Insurance App Development: Cost, Trends & Innovation

By Itobuz Technologies • December 13, 2024 edit

The global insurance industry is experiencing a mobile app revolution. A recent survey involving executives from the insurance industry revealed that:

99% of senior C-suite claim that mobile apps play an indispensable role in engaging new-age customers
98% say that their agencies will add more customer-centric features to their apps by 2025

Do customers also want these companies to invest in insurance app development? Absolutely:

According to a report by Ernst and Young (EY) over 80% of insurance customers want to use digital channels like apps
Most customers prefer using mobile apps over interacting with insurers via human agents

Customers’ increasing demand for mobile-first experiences is the main driver pushing insurance organizations to invest heavily in insurance mobile app development.

Agile insurance companies that invest in mobile apps stand to benefit greatly in this environment. This article details everything you need to know about app development for the insurance sector:

Why Insurance Companies Need Mobile Apps
The Key Features of a Successful Insurance Mobile App
The Different Types of Insurance Apps Agile Companies Are Creating
The Type of Technology Stack Companies Need to Create Their Own Insurance Apps
The Insurance Mobile App Development Process
Cost of Insurance App Development
The Most Important Trends and Future of Insurance Mobile Apps

Why Invest in Insurance App Development?

There are two main reasons for the lack of technological innovation in the insurance space

The complexity and the heavily regulated nature of the insurance industry
The profitability of incumbents provides hardly any incentives to change

For years, there has been no major reason for any change to take place within the industry. Now, all of that has changed because of the following reasons:

Increased Customer Expectations

Insurance companies have a hard time connecting with new customers and keeping current ones engaged. Many people are interested in insurance but do not interact much with companies. It creates a gap between what customers want and what insurance firms offer.

One reason for this gap is the many middlemen involved, like agents, banks, and brokers. These middlemen make it harder for customers to connect directly with insurance companies. This is a problem, especially for millennials:

Millennials aged 18-34 make up about a quarter of the world’s population
They do not rely on family or friends for insurance-related info
Instead, they prefer online reviews and social media to learn about finance or insurance products and services

This shift means that insurance companies must adapt quickly. To meet these expectations, insurance companies need to invest in insurance mobile app development.

Insurance apps can help bridge the gap between customers and insurers and make it easier for people to:

Get insurance-related information and services whenever they need them
Instantly apply for insurance
Make online premium payments
File claims quickly by uploading documents directly through the app
Access policy information anytime, anywhere
Receive real-time updates on claims status via push notifications

This shift towards mobile solutions not only enhances customer satisfaction but also fosters loyalty, as clients appreciate the ability to manage their insurance needs without traditional barriers like paperwork or office visits.

Competitive Edge in the Digital Age

Many traditional insurance companies are still slow to change and have outdated systems. They often stick to old legacy systems that are hard to update. New startups can and are taking advantage of this situation.

They can offer modern solutions without the high costs that traditional companies face when trying to change. One way they are doing this is by offering on-demand insurance. This type of insurance allows customers to pay for coverage only when they need it:

Many customers find on-demand insurance convenient
Younger people especially like this option
If someone rarely uses their car or motorcycle, on-demand insurance can be cheaper than paying for a full year of coverage
However, there is a risk with this model: if a customer forgets to activate their insurance before using their vehicle, they might not be covered in case of an accident

This is where mobile apps can help:

With just a tap on their phones, customers can easily turn on their on-demand insurance coverage
A great example of how insurance companies use mobile apps is the MyAXA app
This app lets policyholders access and manage their on-demand insurance plans and documents directly from their phones
It makes it easy for customers to stay informed about their policies
AXA France has teamed up with Facebook Messenger to provide a fully digital experience for young customers
With the help of Facebook’s AI-powered chatbots, AXA customers get fast, error-free customer service 24/7

Automation and Cost Reduction

Mobile apps can help insurance companies reduce manual tasks and save money. Here’s how they do this:

Quick Advice and Assistance

Insurance apps can provide fast support when customers need it
Whether it is answering questions or giving information, these apps help customers manage their lives, properties, and finances better

Anticipating Customer Needs

Mobile apps can also predict what customers might need
For example, they can offer coverage options or alert customers about potential risks before they happen
This proactive approach helps fill gaps in the customer experience

Collaboration and Engagement

Apps can improve communication between insurance companies and their customers
By offering unique services, insurers can attract new customers and keep existing ones happy

Using Data Analytics

Data analytics play a key role in modern insurance
Mobile apps collect and analyze large amounts of data from various sources
This information helps companies understand their customers better and make informed decisions

With data analytics, insurers can:

Predict market trends.
Improve their products and services.
Make automatic decisions about premiums and claims

This means that insurance companies can respond quickly to customer needs while reducing costs.

