Telcoinsurance is the integration of telecommunications services with insurance products. When a telecommunications company offers such services to its customers, in most cases it is in collaboration with an insurance company or through a captive or a company belonging to the telecommunications group.

The products offered range from insurance for mobile handsets, electronic devices or cyber-risk insurance to more complex services such as life or health insurance. In addition to generating revenue, these added services can build customer loyalty and reduce churn between telephone operators.

The advantage to insurers of handling large amounts of information goes further, as it could even allow them to avoid a potential peril that would have resulted in a loss, both for the insured and the insurance group.

Advantages of Telcoinsurance

• The telecommunications company’s data (socio-economic, usage, geolocation) is a tool to reactively manage risk, to prevent damage before it happens.
• The insurances that can be offered are very varied: eHealth, life, car, home, devices, etc. They can even generate new products based on their field of operations, e.g. eGames insurance.
• By its very essence (app/website), the telecommunication company maintains a close relationship (communication) with its customers
• The link between financial institutions and insurers highlighted the importance of cooperation between complementary companies. A number of financial institutions derive more than 25% of their revenues from insurance business.
• Insurance can be taken out in a few simple steps using a mobile phone. It is estimated that around 54% of the population (4.3 billion) owns a smartphone.
• Gaining market share (telephone line subscribers) is almost impossible at this stage. Telcoinsurance is a way to achieve new revenues.

When implementing a Telcoinsurance service, the telecommunications company must overcome the complex regulations governing the insurance business. In particular, those related to privacy and security.

In short, the insurance area represents an opportunity for telecommunications companies to diversify and increase business volume.