USAA’s Digital-driven Customer-Centric DNA

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USAA, the Texas-based diversified financial-services player, whose products and services span across banking, financial planning and the insurance domain, has consistently won accolades for superior customer service. A critical factor behind USAA’s success on customer-centricity has been its early bets on digital insurance and specifically, the mobile channel.

USAA’s early emphasis on embracing predictive modelling has also helped in proactively identifying clients’ needs to deliver automated yet personalised services. For example, USAA has recently entered into a partnership with Saffron – a California-based start up – to design an algorithm that will anticipate members’ upcoming needs for financial products. According to USAA, Saffron’s product recommendations resulted in over a 50% rise in predictive performance over other methods previously applied. Apart from Saffron, USAA’s other notable startup collaborations include Expect Labs (a pioneer in conversational UI), Narrative Science (creates Software to Enhance Human Productivity), CafeX (creates Video collaboration and streaming software) and MX (Digital Money Management).

A critical factor behind USAA’s success for customer-centricity  has been its early bets on digital insurance and specifically, the mobile channel.

USAA is also prioritising mobility and using smartphones to deliver solutions that are differentiated. For example with USAA’s Virtual Mobile Assistant, members can search for and group together transactions simply by giving voice instructions like “pay my car insurance next Wednesday using my Visa card”.

Benefit to Customers

• Unique Experience
• Increasing Satisfaction
• Anytime, anywhere personalised service
• Lower cost of insurance

Benefit to the Insurer

• Efforts to understand the before, during and after of the customer’s journey helps in recognizing new opportunities for growth
• Cost reduction and operational efficiency
• Increased market share and profit
• Brand loyalty and competitive differentiation

USAA’s mobile first approach has enabled it to establish a single, unified view of its customer irrespective of whether they transact as a banking, insurance or other domain customer. This holistic view is a key enabler for USSA’s ability to tailor the experience each customer has across the spectrum of financial services; providing real time information, cross selling opportunities and ultimately, a higher retention rate of customers. It also provides a great example of a company that has built multiple external partnerships with startups and other experienced players who can deliver the required solution as a service.

Ultimately, although leveraging digital megatrends such as mobility, analytics, AI and IoT are key considerations for insurers, these efforts alone are not sufficient. As we have seen is USAA’s case, true customer-centricity also demands product evolution not just distribution innovations. In this backdrop, traditional insurers must shift their focus from product and sales to identifying the next generation of insurance products.

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