Personalized Assistance

Mobile apps can offer dedicated personal assistance
Customers can interact with the same representative each time they need help
This builds trust and encourages long-term relationships

Mobile apps provide automated services that go beyond basic self-service. They offer customized support based on customer needs, making their experiences with insurance agencies more personal and impactful.

As of 2024, insurance agencies must target both the 3.9 billion Android users and 1.46 billion iPhone users in the world.

Key Features of a Successful Insurance Mobile App

Investing in insurance app development is logical and lucrative. Now, let us try to understand all the key features that a ‘successful’ insurance mobile app should have:

User-Friendly Interface

A simple and intuitive user interface (UI) is crucial for any mobile app
Users should be able to navigate the app easily without feeling overwhelmed
A well-designed interface helps users find what they need quickly
This UI must display the insured person’s policy details clearly and payment buttons
Users should be able to easily review their policies or request help directly from this page
The GEICO app’s UI is a great example
Users can easily access their policy info, assistance features, and payment options right from this app’s main UI

Policy Management

Users should be able to view, update, and renew their insurance policies directly from the app
This feature allows customers to manage their insurance needs without needing to call customer service
The Progressive app allows users to manage their policies with ease
On it, customers can view their coverage details, renew their policies, and make other changes with ease

Claims Submission and Tracking

The ability to file claims swiftly and track their statuses in real time is essential for a positive insurance experience
This feature is vital for reducing frustration and keeping customers always informed about their claims
The Snappii Insurance Claims Manager lets users take pictures of damage, fill out claim forms, and submit claims instantly

Payment Integration

Integrating payment gateways into the app ensures that users can pay their premiums seamlessly
This feature should support various payment methods for user convenience
It should accept payments from major providers like Visa and MasterCard
It must offer options like one-click payments or automated billing
The Lemonade app offers a smooth payment process where users can pay their premiums using credit cards or bank transfers

Chatbots and Customer Support

AI chatbots provide 24/7 customer support
They answer questions and assist users with common issues without any human intervention
GEICO’s chatbot Kate is a great example
It guides users to the right sections of the app and answers customers’ queries instantly via text

Push Notifications

Push notifications keep users informed about important policy-related updates
This feature helps ensure that customers never miss premium due dates or claim statuses
The Allstate app sends routine push notifications to remind users about upcoming payments or changes in policy status

Quotation & Filters

A good insurance app should have a quotation feature that allows users to get instant policy quotes
It should also include filters to help users find the right coverage based on their needs
For example, the Policybazaar app offers a Quote tab that instantly pulls user info from its database
This feature provides quick quotes and connects users with agents if needed
The app also uses big data to offer personalized quotes based on user inquiries

Claims-Filing Section

Integrating a claims-filing section where users can submit claims easily by uploading documents is crucial
The IFFCO Tokio app allows users to file claims by simply taking photos of the required documents
On this app, the entire claims-filing process can be completed on one page

Document Storage and Upload

Users need the ability to upload and store important documents securely within the app
This feature should allow uploads from both local files and external sources like email
Again, the Lemonade app is a great example of an insurance app with this feature

Personalized Customer Dashboard

Customers should have a personalized dashboard with an intuitive self-service UI with features like:

Easy user registration
Profile management tab
Document repository that stores digital versions of all key policy documents, past payments, etc.
The Progressive app includes a comprehensive customer dashboard where users can effortlessly manage all aspects of their insurance policies

Thanks to developer-friendly Android languages like Dart and top iOS programming languages like Swift, it is easy to add these essential features to insurance apps.

