This article was produced with Charles Taylor.
Gia Snape, of Insurance Business, sat down with Jeremy Stevens, business unit director EMEA at Charles Taylor InsureTech, about digital trends in motor insurance and how insurance firms can adapt to the evolving expectations of a younger generation of consumers.
With digital technology reshaping nearly every sector, insurers are racing to modernise, personalise, and simplify their motor insurance offerings to meet the demands of a younger generation of customers.
This generation isn’t content with traditional models. Instead, they seek convenience, transparency, and solutions that integrate seamlessly into their digital lives.
At the heart of this change is the shift toward a digital-first approach. Insurers must now meet customers where they are, whether on social media platforms like Instagram and TikTok or through dedicated apps and websites optimized for mobile use.
Insurers face a clear challenge: create a frictionless, omnichannel experience that resonates with modern lifestyles.
According to Charles Taylor, aligning the insurance experience with modern digital habits represents a shift in the industry.
“Technology is pushing insurers to repackage, distribute, and present products like motor insurance—or more broadly, general insurance—to resonate with Gen Z’s expectations,” said Jeremy Stevens (pictured), business unit director EMEA at Charles Taylor InsureTech.
The key challenges for motor insurers, according to Stevens, are keeping premiums low for younger drivers, addressing the complexity of policies, and customers’ lack of trust in insurance.
“Transparency is key to engaging this segment,” he said. “The process of buying insurance must be straightforward and easy to navigate, something that traditional motor insurance often struggles to deliver.”
Historically, insurance policies have been dense, laden with jargon, and difficult to navigate. Insureds answered basic questions about their postcode, vehicle type, and driving history, only to receive an opaque quote with little explanation of how it was calculated.
But today, data analytics and artificial intelligence (AI) allow insurers to provide clear, personalised coverage breakdowns, helping customers understand what they’re paying for and why.
“Streamlining the journey and leveraging sophisticated data points allows for better insights into individuals,” said Stevens. “Integrating data from various sources enables more refined quotes, which can lower premiums and simplify policies in the future.”
This shift parallels transformations in other financial services like banking. Challenger banks, such as Monzo and Revolut, captured the attention of younger consumers with transparent, user-friendly apps and features – and motor insurers are taking notes.
Data is the driving force behind the digital revolution in motor insurance. Thanks to advanced analytics, insurers can now build granular customer profiles.
Innovative models like pay-as-you-go insurance, which charges premiums based on actual usage, are also gaining traction.
And as electric and autonomous vehicles become more prevalent, this trend will take on new dimensions. Policies may need to split liability between the driver and the vehicle manufacturer or incorporate factors like battery life and sustainability.
Telematics devices, such as small black boxes or smartphone apps, monitor driving behaviour, such as speed, braking, and mileage. These insights enable insurers to reward safe drivers with lower premiums, fostering a sense of fairness and accountability.
“These tools help lower premiums and provide more tailored offerings,” said Stevens. “At the quoting stage, insurers now consider a variety of granular risk scores and factors rather than relying on a single generic score, making the process more refined and personalised.”
Similarly, gamification is becoming a popular tool, with insurers offering rewards for good driving habits or eco-conscious behaviour. For example, customers who consistently adhere to speed limits or avoid harsh braking might earn discounts or perks.
For many customers, the claims process can be one of the most frustrating aspects of motor insurance - often slow, opaque, and riddled with inefficiencies. However, digital tools are changing this narrative.
Insurers are increasingly adopting AI-powered claims systems that use machine learning to assess damage, verify claims, and process payouts in record time. AI algorithms can analyse the images, estimate repair costs, and approve claims - all within minutes. This not only improves customer satisfaction but also reduces administrative costs for insurers.
Generative AI tools like chatbots and virtual assistants are further streamlining customer interactions. These tools handle routine queries, allowing human agents to focus on more complex cases.
However, delivering solutions for Gen Z is no small feat, particularly for insurers grappling with legacy systems. Many companies rely on outdated infrastructure that struggles to keep pace with modern demands.
“Large organisations with extensive global operations and decades-old business lines like motor insurance, rely on outdated systems,” Stevens said. “Over the past five years, they’ve begun modernising these systems to integrate disparate data feeds into a unified platform. This involves creating central systems that connect front-of-house and back-of-house operations, enabling a better understanding of customer data and lifestyles.
“Instead of replacing legacy systems, organisations typically add cloud integration and new technologies like OCR, chatbots, AI, or tools like ChatGPT to enhance functionality around existing infrastructure.”
For example, Charles Taylor supports modernisation by implementing these solutions to pull the right information at the right time. This equips customer service advisors with the data to refine quotes and ensure accurate premiums and coverage while avoiding purely automated, generic results.
There are additional complications in motor insurance, compared to simpler products like travel insurance, which has already achieved significant automation. Stevens explained that travel insurance processes are lightweight, requiring only basic inputs like age, destination, and duration for quick, low-cost quotes. Motor insurance, on the other hand, involves dense terms and conditions and requires advanced technology to streamline and customise offerings.
“For instance, pay-as-you-go motor insurance, such as coverage for a Zip Car, demands real-time data integration to activate and deactivate coverage based on when and where the car is used,” said Stevens. “Achieving this requires multiple data points feeding into a unified system, a capability only modernised technology can deliver.”
Marketplaces like Charles Taylor’s InHub are helping carriers stay ahead of the curve. The platform allows insurers to integrate cutting-edge solutions without overhauling their existing systems. Charles Taylor’s global reach further enhances its ability to support innovation.
Learn more about Charles Taylor’s insurance technology platform software solution systems here.
