How to make tenant insurance applications more user-friendly

If you think it is easy for clients to apply for tenant insurance, you might want to consider how much trivia those tenants actually know about the property they occupy.

“Every insurance application has questions that aren’t user-friendly and they are not designed to have the consumer in mind,” said Jeff McCann, CEO of insurtech Apollo Insurance Solutions Ltd., in a recent interview about tenants’ insurance.

“It makes no sense that the industry continues to ask the end consumer – whether that is business property or personal property – the same questions over and over when that data is available and ultimately it’s not changing. There should be a way for the industry to come together and share that.”

McCann was commenting on questions such as the year the building was built, the distance to the nearest fire hydrant, the distance to the nearest fire hall and details on the building construction.

While a person who owns a home might know the year in which that home was built or details on the fire protection, the same is not necessarily true for a renter, suggests Greg McCutcheon, president of property database provider Opta Information Intelligence, a unit of SCM Insurance Services.

“Why would the tenant even know those details? You would assume the building owner has to take care of that, not the tenant. There is definitely room to improve that process for certain. I think we are catching up to it,” McCutcheon said of the application process for personal property for renters in condo units.

Some home insurance applications ask how old the furnace or heat source is, whether the roof is asphalt or metal, when the roof was last re-shingled and whether the plumbing has been upgraded, P&C brokerage Mitchell and Whale notes.

The questions consumers are asked, when applying for tenant’s insurance, fall into three general categories, observes Apollo’s McCann. One category is information that affects price or rate. The second is comprised of questions that determine eligibility. Then there is a third category of questions that McCann describes as “pure data collection.”

At least half the questions fall into the latter category, so they do not impact rate or eligibility, said McCann.

“They are purely data collection, and data collection is okay, but what is the real point of those questions?”

With Apollo’s tenant insurance product – announced June 4 – the insurtech is trying to either eliminate the “purely data collection” questions or at least make them easier to answer.

“Often we look at a question that may be cumbersome or confusing and we try to make it a ‘yes’ or a ‘no,’” said McCann. “Rather than asking ‘what year was your building built?’ You can say, ‘was your building built in the last five years?’  And then it’s yes or no. You don’t have to go and figure out that your building was built in 1938. You more or less know it’s an old building or it’s not an old building.”

In major centres  – such as Vancouver, Toronto, Montreal and Calgary – there is a “real desire” to provide much greater automation when gathering property information from renters in condos when they apply for home insurance, said McCutcheon.

One aim of Opta’s products is to give the insurer details on individual properties that are significant from an underwriting perspective so the broker or agent does not have to ask the consumer so many questions.

“We are coming to market with a pre-filled solution for condos but it is just being rolled out now,” McCutcheon told Canadian Underwriter. “I think it will be here in the next six to eight months.”

Feature image via iStock.com/Milaspage