Types of Insurance Apps

Here are some must-have features for different types of insurance apps from different insurance sectors:

Life Insurance

Life insurance apps should focus on providing comprehensive information and flexibility for users:

Detailed profile for each policyholder with all relevant data about the insured individual/asset
Easy-to-browse lists of available policies with coverage options
Usage scenarios outlining various use cases for each policy
On-demand activation buttons so that users can instantly activate/deactivate their insurance coverage
Geolocation features
The HDFC Life app offers all of these essential features that Life insurance apps must have

Property Insurance

Property insurance apps should:

Help users maintain their assets and monitor risks with regular maintenance reminders
The app should auto-monitor potential issues like leaks or malfunctions
The State Farm app has many such smart monitoring features

Vehicle Insurance

Vehicle insurance apps should offer:

Quick access to info and support during emergencies
Service listings with access to specialized services for vehicles
Geolocation for accidents
Mapping tools to help users locate repair services, gas stations, and other assistance quickly
Driving behavior tracking
Instant claim filing by uploading pictures/videos from the accident scene
The All-State app has all of these features

Health Insurance

Health insurance apps should facilitate easy access to:

Easy-to-use plan selection tools
Doctor locator to help users find doctors nearby
Easy appointment scheduling with built-in calendars
Symptom-based doctor selection tools
The Oscar Health app offers these specific features

Travel Insurance

Travel insurance apps should enhance the travel experience by providing essential info and support during trips:

Verified travel guides
Service listings for travelers including local guides or emergency contacts
In-app maps that provide navigation assistance.
In-app chat support so that travelers can address issues like lost documents or flight delays
The World Nomads app offers comprehensive travel guides, in-app chat support, and claim-tracking features

Business Insurance

Business insurance apps need features that cater specifically to business needs and risks:

Concise quotes explaining what is covered under each policy option
Strong authentication methods to verify user identities securely
A well-organized dashboard to navigate policy features easily
Intuitive search functionality
Automated claims processing

The Next Insurance app provides a straightforward dashboard where small business owners can easily manage their policies, obtain quotes, and file claims

Tech Stack for Insurance Apps

Let us pick the right tech stack to help you build the app you’re envisioning:

Define Your Platform

First off, settle the iOS vs. Android app development debate:

Determine whether you want to develop your insurance app for iOS, Android, or both
If you want an iOS insurance app, you’ll need developers proficient in Swift or Objective-C
If you want Android Apps, you’ll need developers proficient in Kotlin or Java
Or, you can use a combo of Swift and Kotlin to develop two versions of your insurance app like Lemonade does
An even better option is to develop the app with a cross-platform framework like React Native or Flutter
Write code once and deploy it on both platforms with frameworks like Policygenius (which uses React Native)

Understand Project Requirements

Assess your insurance app’s complexity:

What features do you want to include?
How many users do you expect?
Will it need AI features, real-time data processing, etc.?

If your app will feature heavy data processing and other advanced features, it will require more robust backend solutions.

Choose the Right Backend

Your insurance app’s backend is crucial for managing customer data and complex business logic. Your choices for backend technologies include:

Node.js – Ideal for real-time insurance apps that need to handle multiple user requests at the same time
Django (Python) -Excellent for rapid development with built-in security features
Ruby on Rails – Good choice for less-experienced development teams that want to get the job done fast

Geico handles high volumes of user requests effortlessly because its microservices architecture is built on Node.js. Also, use popular cloud services like AWS or Google Cloud for scalability.

Integrate APIs

Integrate the following essential APIs into your insurance app to enhance its functionality:

Secure payment gateways like Stripe or PayPal for transactions.
Google Maps API for location-based features
Identity verification services like Jumio to prevent fraud
Twilio‘s API for SMS notifications

Data Management

Will your app have to handle structured data? Will it have to respond to complex queries? Then opt for SQL databases like MySQL or PostgreSQL. For e.g., the Progressive app uses PostgreSQL. If it’s handling unstructured data, opt for NoSQL databases like MongoDB.

Security

Use SSL/TLS protocols to secure all customer data transmission. Consider integrating fingerprint or facial recognition like Lemonade for added security.

Team Expertise

Make sure your team of developers is familiar with the tech stack you plan to use.

Future Maintenance and Scalability

Use a clean codebase that allows easy maintenance and scaling as your app’s downloads pile up.

