There’s something insurers can do to improve customer relationships

Relationships are important in any business – whether with customers, suppliers, partners or other stakeholders. For Canadian P&C insurers, poor customer relationships are the very thing holding them back.

EY recently issued its second survey of insurance customers. Results show that a low trust rating of P&C insurers (56%) is partially to blame for high customer turnover. To put this in perspective, that’s a lower trust rating than pharmaceutical companies (59%), car manufacturers (68%) and banks (73%). It’s also lower than insurance companies globally.

It’s fair to say that by nature, insurance products are out of sight and out of mind. Once an insurance policy is set up, customers don’t give it much thought unless they need to make a claim. With so few customer interactions, it’s critical that insurers take each one as an opportunity to strengthen customer relationships and build trust.

Still, continuously building positive customer relationships is easier said than done. What consumers are looking for are strong, mutually beneficial relationships with two-way communication. Insurers committed to pouring more energy into their relationships with customers can see their efforts translate into profits.

Besides better, personalized, and more frequent communications, digital channels are also a big part of the solution. Eighty percent of Canadian P&C insurance consumers would use digital and remote channel options for different tasks and transactions. To stay relevant and enhance personal interaction, insurers should develop flexible and multichannel contact options like online chat, video tutorials and mobile apps.

Companies should invest time and resources to identify which channels customers want to use and how they want to use them. One way to do this is through pilot programs for specific product lines or regions, which can help build the business case for updating and optimizing distribution channels and service models.

Other steps insurers can take to improve their customer relationships are:

• taking responsibility for the overall health of all customer relationships
• greatly improving their customer intelligence by embracing advanced analytics
• acting predictively, precisely and nimbly in advance of key decision points
• being “easy to deal with” by offering relevant and timely solutions during critical interactions

Moving forward, we’ll see leading Canadian insurers reinventing themselves as customer-focused companies. Future industry game-changers such as telematics and wearable technology give even greater reason for change, to help insurers serve the customer of the future.

For many companies, the move to customer-focused business won’t come easy, but the effort will pay off in the long run.

You can learn more about the survey findings by reading EY’s Consumer Insurance Survey: Reimagining customer relationships. An infographic of key survey findings is available here.