A vast majority, 90 percent, of insurers recognize the growing importance of the customer experience, and 10 percent said it always has been critical, according to a survey conducted via the Novarica Research Partners Program and underwritten by GMC Software Technology.
Consumers’ expectations for a high-level customer experience now are being set by consumer brands, such as Google, Amazon and Apple, according to the report, and insurers are recognizing the importance of excellent interactions with agents and policyholders, and that low-quality experiences during the sales or claims process quickly can erode customer acquisition and retention.
Of the respondents, 80 percent said they consider both agents and policyholders to be customers. Most insurers consider agents as their primary customers, the report said, and interest in policyholder retention is the critical reason to improve those interactions. However, according to the report, that is a relatively recent interest. Seventy percent of insurers said improved communication quality is a critical driver for improving the customer experience for agents and policy holders; additional drivers for customer-experience improvement include reduced operating and support costs, according to 60 percent of participants, and increased customer retention, also according to 60 percent of participants.
Self-service is a critical area for insurers’ customer-experience strategy, as it can help reduce operating and support costs. The importance of self-service transactional capability rated high, 4.25 out of 5.0 possible, but insurers rated their actual capability as weak, ranking 2.5 out of 5.0 possible. Consistency of user experience ranked 4.5 out of 5.0 in terms of importance, but only 3.4 out of 5.0 in terms of capability.
Most carriers have begun implementing mobile capabilities, but few are addressing emerging channels, such as social media and online video, according to the report. And, for those with mobile strategies, only 40 percent have integrated the strategy with internal customer communications systems. “Insurers need to consider emerging channels in order to prepare flexible systems that provide communication options to customers,” the report said.
Most insurers have an ad hoc approach to the customer experience, according to the report, and ownership is shared among multiple business functions and IT. Governance will increase in importance, Novarica said, in order to “maintain a consistent focus when prioritizing and funding technology initiatives to meet customer experience objectives.”
The study was based on interviews with 10 mid-size North American insurers, including individual and group life/annuities, P&C and group supplemental benefits, with annual premiums between $100 million and $1 billion. Novarica conducted the survey, analyzed the results and independently created the report.
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