Customers expect great experiences, yet they’re often getting the opposite. According to Broadridge’s 2023 CX and Communications Consumer Insights report, only 11% of policyholders think their insurer is among the best in providing a good experience when compared with other companies they do business with.
Customer dissatisfaction can directly affect the bottom line. In fact, the majority of surveyed consumers (65%) have cut spending with companies that don’t meet their customer service expectations. What’s even more alarming is that the dissatisfaction trend continues: 69% of consumers indicated that most of the companies they do business with need to improve their customer experience (CX). That’s up from only 35% in 2019.
There are steps you can take to improve your CX while controlling costs. But before doing so, it’s critical to understand two vital components to enhancing the customer experience: communicating with policyholders how they want, and then leveraging technology to deliver communications how and where they want them.
First and foremost: Keep things clear
Communications play a central role in overall customer experience. For instance, policy documents, premium invoices, claim notifications, policy updates and renewal reminders may collectively represent a policyholder’s most frequent points of interaction with an insurer.
Perhaps most importantly, communication affects a consumer’s perception of a company: About three in five consumers (61%) judge a company’s level of innovation based on the communications they send. Consumer feedback on the clarity of communications across industries indicated that insurers rated poorly, with more than a quarter of policyholders confused by communications from their carriers.
Considering that more than two-thirds (69%) of consumers look elsewhere for similar products or services after just two to three poor experiences, you must ensure that policyholder communications are clear and have a modern design.
See also: Payoff From Great Customer Experience?
The role that digital can play for policyholders and insurers
Consumer appetite for digital communications has grown, but so have consumer standards.
Only 41% of policyholders reported receiving paperless insurance communications, but a further 11% would prefer to. Many insurers would prefer that their paperless adoption rates get even higher than that. While some policyholders will always prefer to hold on to paper, we found that 82% of consumers would go paperless if they found the digital experience more engaging.
How can insurance companies provide more value to their policyholders? Eighty percent of consumers want companies to customize their experience based on what the company knows about them. Nearly a quarter would like an interactive summary of important billing or statement information directly within the emails sent to them, instead of being prompted to log in to company websites.
These are just a few ways you can do more to harness the power of customer data. And, by leveraging technology to provide this level of customization, you can provide policyholders with the value they seek.
Customers want simple interactions
There’s work to be done in making insurance communications more useful. Ninety-two percent of consumers said it was important to have a simple way to interact with companies across all channels – with 57% considering it very important. Yet only 35% of consumers believe the companies they do business with are actually providing a simple way for them to engage across channels.
When asked to indicate what was most important in the print and digital communications they receive from companies, respondents had three simple requests:
- Use plain language
- Summarize important information
- Let customers choose how to receive communications
With these findings in mind, insurers may want to consider:
- Using simplified language — a sixth-grade reading level is recommended
- Taking a policyholder-first approach to how communications are organized and presented
- Offering a good preference management tool for policyholders to set their communications preferences
In the words of one survey respondent, “Keep it simple, be honest, be informative and tell me the most important things first.”
Keep customer data a secret (but don't hide your security efforts)
Enhanced digital experiences and trust go hand in hand. Privacy and data security are top of mind with consumers, especially when they’re deciding whether they can trust a company. In fact, 42% said they stopped doing business with a company because of a hack that exposed consumer data.
It’s not surprising that 62% of consumers agree that the use of digital identity security measures — like Face ID and PIN codes sent via email or text — would make them more likely to engage digitally with a company. Another survey respondent said companies should “provide more electronic security” to improve the experience.
It’s vital for insurers to not only provide adequate data security, but to communicate about those measures to reassure customers. Almost a third of respondents said the most important feedback they’d give to companies is to be more open about how they protect consumer data and privacy. The more you can tout the steps you take to keep customer information safe, the likelier they are to hear you.
Look to the leaders
To get better at communications and CX, look at who’s doing it well. Insurers looking to elevate their CX may want to consider what banks and credit card companies are doing. Specifically, survey respondents said that these industries:
- Make it easy to navigate account details online (43%)
- Communicate clearly (43%)
- Make it easy to talk to a real person (41%)
- Send notifications when there’s something important to look at (34%)
- Allow customers to select how they want to receive communications (25%)
You don’t have to reinvent how you communicate with your policyholders. Instead, consider how these best practices would fit within your organization. Much, if not all, of the top-scoring traits are replicable across industries. Mutualized solutions can help here: They allow you to free time and resources while providing you with market-leading tools to make your communications ecosystem run more efficiently, leading to the ability to create better experiences.
See also: 'It’s the Customer Experience, Stupid'
Takeaways for insurers looking to elevate their CX
Taking these steps can be a win/win for insurers and policyholders alike. For instance, leveraging technology to streamline processes through automated solutions can make an insurer more efficient, while improving the policyholder’s CX. And the Broadridge survey indicated that insurers don’t have to shoulder the financial burden alone. In fact, 44% of consumers indicated their willingness to spend more to receive a better customer experience and service.
Carriers can also turn to outside vendors to help create the solutions that both insurers and policyholders need. Outsourcing this function can help them gain economies of scale, workflow efficiencies and cost reductions — while leveraging the latest technologies to enhance CX.
Insurers that take the right steps today to provide a better customer experience will benefit from enhanced policyholder loyalty — and the resultant higher persistency rates, which are key in today’s challenging economic climate.