Insurance Mobile App Development Process

Here’s how a professional insurance mobile app development process progresses step-by-step:

Step 1: Strategy

The first step is to create a clear strategy:

This means planning how you will develop your insurance app and what features it will have
A good approach is to start with a Minimum Viable Product (MVP)
An insurance app MVP must include all the essential features it needs to test with users

Before you start building your MVP:

Study your competitors to understand what they offer
Determine which features are all essential for your insurance app
Understand who’ll use your app and what they prefer
Look at current Android and iOS app development trends in the insurance app sector

Fun Fact: Before earning a 4.9/5 rating on Google Play Store (one of the highest in the fintech app genre) the Lemonade insurance app started as a simple MVP for home and renters’ insurance. This MVP was refined for years before it became what it is today.

Step 2: Discovery

The discovery phase ensures there is a market for your insurance app. In this phase, you:

Describe your target audience in detail
Estimate how many users might be interested in your app
Recruit potential users for tests
conduct interviews to understand their needs
Identify direct and indirect competitors
Analyze how much users are willing to pay
Analyze how scaling the insurance app could affect revenue

This research helps predict your insurance app’s profitability. It also informs your pricing strategies. The Allstate app underwent extensive discovery and user research before launching new features like personalized insurance quotes based on user data.

Step 3: Design

At this stage, gather references that reflect your insurance app’s design preferences:
Collect images and examples that show what you want your app to look like
Create a mood board to communicate your insurance app’s desired style
Create a mind map outlining the user journey through the app
Finalize the design direction
Create wireframes and prototypes to visualize the app’s layout and functionalities
Send the wireframes for testing and approval

Investopedia ranks Esurance as the best insurance app because of its simple UI design.

Step 4: Development

This step involves frontend and backend development:
Use an agile approach to optimize this step
Divided development into short periods called sprints
Give Each sprint specific goals
Collect feedback from users and stakeholders to make necessary adjustments throughout the process

From State Farm in the US to Cuvva in the UK: all the leading insurance apps of the world use Agile development methods to continuously improve their features based on user feedback.

Step 5: Quality Assurance

QA ensures that all functions of the app work correctly:

Testing should cover different devices and scenarios to ensure stability and performance
QA engineers perform both manual and automated tests to identify any issues pre-launch
This thorough testing will help ensure a smooth rollout of the app

Step 6: App Release and Post-Release Support

After successful testing, it’s time to release your app on platforms like Google Play Store or Apple App Store:

Ensure that all necessary approvals are obtained for publication
Once users start using the app, collect their feedback
User reviews will provide valuable insights for future improvements
Work with a development team that offers post-release support (fixing bugs, updating features, etc.)
Your development team should also help the app ensure compliance with platform guidelines

Cost of Developing an Insurance Mobile App

Insurance app development costs will vary based on:

App complexity (in terms of overall functionality)
How many features the insurance app has
Its design complexity
The technology stack you choose
The insurance mobile app development team’s location and hourly fees

Here’s a basic breakdown of all the major costs:

Trends and Future of Insurance Mobile Apps

The world of insurance app development is going to be very exciting in the next few years:

AI

Artificial Intelligence (AI) and machine learning are transforming how insurance companies personalize their offerings
Insurers can now use AI to evaluate risks in real time
Apps like Lemonade can already analyze vast amounts of data and provide tailored policy recommendations
Metromile also uses AI to track driving behavior and adjust premiums in real-time

Blockchain

Blockchain technology can radically enhance security in transactions
Blockchain can streamline claims processing by creating a secure and immutable record of transactions
The Guardtime platform already uses blockchain to create transparent audit trails and secure data integrity in insurance claims

IoT

The Internet of Things (IoT) is reforming how insurers assess risk and offer dynamic policies based on real-time data
IoT devices can provide insurers with real-time data about user behavior
Live data allows them to adjust policies dynamically
The Root Insurance app uses telematics to track driving habits through users’ smartphones

Conclusion

The global recession and the pandemic have greatly impacted many industries, including insurance. Now, more than ever, it is essential for insurance companies to adopt innovative strategies and embrace digital transformation.

Investing in insurance app development is the most effective way to begin this transformation. At Itobuz, our Android and iOS app development services have helped many ‘strictly insurance’ companies become ‘Insurtech’ companies. We can help you too!