36% of the insurance companies taking part in a recent Deloitte online poll (see reference below) believed that product complexity is the factor that most often leads to lack of success.
20% said it was unappealing features and benefits, 20% cited uncompetitive pricing, 13% insufficient product compensation, and 11% lack of speed-to-market.
What contributes to complexity?
When companies where asked what contributes to product complexity:
- 35% said it was evolving customer needs and product features
- 19% said it was distribution channel needs
- 18% said it was competition from other financial products
- 17% said it was impact of regulators
- 11% cited ‘other factors’.
Product design should be more modular
I believe there is not yet sufficient effort to design modular products – a set of simple products that can be combined together in different ways to meet individual customers’ changing needs.
Reference: Cavaleros, G: ‘New Life Insurance Products are Key to Growth’, Cover, June 2008, volume 21, no. 1