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Why insurance companies need open banking.

By Boban Ljubinoski.


Open banking is helping to level the playing field for insurance. It might be an age-old industry, but a new generation of digital-first start-ups shows that it doesn’t matter how long you’ve been paying claims. You were founded in 1823? Great. But do you understand today’s customers?

Getting that part right is increasingly about your digital strategy, with close to 50% of insurance purchases happening online in 2022.

In most cases, customers want insurance to be as painless as streaming a movie or ordering a pizza. With those kinds of expectations, open banking is a vital resource for knowing who your customers are and what they want — and giving it to them quickly, conveniently and at the right price.

Of course, that means partnering with an open banking platform that knows insurance. Read on to find out how Klarna Kosma can upgrade your digital performance.

Open banking for insurance: What’s the big idea?

Digitalization is no longer just a buzzword. The tools are available right now to create killer products and solutions. Powered by open banking, insurance companies can access valuable data about potential customers, including creditworthiness, financial history, protection needs, willingness to switch insurance providers, and much more.

With such rich data on tap, it’s easier for insurers to pick the right customers and offer them the products they want. And that can mean lower costs and higher margins. Who doesn’t like that?

3 open banking benefits for insurers.

Finding the right open banking provider for your insurance company involves choosing a platform that opens doors to new opportunities without compromising reliability, integrity, or security.

Whether you’re looking to accurately identify customer legitimacy or want to expand your company’s ability to profile customers, partnering with an open banking platform will help you scale new heights.

Let’s take a look at three open banking benefits for insurance companies looking to partner with a platform provider that can supercharge your digital ambitions.

1. Streamlined customer onboarding.

Customers might want insurance to be as easy as buying a pizza, but the regulatory reality is obviously very different. No worries. Verifying accounts with Kosma means customers can be whisked through the onboarding process. Open banking payments can even double as a “light KYC” check.

Kosma also makes paying claims a breeze. No more checks getting lost in the mail.

2. Really get to know your customers.

Kosma’s solutions allow insurance companies to move away from basic customer segmentation. Instead, you can adopt a personalized approach that looks beyond simple demographics like age, gender and zip code.

Open banking provides a window into your customers’ financial back story, allowing you to build a much more detailed profile.

This ability to categorize, analyze, and more deeply understand your customers can also help to filter out unwanted risks, leaving you to focus on underwriting the risks you want.

3. Tailor your products.

Now that you know who your customers are, you can start to match them with other products that suit their needs.

This is a virtuous circle. Products that are well targeted drive better outcomes for customers. At the same time, selling products to existing customers is less risky and lowers the cost of winning new business.

Insurance and open banking: A winning combo.

When partnering with Kosma, insurers can use our global brand or white label with their own branding. Whichever option you choose, open banking payments can lower your costs and transform your digital strategy.

With Kosma, insurers can speed up underwriting and make quicker, better-informed decisions. Such agility has gained new urgency in the wake of Covid-19. Digital payments providers in Europe saw a 40% increase in 2021, underscoring the pace of change in the post-pandemic digital landscape. It’s never been more important for insurance companies to embrace digital channels.

Today’s insurance customers expect excellent support and claims handling. Powered by open banking, insurers can access in-depth insights about customers that help to deliver the service they want.

At Klarna Kosma, we’re there for you. We know you’ve got this. Collaboration and teamwork are critical to everything we do, and we’re here to support your digital journey with the latest and greatest open banking solutions. We aren’t as old as some of you, but we’ve been doing this for a long time.

Improving customer experience in insurance with Kosma.

Kosma empowers insurance providers to minimize costs, harness new data sources, and deliver seamless customer experiences. We provide all the tools needed to offer a great user experience without compromising security, compliance or the ability to collect, handle, or process customer data.

Backed by 15 years of experience and our pioneering single API, Kosma delivers Europe’s most scalable and proven open banking platform.