People only contact their insurers when things go wrong and they need to make a claim. This generally means losses for the insurer. It also means stress and troubles for the customer. In order to relieve both problems, insurers increasingly offer extra services alongside their traditional policies.
Aviva, a British insurer, for instance, installs sensors on customers' water pipes to detect very small leaks, so that these can be repaired before causing greater damage. This spares Aviva the cost of a bigger claim, and the customer the misfortune of a flooded basement.
Life insurers have so far been slower to catch on. But this is changing. Often extra services help people to live more healthily. AXA, a French insurer, gives its customers access to check-ups. Union Life, a Chinese one, guarantees customers a place in an old people's home and advises them on activities in retirement.
Last month, Haven Life, an American life-insurance agency, announced it would include a set of extra services for its customers. That makes it a pioneer on its home market as its new policy fits neatly into the global trend. Its extra services centre on health. For instance, customers also get discounts on family-health services at some clinics, and access to a genetic health test. Now more and more American life insurers have joined it. Ladder, a life-insurance startup, offers some help on financial planning through an online tool. State Farm, a large American insurer, gives customers a discount on in-home sensors that monitor old people's health.
These services are not in short of demand. A survey by Bain & Company finds that American consumers have very similar preferences to other parts of the world on the sorts of services they want from life insurers. But America is not a friendly place for innovative insurers. New policies must be approved by each of its 50 state authorities. Some states' laws are too inflexible, and do not allow for such extra benefits. Even when an offering suits insurers and their customers, it can still take time to spread.