Ensuring Your Success in the Digital Insurance Space
Disruption is the name of the game in our highly connected, digital world. The insurance industry is no exception. Despite the decline in the number of insurtech start-ups that cropped from 2018 to 2019, a report by Deloitte confirmed that insurtech funding reached a new high of $3.3B. Another report by Financial Times pointed to the insurance sector’s need to innovate to avoid the fate of traditional retail, travel, and banking outfits that failed to ride the wave of technological advancements.
It is, in short, an industry ripe for disruption in the coming years. So how can insurance companies of today benefit from disruptions of tomorrow? Perhaps the most important thing is knowing one’s audience if an insurance company aims to make an impact on its customers’ lives. Disruption is wasted on an uninterested audience, so knowing who we are selling insurance to and predicting what they want out of insurance products is paramount.
Know Your Policyholders
According to GlobalWebIndex, the most typical car and home insurance buyer in the US is male, between the ages of 36-54, lives in the suburbs, and is in the middle 50% in terms of income level. However, women and millennials are not far behind, with the latter being the second largest peer group who buy a home and car insurance. It is not surprising, then, that car insurance purchases outnumbered home insurance purchases, and that more than half of insurance buyers do not own property. Additionally, 24% of Americans who purchased insurance did so online.
The shift in online insurance purchases will only grow, with more than half of Gen X and millennial policyholders having shown a high interest in the latest technologies. The smartphone is also the most owned device by American insurance buyers, with Facebook, YouTube, and Instagram as their most visited social media platforms. At least 29% of American insurance buyers spend 1-3 hours online daily.
Getting a slice of that 1-3 hours spent daily is crucial. While 48% of American insurance buyers discover brands via word of mouth, a comparatively large number also discover brands through search engines and social media. They are also 1.4x more likely to research a product via consumer reviews and brand websites. However, their purchase decision will still likely be based on discounts and coupons.
Customer Service is Still Key
American insurance buyers are 1.4x more likely to recommend a product based on the quality of customer service they received. This poses a great challenge for insurance companies, as social media has become a new frontier for brands trying not only to reach and engage potential customers, but also to provide fast and efficient customer service. However, Praxidia’s research reveals that top American car and home insurance companies took longer than the ideal 10-30 minutes before responding to customers on Facebook and Twitter, with one company taking almost 11 hours on average. These insurance companies all responded to less than 70% of online queries and concerns and tended to avoid responding to negative mentions.
The world of smartphone apps is yet another space where insurance companies must fight to get the loyalty of their customers. Based on six insurance apps Praxidia reviewed, only two had a star rating above 3.5, and the average star rating for the six apps is 2.95. Insurance companies also tend to have a lower rating on iOS than on Android. This data means that a lot of work is still needed to get the confidence of tech-savvy policyholders in an insurance company’s digital offerings. Aside from providing the most cutting-edge features, focusing on making apps smooth and easy to use will go a long way in making customers think that a company cares about them.
Another consideration for insurance companies is engagement with app reviewers, especially in platforms (e.g., Google Play) where it is allowed to respond to reviews. At least 6.43% of the 1,027 reviews from the six apps monitored by Praxidia were related to customer service. Although minuscule, it would still have an impact on how an insurance company will be perceived in terms of how it handles customer issues.
Take Preemptive Measures
In the end, it all boils down to offering great products hand in hand with great service. If insurance companies can fill their customers’ ever-growing digital needs while making their lives easier, then they can trust that customers will reward them with loyalty. For example, the relatively new practice of insurtech companies preemptively filing claims for policyholders to quickly settle problems, as well as using data to predict emerging risks or adjust premium prices (e.g., give a discount on car insurance if the policyholder drives safely based on telematics) will show customers that insurance companies are using new technologies to help them, not to take advantage of them.
Want to know how to get started on improving your customers’ digital experience? We can help.
Through Praxidia, Teleperformance offers a wide range of solutions to customize your digital strategy, from social media analytics and engagement to community management. Our team of social media experts can help you find the pulse on what your customers want, be it feature requests for your apps or the types of insurance products and innovations they seek.
Together, we can redefine your customers’ journey and build their brand loyalty. Contact us today.