At a time when customer experience is of the utmost importance to insurers, the latest findings from the
Given the glut of recent storms and disasters gnashing at policyholders, and calling to the fore the need for excellent customer services from a claims handling processing perspective, as well as the myriad options now available via social media to monitor, manage and respond to customers, this waning of customer confidence may well be compromising.
According to the
The study found that consumers expressed low confidence in financial providers because they believe institutions lacked shared values, had an inability to provide helpful guidance and advice and offered overly complex product suites. Additionally, 51% believed that financial institutions didn't share the values of their customers, 46% said they lacked confidence that financial services providers kept their commitments and promises, and 52% felt institutions didn't offer clear or simple policies.
The Global Economics of Consumer Sentiment
When breaking down the survey results, CEB found that some distinct regional disparities surfaced.
In Asia, 63% of consumers surveyed had positive or neutral feelings about financial providers, which CEB attributes in part to the fact that large economies experiencing dynamic growth showed the largest percentage of consumers who felt positive about their finances. Conversely, Latin America saw 55% of consumers with little or no confidence in financial providers, despite that they answered positively about their financial situation. European consumers were only slightly more upbeat, with 52% expressing confidence in providers. North Americans, however, generally were more confident in financial providers than the other regions.
"Many people may think that the wake-up call the global recession delivered would have created better alignment between financial institutions and their customers, but the reality is they are far apart and the poor perception of the industry held by consumers is constraining purchase activities and leaves firms vulnerable to new competitors," says Peter Aykens, managing director, Corporate Executive Board. "There is a tremendous opportunity for these institutions to connect with their customers in meaningful ways, and in doing so, increase confidence and loyalty."
Prosperity and Perceptions
The Consumer Financial Monitor also found a strong correlation between satisfaction with financial providers and wealth. CEB says that in many cases, wealth pushes consumers to positive associations about their personal finances, and leads them to a much higher level of satisfaction with financial service providers.
The report found that 47% of consumers with more than $100,000 in investable assets had positive feelings about their personal finances, and 20% of that same group had "a lot" or "complete" confidence in their financial institutions. The results for individuals able to invest more than $1 million in assets rose slightly to 49% and 22%, respectively.
Consumers with less than $100,000 in assets to invest, however, felt substantially worse, with 40% saying they had negative feelings about their personal finances, and 48% saying they had little-to-no confidence in their financial provider.
Life Stage Sways Sentiment
CEB research also found that consumers ages 47-64 had more negative feelings about their personal finances and financial providers than any other age group, despite the fact that they have the most financial services products. This is troubling given the financial needs they face with retirement on the horizon.
Young adults ages 18-29 were more positive than their older counterparts, CEB says, with 49% saying they were either generally neutral about—or confident in—their financial providers. Younger adults also indicated more satisfaction with financial products, but only 28% indicated they proactively manage their finances.
Repairing the Relationship
CEB makes the following suggestions for institutions wanting to rebuild trust with consumers by:
1. Becoming a money coach: Put a personal budgeting tool in consumers' hands that will automatically plug in transaction and balance information.
Consumers who proactively manage their money buy more products and are more satisfied. Additionally, consumers who feel on track financially consolidate their savings with their primary provider.
2. Being courageous: Be transparent about pricing and tout the value of products. A whole generation of consumers has been mistakenly led to believe that certain financial products are low-value commodities and should be free. Institutions need to remind customers of the value and convenience of core products and provide a rationale for the fees associated with them.
3. Listening to customers: Equip staff with simplified sales processes that incorporate the lost art of listening to customer concerns and needs.
