Mobile and Social Media Channels Gaining Traction

The world of insurance has been changing at an ever-increasing pace.  Gone are the days when carriers could establish a product mix, develop technical solutions and ride the wave for decades.  Now, insurance carriers need to continually reinvent and transform themselves to create, maintain or close a competitive gap.  A key strategy that carriers can focus on is providing better customer experience (to improve retention) while driving operational efficiencies (to reduce costs).  However, the approach is proving more challenging than insurers are prepared to address.  The dilemma facing carriers is whether to change strategies or to change the approach to that strategy.

Mobile and social media channels have emerged as an approach that carriers are increasingly focusing on and can provide the greatest opportunities over the next two years to both improve customer experience and operational efficiencies.

As insurers learn more about their customers through a comprehensive approach, they are learning that customer experience is a much more relevant measure to use in getting a true picture of customer satisfaction across products, channels and the entire customer lifecycle, whereas customer satisfaction is only a 1x measure, taken at a single point in time.  For customer experience, we measure 96 touch points between an insurer and their customer and distinguish between positive, negative and neutral experiences.

In summary, customer experience has provided carriers with new insights into their customer base and loyalty. The findings include:

  • Retention risks are highest for customers having a negative/neutral customer experience.
  • Across every country, insurers’ positive customer experience ratings are much lower than their customer satisfaction levels.
  • Even in the US, where the customer experience rating is the highest, there are still more than 50% of customers at risk of retention, indicating significant opportunities exist to improve experience levels based on the areas customers say matter most.
  • When compared to their banking brethren where interaction points are much more frequent, insurers have marginally lower customer experience ratings. Banking’s higher customer experience ratings indicate that best practices in data analytics, market segmentation and cross-channel integration are being implemented.
  • Online channels are now preferred by insurance customers for activities like finding best price and comparing policy coverage, but customers prefer physical distribution networks (agents and brokers) when it comes to gaining trust.

Mobile is a model in which customers are interacting with suppliers of goods and services, and carriers have the opportunity to shape the interaction of the future. Mobile is gaining traction in a number of customer interactions, especially on the research and servicing side, creating a need to include it in the value chain.