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“How can we best be there for our policyholders?” Because this single question is so multi-faceted, it may be the one that regularly keeps the greatest number of insurance professionals awake at night. What does it really mean to “be there” and what is it about the concept that makes delivering on this objective so daunting?
Let’s first look at the typical association between the insurer and the insured. Despite the long-term nature of the relationship (policies are most typically in place for a period of 12 months), the majority of policyholders rarely interact with their carriers. In fact, after purchasing coverage, an individual may never formally contact their insurer again. If they are happy with the coverage they’ve contracted, and their premiums are still reasonable, they may simply renew online and happily not think about their policy—or their carrier—for at least another year. As an insurer, you may not be faulted for focusing most of your efforts on making it as fast, easy and efficient as possible to establish and/or renew a policy. And delivering a phenomenal customer experience at the point of sale or point of renewal can certainly be seen as one of the facets of “being there” for your policy holder.
There’s no question that a great customer experience at the point of sale is definitely important and goes a long way toward building policyholder loyalty. Unfortunately, we know that customer goodwill is not necessarily permanent, and can be all too easily eroded. Some policyholders are extremely lucky and never have cause to file a claim. But for many, accidents are a part of life and at the very least, policyholders want their claims settled accurately and fairly, and in what they believe is a timely manner. When a customer perceives this not to be the case, years’, perhaps even decades’ worth of goodwill can be gone in a flash. Right or wrong, the customer simply believes the insurer was not “there for them” in their time of need. And while there is no doubt that insurers have made tremendous strides in this area, ensuring that customers walk away from their claims experience happy—versus ready to change carriers—requires an effective, cross-operational strategy. It also requires that the best possible decisions are made throughout the multiple processes and subprocesses that drive a claim from FNOL to conclusion. For example, are your fraud detection or subrogation identification strategies adding friction or are they streamlining the process? Today’s insurers are clearly embracing a more holistic approach to the customer experience and employing digital transformation initiatives designed to augment their people, processes, and procedures to arrive at optimal outcomes.
So, has the insurance industry solved its customer experience dilemma? Can our insurance professionals be assured of a good night’s sleep tonight? Perhaps. But there is one other crucial thing to consider: All customers are not the same and the customer experience means different things to different people.
‘Being There’ for Different Customers
We’ve seen repeatedly that customers tend to align their priorities to the type of carrier with which they want to do business and from there, align their customer experience expectations. This also means that the concept of “being there” means something different for different insurer/insured relationships. For example, if a policyholder’s main concern is price, they seek out insurers that can offer required coverage at the lowest premium. Other customers are willing to pay a higher premium to have access to additional perks, such as concierge-type services, new car replacement, and others. Each of these customers have significantly different opinions about what they expect from their customer experience. The policyholder on a budget certainly wants to be treated fairly in the case of a claim, but they are also likely to be more understanding if the claim is settled in weeks versus days. The customer paying higher premiums expects not only fairness, but a fast resolution without what they perceive to be hassles and delays. Knowing its customer base, and their general expectations, will allow insurers to fine tune their customer experience strategies, and the technology solutions they are using to deliver them. Only by doing so will they be viewed as “being there” for their policyholders and get the good night’s sleep they deserve.