Much like any other service-driven industry, insurance companies rely on customer satisfaction to stay in business. If customer satisfaction is low, insurers are at a significant risk to lose their customers to competing companies. Customer loyalty is no longer what it used to be, either. Forty percent of policyholders are unhappy with their current provider and they are considering switching to a new insurer within the year.
This is a significant risk for a few reasons. Insurance companies could see $400 billion in insurance premiums switch hands over the span of one year. That is a significant amount of destabilization in the industry. While some insurers may benefit from the change, many cannot withstand such a significant change in finances. One-fourth of customers are also willing to cancel an existing contract regardless of fees or penalties. Compounding this problem, customers are willing to shop online to purchase insurance rather than using their existing provider.
Stemming the Loss of Customers
Customer satisfaction is the key to loyalty. If customers aren’t happy, they have no incentive to stay with their existing insurance company. The following are several ways insurance companies can increase customer satisfaction:
- Offer personalized services. Customers dislike when they call their insurer to discuss policy options and a representative directs them to a website for assistance. Customers want personalized services so they can feel secure in their insurance policy decisions. While insurers may balk at this notion citing additional time and cost, 41% of customers are willing to pay extra for this level of care and service.
- Offer affordable solutions. Continuing with the above, just because customers are willing to pay more for personalized services doesn’t mean they are willing to overlook their policy’s price tag completely. Not all customers can afford Cadillac policies with all the bells and whistles. Many need realistic coverage that makes them feel safe in the event of a claim without gouging their checkbook.
- Up to date technology. Customers expect to be able to access information about their claim from any device, at any location, anytime they want. This means insurance solutions need to be mobile friendly including an app for ease of access.
If your insurance business is struggling with customer satisfaction or noticing problems with customer retention, Actec can help. Contact us to learn how our innovative FNOL solutions can help your company today.