The Problem of “Pariform” Products in Insurance Companies

In recent years, we have seen a growing trend in the insurance sector: the excessive standardisation of products. The statistical analysis of claims, the models of pricing, the definition of deductibles and the structure of cover increasingly result in virtually identical solutions between insurers.

This phenomenon, which we can call pariform products, poses serious challenges not only for consumers, but also for the mediators and companies themselves.

The use of increasingly robust databases and similar actuarial models has led insurers to converge on similar offers in terms of price and cover. At the same time, contact processes with customers and claimants - call centres, apps, digital portals - follow the same logic, further reducing the elements of differentiation.

In other words, when comparing car insurance, multi-risk home insurance or even health insurance, customers are often faced with almost identical offers.

At first glance, standardisation might seem positive: greater predictability, controlled prices, a common basis for protection. But in practice, this scenario brings several problems:

• Loss of real value for the customerIf all the offers are similar, the choice is made solely on price and not on the quality of the service.
• Difficulty in finding suitable solutionsSpecific needs often go unmet because the product has been designed for “the statistical average”.
• Undifferentiated experienceFrom the customer's point of view, customer service, claims management and the relationship with the insurer end up being almost indistinguishable.

Examples of “standardisation”

Car: Civil liability and own damage covers are practically the same, with minimal differences in exclusions or deductibles.

Multi-risk Housingpre-defined packages that vary only in the capital limit, with no significant innovations in cover.

Healthsimilar conventionalised networks, comparable digital services and aligned prices, making the choice less transparent.

What is lost with this trend?

The essence of insurance has always been the personalisation of protection against individual risk. Excessive standardisation eliminates this promise. What is lost is the identity of the insurers. Offers become undifferentiated and customers are no longer able to see the added value of each company.

But there is something that is not lost - and is even becoming more evident: the role of the professional mediator.

Although the products are similar, the real difference lies in the service, the advice, the monitoring of claims and the defence of the client's interests. This is where Grumese proves its worth every day.

We believe that the sector can only gain from regaining differentiation, and this must be done on two fronts:

- On the insurers' side: innovate in cover, make contracts more flexible, invest in services that go beyond the statistical average.

- On the mediation side: continuing to assert itself as the client's true partner, which doesn't just sell insurance, but interprets, adapts, clarifies and is present when a claim occurs.

Because in the midst of increasingly equal products, the mediator becomes the only reliable link that guarantees the client transparency, proximity and defence of their rights.

It's this closeness and ability to be at the customer's side that no statistic or algorithm can replace.

 

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jose.monteiro@grumese.pt

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The Problem of “Pariform” Products in Insurance Companies