The Most Difficult Insurance Customers

One of the main UK newspapers has just published the best – and worst – UK insurers based on customer surveys. The scoring was based on communication, speed to settle a claim, helpfulness, value for money and overall service. Those at the top of the list will be invariably patting themselves on the back, and those at the bottom of the list will have some soul searching to do -- a bit like the England team that crashed out rather unceremoniously from the World Cup in Brazil and failed to reach the knock-out stages of the soccer championships. Of course, the problem wasn’t the quality of the England team, but rather the quality of the opposition -- and in that spirit, let’s not think about the quality of the insurers in the survey but rather the quality of their policyholders. We used to think of policyholders as all being pretty much the same. One size fits all. But the insurance industry has increasingly realized through customer analytics and micro-segmentation that actually there’s a lot of diversity among their existing and potential customer base. In terms of buying behavior, insurers are starting to use segmentation that is much more familiar to our retail colleagues. At a major multi-industry conference, the head of innovation for a global insurer spent all his time in the retail workstream. "I know what my competitors are up to," he said. "Here is where I will find my advantage." Obviously, we know which are the most costly customers in terms of risk and product. But with all the big data and analytics captured, has any organization identified which are the highest-maintenance customers, the ones who are most problematic to cope with, especially at the point of claim when, if it’s going to go wrong, that’s when it will happen? My own opinion – entirely based on 30 years of experience and without a hint of analytical insight -- is that the most difficult insurance customers are, in no particular order, teachers, policemen and retired insurance professionals. Journalists come in pretty close, as well. With three of the four, it’s probably a question of having an inquiring mind and wanting to understand the basis of every decision. With insurance professionals, I suppose that means you and me. I’ll leave you to figure out why we're so difficult…