How insurers are seeking to deliver a first-class customer experience

January 19, 2023 10:05 AM

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Providing an outstanding customer experience is a top priority for insurers in an industry where the client is always one step away from potential disaster.

And when a catastrophic event strikes, "They don't just need something done, they're looking for empathy, support, guidance, and advice," says Darci Darnell, co-author of "Customer Behavior and Loyalty in Insurance," a report by consulting firm Bain & Co.

Read our roundup for five stories on how the industry is managing the customer experience.

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Customer satisfaction rises despite premium increases

Proactive communication between the insurer and the insured is the likely reason for an increase in customer satisfaction with small business insurance companies in 2022 despite policy price increases, according to a J.D. Power study.

"Customer satisfaction among small businesses has increased this year in all areas we measure despite a near-record level of rate increases across the ten years we have conducted this research," said Stephen Crewdson, senior director of global insurance intelligence at J.D. Power.

The study noted that clients who receive advanced communication of a premium increase are equally as satisfied with the insurer's customer service as those who did not receive a price increase at all.

Read more:

State Farm, Chubb, Nationwide rank highest in customer satisfaction: J.D. Power

Maintaining market share via top customer experiences

Delivering a top-notch customer experience has become a non-negotiable for insurers if they want to retain their share of business in a cutthroat marketplace.

"The insurance industry is highly competitive, with many companies fighting for market share," said David Antoline, president at Active Digital. "Therefore, it's imperative that they deliver best-in-class customer experiences while driving efficiency and providing personal, customized service.

To identify the type of experience customers want from their insurer, Active Digital conducted a study with Harris Poll, which highlighted the importance of personalized digital communication and the value of fast virtual insurance processes among other findings.

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Why improving customer experience helps consumers, employees

Making a good first impression, every time

Whoever said "you never get a second chance to make a first impression" could have been talking about how an insurer responds to a First Notice of Loss: do it well and you have gained a loyal customer for life, do it poorly and your reputation is shot.

But the way an insurer handles such "moments of truth" has just as much potential to satisfy a customer, says Darci Darnell, co-author of a Bain & Co. report on Customer Behavior and Loyalty in Insurance. Indeed, the secret to success is managing every customer episode well during the lifetime of a policy.

"Customers don't report incidents or file claims very often," according to the report, but have many less consequential episodes, such as a request to change a billing address. Loyalty leaders "work hard to constantly improve the customer experience for all episodes."

Read more:

How can insurers improve customer satisfaction

How insurers can deliver a better customer experience

For insurance carriers, the key test of whether they are delivering a good customer experience is how clients feel when they make an insurance claim.

"Insurance is a people-oriented, people-focused business, so it's crucial not to lose the human element," said Mark Snyder claims SME at insurance industry communications platform Hi Marley. "When dealing with people's emotions and vulnerability in a time of need, nothing can replace empathy."

To find out what makes a great customer experience, Hi Marley analyzed nearly 25,000 customer satisfaction surveys across 50 of its P&C customers and was able to identify four key aspects: timeliness of service and resolution; communication; process effectiveness; and adjuster attitude and approach

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What factors drive a positive or negative customer experience?

Why the customer experience is central at The Hartford

Claire Burns, chief marketing and communications officer at The Hartford, considers the customer to be central to all things at the firm and that digital is crucial for preparing the company to face the evolving challenges in the marketplace.

Burns spoke with Digital Insurance to discuss the wide-ranging scope of her responsibilities at the firm and why at the top of the list of goals she is focusing on as she looks ahead is optimizing digital delivery for customers and agents.

Read more:

The Hartford Q&A: Digital customer experience