Health Insurance - Optimising a Product Portfolio
Our client was looking to undertake a comprehensive review of its health insurance policy portfolio, in order to stay relevant and ensure a consumer-aligned product suite. This involved understanding the elements of PHI product bundles that are valued most by consumers, and those that offer hidden value pools that can be leveraged. A key challenge with this was the complexity of the category and products within it, including the typically very large range of inclusions within the cover. An additional challenge was the fact that the depth or extent of coverage itself also needed to be taken into account for those areas for which cover was included.
Nature designed a multi-phase research program to meet these objectives. The first phase identified key product components that had the greatest impact on customer decision making. The second phase measured the relative impact on choice and interaction between these key attributes, to produce a model of customer decision making for the category. The research program employed comprehensive discrete choice modelling of key hospital and extras features and inclusions, based on a sample of 5,000 health insurance holders and intenders.
This resulted in a robust model and associated market simulator that allowed the client to road-test hundreds of potential product configurations, and that gave us the ability to provide advice on key opportunity and growth areas. The research provided guidance on which product features played the greatest role in determining customer choice, and how to defend and grow share. Strategic guidance was also provided to the client on additional potential product configurations, beyond those already identified. The insights from this research were subsequently used to modify the client’s product portfolio to better fit the requirements of the market.