The Classification Of Consumer Data For Insurance

From property and casualty to health to travel, the insurance landscape is undergoing a vast transformation in today’s digital-first, consumer-driven economy. Today’s legacy insurance companies are being challenged by both start-ups and technology giants starting to play in the insurance space, so they’re responding with their innovative products.

As insurance companies race to innovate, evolving consumer needs and desires are top of mind. The companies that emerge strongest from this period of growth and transition won’t necessarily be the ones with the biggest budgets, but rather the greatest understanding of their prospects and customers; that understanding starts with robust consumer data. Let’s look at the four types of consumer data that insurance companies can leverage today and where each one fits in their broader marketing playbooks.

Zero-Party Data
Zero-party data is information about preferences, interests, and intent shared directly and proactively by consumers, often through surveys, preference centers, or polls. A recent report estimated that, by next year, a mere 15 percent of global brands will be collecting zero-party data. In contrast, 92 percent of marketers said they believe preference data is critical to growth. Based on these findings, it’s clear zero-party data is an area of a missed opportunity for many insurance companies, as it’s highly reliable, can be efficiently gathered without great expense, and is compatible with consumer and regulatory expectations for privacy.

Brands can capture zero-party data in a variety of ways:

  • Preference centers: Subscriber preference centers help marketers improve the relevance of their communications and ensure brands are communicating at the right frequency.
  • Feedback surveys: Consumer feedback today is amplified by technology advances that make it easier than ever to solicit feedback, giving marketers a more accurate picture of consumer expectations.
  • Social polls: Social media polls can be a unique way to connect with consumers and gauge sentiment or interest from your audience.

Having direct data from consumers about their behaviors can inform marketing communications and help insurers provide educational content that emphasizes safety and promotes avoidance of risky behavior. Also, asking your audience the type and frequency of communications they would like to receive help boost engagement by alleviating email fatigue (because of too frequent communications) and preventing missed connections (because of communications that are too spaced out). Insurance brands can also use self-reported product interests and preferences to create better customer experiences and more effective remarketing and acquisition campaigns.

First-Party Data
First-party data is information collected by insurers about their audience and customers, such as purchase history, email activity, web behavior, and — in the case of insurance companies — claims data. First-party data is an insurance company’s bread and butter — one of its most important strategic assets. First-party data includes:

  • Form submissions: Data containing basic contact details
  • Transactions: Data related to day-to-day activity, including new policies, claims data, payments, and more.
  • Marketing campaign activity: Observed data from marketing efforts, such as website page views, email clicks, content downloads, comments, and likes.

Since first-party data includes the bulk of the information you’ve collected about your audience, the applications are nearly limitless. The insights you gather from first-party data can inform all marketing program components — from email creative and copy to crafting customer experiences. For insurance companies, first-party data can also inform dynamic pricing models.

Second-Party Data
Second-party data is information that is collected, owned, and managed by a partner company (i.e., that company’s first-party data). It might include data acquired through ad services like Google or Bing, co-registration campaigns such as contests or sweepstakes, or co-op data pools created by a partnership among a group of companies

Marketers can increase their reach by using second-party data to find new audiences for their products and services. Besides, those that need to reach niche audiences can seek out data partners that have customers within that niche, allowing them to build out their data set for an audience segment they might not have in their existing list. Savvy marketers can also establish partnerships that allow them to co-market with brands that have complementary audiences. For insurers, in particular, second-party data can improve customer experience and risk assessment. Consumers’ growing adoption of connected devices, which can provide tremendous data around real-life behaviors, represent a huge opportunity for actionable insights in these areas.

Third-Party Data
Third-party data is collected by third-party data providers that do not have a direct relationship with the consumers they are collecting data on. The data — including contact, demographic, psychographic, and business data — can be gathered from various platforms, apps, and websites. While other data types can be more accurate and less costly, they simply can’t match the breadth and scale of third-party data. Third-party data, purchased or licensed from a data provider, can be integrated with a data management platform (DMP) or consumer data platform (CDP), which enables companies to easily append third-party data to their zero-, first- and second-party data to build more comprehensive audience profiles and better targeting.

Third-party providers have millions of data points that are collected from a variety of sources, from voter registration to real estate and mortgage information. As such, this data can be used to achieve a more complete view of your customers, connect with new prospects via personalized campaigns, and even target competitors’ customers. Likewise, insurers that do not use third-party data may be shutting themselves off from powerful benefits such as cross-device customer identity recognition and resolution, attribution models, retention models, refined lookalikes, persona, and acquisition models, and other advanced data modeling opportunities.

For insurers, the key to meeting consumer demands for greater personalization while boosting growth in an increasingly competitive industry lies in using the full array of data available to them while taking a customer-first approach. Doing so helps improve performance and ROI, reduce ineffective marketing spend, and boost long-term loyalty by creating experiences and products that build consumer trust.