January 19, 2023
As the insurance industry continues to evolve, customer experience has become an increasingly important factor in the success of insurers. Consumers are becoming more tech- savvy and have come to expect a seamless customer experience when it comes to their insurance policies.
For most insurers, the customer experience is split across several different silos, including customer service, underwriting, product design, and claims. This makes it difficult to have a unified customer experience across all channels. To solve this, insurers should focus on creating a holistic experience that is consistent across all of their products and services.
The Need for Touchless Digital Servicing
A growing number of people prefer to access policy information and manage transactions digitally, which is leading to a rise in demand for “touchless” digital servicing. This means that customers expect to be able to access policy information and handle transactions quickly and easily, without having to speak to a customer service representative.
Insurers should strive to provide customers with a touchless digital experience. This can be achieved by offering digital self-service portals for policyholders to easily access their policy information and handle transactions.
Why a Unified Experience Matters
Having a unified customer experience across all products and services is essential for insurers. Although we may think of the experience as siloed, it doesn’t feel that way to the policyholder. From the policyholder’s perspective, it has one experience with an insurer, and it should be consistent across all products and services.
A unified experience allows customers to access policy information and handle transactions quickly and easily, no matter what channel they are using. A unified experience also helps insurers build relationships with their customers, which increases retention and ultimately the insurers bottom line.
What: Customer experience is a massive differentiator for insurers. It not only increases retention, but leads to referrals and higher success rates for cross-selling. Given the benefits, customer experience should be a CEO- and board-level priority for insurers.
Quote: “McKinsey’s global research across industries shows that improving the customer experience can do far more to drive profitable growth than raising advertising spending or lowering prices. Some executives may still see insurance as a low-engagement, disintermediated category, but analytics prove that in an industry where profits are highly concentrated, leading carriers are delivering customer experiences that inspire loyalty and attract new customers frustrated by their experiences with their current carriers.”
Why it matters: We’re currently in a period of increasing premium due to inflation. Because of these increases we expect a growing number of policyholders to switch carriers. Insurers with high quality customer experiences can expect to have higher than average retention rates and growth via word-of-mouth referrals.
Read: The growth engine: Superior customer experience in insurance | McKinsey
What: The pandemic has caused people to reevaluate their relationships with insurance companies. They now expect positive, seamless interactions. Insurance companies should be focusing on customer loyalty and retention to avoid high customer acquisition costs. Keeping policyholders happy has become a necessity.
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