Insurance is a big part of the mobile ecosystem. In 2013, Warranty Week estimated that more than 60%-66% of smartphones were insured through a protection plan.
Earlier this year, Market Reports Hub estimated the global mobile phone insurance market to be nearly $31B in revenue by the end of 2015.
However, smartphone sales and attach rates are starting to reach a saturation point, and Insurers will need to look at other ways to continue to grow.
Mobile device buyback, on the other hand, has plenty of room to grow. HYLA estimates that less than 20% of people buying new phones sell or trade-in their old phone.
By bundling protection plans with mobile buyback solutions, such as HYLA’s, Insurers can increase consumer attach rates and offer new mobile device buyback services, while leveraging its existing infrastructure used to handle claims.
5 Benefits of Using Mobile Buyback Technology
Implementing a buyback program complements an Insurer’s product offering and benefits its consumers.
- Convenient Mobile Trade-in: Insurers can provide consumers that sign up for insurance with the opportunity to sell their device to them, when the consumer buys a new phone.
- Readily Available Replacement Phones: Instead of stashing old phones in drawers as a backup, like many consumers do, the consumer can use the proceeds of their old phone to pay for the protection plan for their new one. If their new phone breaks, the consumer has a replacement phone, resembling the one that broke.
- Maintained Relationships: The Insurer can also stay engaged with the customer throughout the phone's lifecycle, rather than just during sign-up and claims . For example, promotions showing the value of the consumer’s phone and best times to sell the phone back can provide a channel and information valuable to the consumer at various times.
- Phone Assessment: Mobile device technology can also be used to assess a phone at multiple stages in its life cycle. For example, an assessment of a phone may be useful, so an Insurer knows the true condition of the device prior to underwriting; ensuring previously damaged phones are avoided.
Knowing the condition of the phone before the user makes a claim would also be useful. Detailed statistics can be collected and analyzed to identify failure rates and loss ratios. Furthermore, Insurers can use the mobile technology to uniquely identify a phone during sign-up, which can be later used to validate a claim if one is made.
- Internal Inventory of Used Phones: An added benefit to implementing a buyback program is that the Insurer gains an internal source of phones, for replacements. The Insurer can diversify supply risk and become less dependent on external sources. With channels already established to process broken phones, the addition of a buyback program is minimal with the right technology partner. Insurers may also see price advantages due to increased scale.
How HYLA Mobile's Mobile Trade-in Program Works
With HYLA mobile's buyback solutions, Insurers can also offer customers buyback price guarantees in the future, on certain phone models, allowing the Insurer to be involved when the consumer buys a new phone.
The technology used for buyback also benefits the Insurer’s claims process. With the HYLA mobile buyback solutions, a phone’s condition is automatically evaluated as part of the buyback process. The assessment is done through mobile technologies that can be embedded into the Insurer’s app and without the need for the consumer to go into a store. The mobile technology ensures the Insurer doesn’t pay more than a phone is worth, with valuations based on a phone’s condition.
Being involved with buyback process provides new ways for Insurers to engage with customers and continue growing their business. HYLA’s buyback solutions and mobile technologies offer key differentiators for Insurers, such as guaranteed buyback prices, advanced diagnostics and analytics. The last post in this series will cover how OEMs can benefit by implementing buyback solutions and mobile technologies.
Download this white paper to learn how to create an efficient trade-in program that satisfies consumers and keeps them coming back every time they want to change devices.
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