Open Banking & Insurance

How Insurance Companies Use Open Banking to Improve the Customer Experience and Increase Revenue

26. February 2020 / in Trends

The insurance sector has undergone major changes in recent years. Customers expect digital processes and solutions with just a few clicks. Today, obtaining insurance should be uncomplicated, transparent, fair and fast.

CTA Customer Experience

The relationship between the end customer and the insurance company is currently a much discussed issue. How can insurance companies take advantage of digitalization and data to make their services not only better for customers, but also more lucrative for their business?

Clear the stage for Open Banking! Open Banking embodies innovative strength, customer-centric approaches and a flexible, agile modus operandi. It is the gateway to the digital age – not only for banks, but also for insurance providers. Insurance companies can benefit at various levels by using digital Open Banking services and by avoiding lengthy and expensive in-house solutions.

With Open Banking, data can be used in an optimal way and common payment procedures can be enhanced using the latest payment methods. In the form of a cooperation, Open Banking service providers, otherwise known as Account Information Service Providers (AISP) and Payment Initiation Service Providers (PISP), provide insurance companies with the necessary innovation at the push of a button.

In this blog post, you can find out how insurance companies are using Open Banking both to optimise their service in two places at once and to increase their turnover.

Open Banking is not only a key issue for banks; it is also the gateway for insurance companies into the digital age.

How Insurance Companies Use Account Information Service Providers to Optimise Their Services with Open Banking Data

Open Banking services promise insurance companies new revenue channels, the optimal use of customer data and, as a result, higher levels of customer satisfaction and customer loyalty. This is made possible by services from certified third-party providers such as the Open Banking platform from FinTecSystems.

By making use of Open Banking platforms, insurance companies are seizing the opportunities afforded by the Payment Services Directive 2 (PSD2). The prerequisite for a PSD2-compliant Open Banking strategy is that insurance customers agree to the use of their data by providing their financial information via a login to online banking.

Using such data, Account Information Service Providers offer you as an insurance company comprehensive analysis of your customers’ expenditure and income. Based on this, you can then offer personalised recommendations and generate real added value. Read the next section to find out how Account Information Service Providers help insurance companies to increase sales with the Open Banking platform and the Digital Contract Check.


How does the Digital Contract Check increase the revenue of an insurance company?

With the Digital Contract Check, Account Information Service Providers support insurance companies in using Open Banking data. At the customer’s request, Account Information Service Providers access their online banking via Access to Account (XS2A) and extract the relevant data. In the form of a contract check, Account Information Service Providers collect, analyse and categorise this authorised data from insurance customers.

Read how the principle of the Digital Insurance Check works and where digital account analysis is already being used.

The Digital Contract Check provides insurance companies with answers to their most frequently asked questions:

  • What insurance policies does the customer already have?
  • Where are there gaps in their insurance cover?
  • What could be particularly interesting for the customer and offer real added value?

The Digital Contract Check provides insurance companies with fast, easy-to-understand information on potentially existing insurance relationships derived from the customer’s account transactions. Using this information, the insurance company can better assess where there is overinsurance or underinsurance and which offers may be of interest – and then make useful recommendations.

In particular, key life events such as starting a family, buying a house or starting a new career are recognised immediately, which means the insurance consultant can react accordingly. Insurance companies can promptly offer the right product for every major change in life. For example, if the technology indicates that a customer is receiving child benefits for the first time, the advisor can recommend a life insurance policy or point out specific insurance offers for families.

This way, the Digital Contract Check can also be used to create up-to-date, data-driven customer profiles. These specifically help to build a precise strategy for cross- and upselling and enable the company to recommend the right product to the right user at the right time. The customer themselves decide whether they want to provide all the important information and receive the best possible advice based on this.

For customers, this range of Account Information Services can be further enhanced by the possibility of storing all contracts in one place to ensure maximum visibility.

How Insurance Companies Use Payment Initiation Service Providers to Positively Influence their Customers’ Payment Behaviour

The insurance industry in Germany currently has a turnover of around 1.6 billion euros and processes over 2 billion euros in payments every year. This is a considerable amount! However, most insurance companies only offer their customers direct debit and bank transfer as payment methods. Providers such as PayPal are rarely on the list. This neither corresponds to the digital transformation efforts of the insurance industry nor to the digital reality in which your customers live.

The appearance of an innovative payment procedure for insurance companies has long been overdue. Since PSD2, however, nothing is stopping this from happening. The new transfer function is inexpensive, convenient and can even be implemented as a white-label solution.

The process is very simple: If the insurance customer wants to make either a one-time payment or an additional payment, they receive a QR code, otherwise known as the pay code. This will be printed on an invoice, for example, in a PDF or via email. When the code is scanned, a pre-filled payment form will appear on the smartphone, which the customer only has to fill in and send. Payment will thus no longer be a stumbling block when taking out insurance.

This is also good news for the insurance company’s accounting department. The payment form is already displayed to the customer with the correct invoice amount and the intended purpose. This avoids errors when typing in data manually and significantly reduces the error rate. A large proportion of the tiresome queries for both sides are thus prevented and the accounting department can concentrate on more important tasks.


These four cases show how a seamless payment experience increases the conversion rate.

Why the white-label solution for insurance companies?

White-label solutions not only make insurance companies look more professional; they also optimise their relationship with customers in the long term. The image and visibility of their brand are enhanced and customer satisfaction levels increase.

Why? In the case of the Digital Contract Check, you can make tailor-made offers for the customer and make intelligent use of data under the insurance company’s own name. Your brand is thus associated with innovation and a positive experience.

A note on our own behalf: FinTecSystems offers Easy Onboarding, a customisable landing page with login for the end customer. The solution is PSD2-compliant and works according to the plug & play principle – all you have to do is integrate a link on your homepage. Digital transformation has rarely been easier to implement in the insurance industry.

The quick and easy payment method by direct bank transfer also appears in the name of the insurance company. With its own payment service, the complete customer experience takes place through the insurance company. Thanks to the payment method with your own look & feel, you save your customers the cumbersome process of doing a manual transfer. Instead, by scanning the pay code printed on the invoice, they can be directly forwarded to a pre-filled payment form in the design of the insurance company.

Open Banking goes far beyond banking. Let these three examples inspire you. Can you draw parallels to your own industry?

Schlagworte: Trends

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