Insurance companies: Are you keeping too quiet to keep your customers happy?
Let’s face it. People don’t enjoy paying insurance premiums.
For protection insurance – such as term life, critical illness or accident cover, they clearly see their money going out each month or year. But it’s so easy for them to overlook the value they get in return for that money.
Of course, when they first take out their cover, your customers recognise and enjoy the peace of mind they are buying for themselves and their loved ones. But as the months and years pass by without any need to claim, it’s no surprise that they start to forget about that important core benefit – and question what their premiums are really doing for them.
This is where customer communication can be a powerful and highly profitable tool for insurance companies to use. Relevant, personalised communications, that remind your customers of the security you are providing, can reduce policy lapse rates dramatically.
And if, at the same time, you include a well targeted, personal offer for your customers to increase the level of their protection, many of them will be delighted to take advantage of it.
In short – effective customer communication can boost sales in addition to boosting customer retention.
At Riverside, we know this is so because it is precisely what we have been doing since we were formed back in 2005. We help insurance companies around the world to target and deliver engaging, relevant communications that reinforce the customer relationship and sell more business.
In fact, the programmes we run typically reduce overall policy lapse rates by between 12% and 30%. And that’s on top of delivering additional policy sales from up to 30% of all customers included.
And yet – despite these often dramatic results, we still encounter some insurers who are reluctant to communicate with their customers. There are various reasons for this, including a view in a number of companies that customers simply don’t want to hear from them.
But that is just not the case.
The EY Global Consumer Insurance Survey (across 24,000 customers in 30 countries), for instance, concludes that “consumers want more frequent, meaningful and personalised communications from their insurance providers”.
And today, in our increasingly digital world, consumers expect very open and detailed information about the companies they deal with and the products they use. This presents profitable opportunities for insurers to provide more frequent and relevant communication about the value they provide at all times – not just in the event of a claim. Please see below.