Consumer satisfaction with insurance online experience needs improvement

Up until now, online communication with insurance customers was, in terms of customer satisfaction, significantly lagging behind other industries. As a matter of fact, this is  clearly  an aspect of Insurance business with a good potential for improvement.

In order to cope with rapidly changing market environment, insurance companies will require product  innovation  skills,  new  approach to customer relationship management and a clear vision on distribution and communication channels for the future. Many insurance companies will lack the necessary competences in order to perform the above activities, and for the time being they will need to remain open for sourcing these competences from external companies having more know-how and experiences in the field, writes Gorjan Agacevic & Marijan Mumdziev of Amodo

 

 

graph 2

Due to significant growth in social media usage in the last decade, there is no doubt they will play a role in digitalisation of the insurance business, thus should be considered. However, as Amodo research outlined, not every social media channel should be used for the same purpose.graph 3

Social media plays important part in usage based insurance deployments 

Amodo performed a research of 48 existing UBI products currently available on the market, and found that 83% of all insurance companies rely on social media as a communication channel for the UBI products.

Out of available social channels, Facebook is the preferred one (80%) then followed by the Twitter (76%). Facebook is primarily used as a customer service tool and Twitter to raise brand awareness, but less to sell. A smaller percentage of Insurance companies decided to go for Google+ (40%) and LinkedIn (33%). All of these social media channels differ in terms of demographics of the users, user behavior and expectations, etc. insurance companies will have to learn the fast changing “laws” of these channels if they wish to participate and be relevant in an already very crowded and noisy place that is social media.

Depending on the region in which they operate, Insurance companies will have to adapt their digital strategies based on local customer preferences and behavior as well. For example, Twitter and Google+ are popular channels in the United States and the UK, but it are not nearly as popular in Central and Eastern Europe, and therefore should not be considered as a central platform for digital activities in those reagions.

Insurance companies also have to be aware that when it comes to digital and social media, they are among the last to “arrive at the party”, meaning there are already many brands from various industries present in the digital media and they are all competing for customers’ attention.

graph 4

This should not discourage the Insurance companies from entering the digital area – quite the opposite, since it is the insurance companies that with the help of IoT have great potential to be quite useful to the customers, and it is exactly this – a concrete value, that is the most highly sought after commodity online today.

There are many different tactics an insurace company can implement in their digital and social media strategy. Most common ones are, hotline support, educational content, gamification, and others.

Marijan Mumdziev, Partner & Advisor, Amodo
Marijan Mumdziev, Partner & Advisor, Amodo

90% of insurance companies that launched the UBI product also offer hotline support, and 53% of them have also dedicated email address for customer inquiries related to UBI product. Some of the UBI programs, generate periodical reports on the driving behavior progress, which is then sent via email to insurance customers.

One of the key motivators for establishing additional communication channels when it comes to UBI product, is customer education on the new types of product available in the Insurance portfolio.

Gorjan Agacevic, CEO, Amodo
Gorjan Agacevic, CEO, Amodo

This is especially relevant for expectations management, clarification around data privacy and finally pricing mechanics. Some of the other communication methods are also FAQs available on pages of most Insurance companies offering UBI, instant messaging being offered just by a few, messaging through smartphone app and in some cases even establishing the direct telephone line for providing driving improvement suggestions to most risky drivers.

The key to a successful Digital Strategy in 2015, as always, will be finding a unique voice and providing true value. There is a lot of noise in the digital media, but insurance companies with the help of IoT are in good position to become a signal rather than part of the noise.

Comment on this article below or via Twitter: @M2MNow OR @jcm2m

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