In an effort to attract a younger market to its range of life and health insurance products, increase the nation's happiness and save the company some money on claims, Sovereign has rebranded around the line 'Life. Take Charge'. But rather than just talk about itself and continue to drum home the classic insurance message of it will be there when you need it, it's aiming to create healthier Kiwis by equipping them with a range of practical tools.
Sovereign's head of brand Ben Rose says the biggest factor about the repositioning of the 25-year-old company was the cultural change. The company, which has 650,000 customers and is New Zealand's largest life insurer, needed to lead by example so the whole thing has been done "from the inside out" (he points to Air New Zealand as a good example of a company with a powerful internal brand and plenty of pride in what it does, and customers draw value from that).
He says the new brand positioning has been embraced by the whole business and he says it is now selling healthier food in the cafe, running boot camps and encouraging staff to show how they're taking charge (Rose’s business card says he does that by eating good food and exercising three times a week).
"I can’t go around eating pies," he says, as a single salty tear rolls down his cheek.
Doing ads that say 'we’re really awesome' is easy, Rose says. But this was "a two-and-a-half month process that looked at every single touchpoint" and then tried to find ways in which the company could enhance the lives of its customers.
As such, it’s rebuilt its social channels, it's conducted some research into the nation's health, it's struck up some content partnerships and it’s hired a couple of brand ambassadors—buff actor and personal trainer PuaMagasiva and personal trainer, nutritionist and lifestyle coach Nicola Reilly, who runs what Rose calls "a Facebook gym" that gives tips on how to implement healthy living into people's routines.
It’s also refitted a 1978 Dodge ambulance and called it the Action Unit, which "instead of picking up sick people, will be giving out good things".
"That’s what we’ve built the whole brand around. It’s not just talking about it. We’re doing stuff to make people healthier.”
Sovereign, which offers its services through its fellow Commonwealth Bank of Australia company, ASB, through brokers, and a relatively new direct sales team, has also announced that it has signed on as naming rights sponsor for the Tri Series for the next three years. And, in keeping with that (and perhaps as part of the healthy living clause that Rose says was written into the contract for its agencies JWT and Dentsu-Aegis), Rose is currently training for a unique triathlon against JWT’s managing director Simon Lendrum. The pair have to run from Sovereign HQ to Takapuna, kayak to Devonport and then play five frames of pool. The loser has to take the other team out to lunch at a venue of the winner’s choosing. So far Rose has lost 17kgs and he says Lendrum has given up smoking and lost a few kilos too.
There’s a danger that this approach could be seen as overly preachy. But he says it’s not about berating people for being unhealthy or lazy, it’s about being useful, something many marketers are trying to do here and around the world, and standing out in a "sea of sameness".
"The big thing for us is to get people healthier. If our customers are healthier, we don’t have as much to pay out ... What we found [with our research] was that insurance companies don’t tend to stand for much aside from ‘we’re there when you need us’ or 'we’ll pay for your cancer treatment'. What New Zealanders were saying is that there’s no difference between insurance companies."
When State launched a campaign earlier this year for its motor services pack, it said that customers wanted more than just protection. They wanted insurance companies to do more to prevent accidents. So Sovereign, following on from some research that showed New Zealanders are not as healthy as they think they are, is aiming to help people better understand the four essentials of a healthy lifestyle: exercise, eating well, sleep and happiness.
Rose says the campaign is targeting a new audience of 25-35 year olds, a group not traditionally renowned for thinking about health or life insurance—or for their desire to connect with insurance companies. And as it’s aiming for this demographic, the campaign will focus on digital, ondemand video, radio and social, with the first activation of the Action Unit set to kick off this weekend.
It's also up against NIB in this space, which bought Tower Medical Insurance in 2012 and launched in New Zealand late last year. It is also a youth-focused insurance brand that claims to have 40 percent prompted brand awareness in its target under 40 age group. And while Rose wouldn’t specify Sovereign’s current market share, he says it’s "a serious player" (Southern Cross is thought to have around 70 percent of the health insurance market and it seems to have responded to NIB's arrival with a few new campaigns). He also points out that it pays 94 percent of its claims, although he was unable to say how that compares to its competitors.
So why would young folk be interested in hearing from Sovereign?
“We’re giving them value. They don’t know what they’re paying for ... We’ve put a lot of time and effort into how we can deliver products into market that you can have control over."
As Google’s Annie Baxter said recently when talking about Google Now, relevancy requires data. The data revolution is particularly interesting for the insurance sector as it's historically been based on risk profiles and big brained actuaries, rather than reality. These days, in the case of car insurance, GPS technology and in-car computers have the ability to track driver behaviour (Tower released an app this year that rewards customers for good road behaviour). And the rise of the quantified self means that’s probably not too far away in the realm of health insurance.
Rose says Sovereign is looking at ways of combining its own data with external data (for example, medical records that are provided to the company by customers or customer-provided data from personal devices) to provide better and/or cheaper cover. But transparency goes both ways, of course. It stands to help those who are healthy and honest but harm those who may have been telling their insurance company a few porkies in an effort to get cover or decrease their premiums. And it's also a risk for the insurance companies.
"The risk is we give a discount to them for being healthy and they’re not. And then we get a rude awakening."
So what about a scheme where clients get their money back if they don't use the cover? There is the classic no claims bonus, of course. And Sovereign has also launched a public hospital credit for Private Health and Private Health Plus customers who for some reason have treatment in the public sector even though it was for something covered under their Private Health insurance. This means if they stay in hospital for a minimum of two nights Sovereign credits the amount of their annual premium to their account so they get a year’s free cover.
But as Michael Kinsley wrote in Vanity Fair recently: "Another way to look at health insurance is as a gamble where you’re betting against the house and hoping to lose. If you’re in perfect health until you die suddenly at age 90, you’re not going to mind that the insurance company avoided much cost."
And by equipping New Zealanders with tools to improve their health, that's what Sovereign appears to be banking on.