Direct Line Group gunning to be the ‘insurance company of the future’

Direct Line Group (DLG) is gunning to be the ”insurance company of the future”.

In a live video stream this morning from the insurer’s London office, Penny James, chief executive at Direct Line Group, reflected on the key learnings from 2020 and the Covid-19 pandemic while discussing the firm’s preliminary financial results for last year. 

James said that she pictures a fully digital ecosystem to support customers not only during a breakdown, but throughout their lifecycle as a motorist and as a motor insurance customer.

She tipped 2021 as a “critical change delivery year” as the insurer is on route to building what she describes as the insurance company of the future.

She added that she was proud of the sheer scale of what DLG has delivered over the last two years, as well as its plans for 2021.

James explained her vision for the year ahead as “technology and data led but with the customer at its heart. A company that has a real competitive edge and is able to grow profitably. I have been thrilled at our ability to continue to deliver major transformational change even from our homes”.

She continued: “We have seen significant progress despite the extraordinary challenges, quadrupling the size of our team supporting our travel customers, keeping our repair services open and productive, moving the majority of our people to home working and managing the implications of lockdowns across India, South Africa and the UK.”

Utilising digital channels

Maintaining her future focus on technology, James said she has “seen a huge shift in the number of customers interacting through digital channels”.

She explained: “Technology has been at the heart of our digital transformation. This trend [around the use of digital channels] entirely aligns with our plans, but we now know that customers will adopt the digital options available to them, even in more complex areas, so we can really focus end-to-end digital journeys.

“Second, agility is a must - our trading now operates in a fully agile way, making it easier for us to implement change quicker to products and services, [to accommodate] changing customer needs.

“We can learn a lot from fintech, which is one of the reasons why we acquired Brolly last year to help us deliver more flexible personalised insurance products for the digital generation.”

Green Flag

As part of DLG’s customer lifecycle strategy, Green Flag plans to launch a new policy and pricing engine in the next 12 months that will allow it to grow beyond its traditional breakdown services.

It plans to create a customer portal to enable it to address customers’ motoring needs both in and out of an emergency.

“We are already developing the capabilities to offer vehicle repair service and maintenance,” James noted.

Furthermore, she emphasised that “agility and technology can open the way for creativity and growth”, proven by the fact that ”both Green Flag and commercial demonstrate that the investment we are making brings tangible benefits.”

DLG has also moved Green Flag’s legacy systems to a digitally enabled system, while Green Flag’s refreshed Rescue Me app saw an increase in claims filed digitally over the course of last year.

Future is fleet

However, it is the insurer’s commercial division that has made the most progress with digitalisation.

“Investment in technology and the adoption of agile ways of working has enabled it to expand its product offering and introduce more sophisticated pricing, both of which have helped to deliver growth and stronger margins,” James said.

Back in 2018, Direct Line for Business was the first part of the business to adopt agile ways of working and deliver a new digital platform in the micro-SME space.

Last year, it continued to expand its product offering by moving it core products – tradesman and van - on to the new platform. This led to van policy growth of more than 9% that same year, despite significant reductions in new business shopping in the market in Q2.

Looking to the future, James said that she wants contracts with digital mobility providers Drover and Trov to open up opportunities in the fleet market.

She cited the 62% of premium growth in commercial insurance was delivered via price comparison websites.