Product benchmarking is a process of comparing the features, performance, and other characteristics of one product to those of similar products in the same market. This can be useful for 1) determining the relative value of a product and 2) identifying opportunities for improvement.

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In the context of insurance products, benchmarking may involve analyzing market trends, comparing coverage, premiums, internal rate of return (IRR), and the financial strength of insurance companies (e.g. capital adequacy ratio).

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The analysis also includes the movement of new products which just launched or withdrawn.

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A recommendation strategy can be developed based on this analysis to help businesses and consumers make informed decisions about which insurance products are the best fit for market.

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Example of working process

•  Perform mystery shopping to collect all information

•  Get insight information through networking

•  Crystallize the product strategy based on advantage of the company

•  Provide the rating score cards (e.g. IRR and Non-IRR) of each product type

•  Communication and presentation to senior management

 

Deliverable items

•  A benchmarking report based on product comparisons by each product type

•  Rate the competitiveness of each product and product category among competitors (other insurers selling similar products through similar channels)

•  The competitiveness does refer to the following aspects:

    -  Premium rates

    -  Product features/terms and characteristics

    -  Product delivery and customer service

    -  Insurer’s financial strength through CAR ratio and credit ratings

    -  Any product gap that the company could fulfill to increase the advantage

•  Update new product launch/movements of competitors including their strategy (i.e. movement including withdrawal product)

•  Provide recommendations to senior management to increase its competitiveness

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