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Customer engagement key to driving value in insurance

Helen Murray, Chief Customer Solutions Officer at Webhelp UK, argues customer engagement is key to turning insurance from a community into a valued service. This article was also published on Post Online.

The relentless growth of the aggregator market has changed the game for insurers. With consumers now able to compare policies at the click of a mouse, you’d be forgiven for assuming offering the lowest price was the only way for providers to remain competitive.

However recent research suggests otherwise. According to a survey by from 1 to 1 media and KBM group, customers are less likely to defect to a competitor offering a lower price if they feel ‘engaged’ by their insurer.

So how can insurers develop this sense of engagement and ensure customer loyalty at the point of renewal?  The answer is really quite simple – clear, consistent and compelling communications at every stage of the customer lifecycle.

From the start insurers can foster this sense of engagement by being transparent about exactly what a product does, and doesn’t. This builds trust which can be developed by being clear on how and when premiums will be collected, and remaining on hand to respond to sign-up queries.

Once on board customers should also be given regular updates, tailored to their likely product life-stage requirements. Not only does this develop trust, but it also creates valuable cross-selling opportunities.

Engagement can also be promoted by ensuring queries are resolved promptly with helpful advice. While customers’ accounts should be reviewed at the point of renewal and timely reminders, identifying potential savings of more appropriate products, should be issued.

Most importantly, customers derive no greater sense of engagement than from an insurer that resolves their claim promptly, with a clear explanation of the process and the eventual decision.

Insurers have already devoted considerable efforts to operating with clarity, transparency and developing trust with their customers, but there remain significant opportunities to improve customer experience, particularly through digital and self-service channels.

Visiting a general insurer in Europe recently, I was struck by the impact advanced digital channels, including webchat, mobile and social media, had had in reducing running costs to 20% of annual premium income, while boosting its Net Promoter (NPS) and customer satisfaction scores (CSat) to the highest in its national market.

Together with a customer churn rate well below the industry average at just 20%, this is clear evidence, if any were needed, that efficiency and customer engagement can go hand in hand.

And the UK industry is starting to take this seriously. The 2013 Global Contact Centre Benchmarking Report suggests the UK’s top performing insurance providers already handle 35% of customer interactions by digital channels, while 11% have integrated social media into customer service delivery.

However, the bottom line is it doesn’t matter how many communications channels an insurer provides for customers, unless the experience delivered across them is consistent, compelling and designed to encourage that crucial sense of ‘engagement’.

Achieving this means understanding exactly which elements of the existing customer experience work, and which don’t.

This can be a lot easier than it sounds – all it takes is the simple application of analytics to the customer journey. From ensuring information is consistent across channels to reviewing how efficiently and satisfactorily claims are resolved, analysis can identify where customer expectations are not being met allowing insurers to plug any gaps.

There are those who believe the insurance industry is irretrievably commoditised.  I’m not among them.  By striving for customer engagement, I believe insurance providers can turn ‘a commodity’ into ‘a valued service’ customers will almost certainly be prepared to pay a little more for.

Our latest white paper Insure Against Loss examines in detail the opportunities in the insurance sector. In this paper we will explore how delivering an exceptional customer experience can increase customer engagement levels and reduce customer churn.

Get in touch with Helen on LinkedIn with your comments or questions.


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