is the rating of every single touch point. I am genuinely proud of this score, notably because it turns individuals into fans. We feel that we are forging new territory in insurance. We are out in the market place, working out for ourselves and sharing with everybody what it is that is necessary to create fans.”

You emphasise that Bought By Many is a for-profit organization, that does not pay out claims inappropriately and is not a charity.
Steven: “We are doing this because this is enabling us to create massive increase in shareholder value. We have a low customer acquisition cost and a service where hopefully customers want to stay with us for life. We are enjoying renewal rates in the low 90’s%. , and this is enabling us to create huge customer lifetime value, which we are reinvesting in creating more fans by  further developing the whole customer experience.”