Insurtech sees its Facebook chatbot pilot flop

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US-based start-up Next Insurance has found that its SME customers are not interested in buying insurance through a Facebook chatbot.

The insurtech recently became a fully-fledged insurance carrier in the US and has around 20,000 customers working in construction and personal training. It currently offers general liability insurance, but has ambitions to expand and do business in every US state. It hopes that the freedom of being a carrier will allow it to rapidly enter other lines of business.

However, following a pilot in March 2017, Next says that more than 90% of its customers purchase their insurance through its website rather than using the bot.

Talking about the share of customers that had purchased insurance via Facebook, Next COO Sofya Pogreb said it was “tiny”.

Pogreb said: “Our learning path is that people are very comfortable with buying insurance through our online portal on our website. Over 90% of people that buy from us buy their insurance through our website without ever talking to a human. People are clearly very comfortable with that.

“People don’t seem to want to buy via a chatbot. If they want to interact with us, they call or email us. We also have a chat on the website. And that is the bulk of our contact. They are comfortable using that. Chatbots not so much.”

While the Facebook experiment may not have been a huge success, this has not deterred the start-up’s investors. Next recently raised $83m in its series B funding round.

Instead of focusing on the chatbot, it is exploring other ways of acquiring customers, such as through partnerships with a personal trainer association.

Pogreb added: “Right now our website is really our focus. We want to make sure that it is easy to use, transparent. That is where we are driving all of our customer acquisitions. We are also looking at partnership as an acquisition channel.”

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