Customer Experience In Insurance Industry: The Future

Maciej Wir-Konas
November 30, 2023

As an experienced professional, you've seen the shift in customer expectations and market dynamics. Today, success in insurance means embracing technology, personalization, and customer-centricity.

Less than 1/3 of insurance customers are happy with their current insurer. One negative experience makes 50% of customers leave.

This article offers insights and strategies for navigating this transformation, challenging traditional paradigms, and positioning your company at the forefront of the industry's future.

Insurance Digital Transformation - The Shift in Customer Experience

The insurance industry has seen a significant shift towards prioritizing customer experience, catering to the needs of a more tech-savvy clientele. Unlike the past, where direct interactions were the norm and personalized experiences were limited, today's insurers are adopting digital channels to provide tailored omnichannel experiences that meet policyholders' unique needs throughout their journey.

Also, the level of digitalization, the development of the Internet and social media made information and feedback all the more accessible for customers to leave and share with each other.

Investment in CX tools is rapidly rising, from 1.1 percent of gross written premium (GWP) in 2018 to 1.5 percent of GWP in 2022, an increase of 36 percent.  85% percent of respondents are deploying CX to at least a moderate extent everywhere, while about two-thirds are significantly focusing on customer service, claims, and the phases of customer onboarding.

Traditional vs. Modern Customer Service

In the past, insurance customer service was predominantly face-to-face, which could be inefficient and lacked immediate access to information. Modern insurance companies have shifted to digital customer service platforms, trying to provide omnichannel experiences that align with customer expectations.

41% consumers would consider switching insurers

An omnichannel engagement strategy can significantly improve customer loyalty. More than half of customers use digital channels like websites, mobile apps, or call centers, in addition to traditional methods such as visiting branches or contacting agents. This shift presents insurance firms with opportunities to enhance retention rates and overall profitability.

Clients start with one channel, usually on their own, and they need help thereafter. 75% though report troubles while trying to purchase an insurance policy online. Around 60% of customers switch channels before the purchase. One in six receives no follow up after the initial discussion. Of those, who do hear back, 40% contact two or more people regarding the same case.

Having easy access to the same insurance application in multiple channels has numerous benefits:

● it speeds up the process of managing policies and claims,

● it keeps the cohesion in the communication with a customer,

● it helps avoid causing a frustration to a customer waiting for an employee to check something or request information.

The Expectations of a Modern Insurance Buyer

Personalized Offers

A research by Accenture shows that: "Insurers that offer personalized experiences and products that are tailor-made for their customers see an 81 percent increase in customer retention and an 89 percent increase in customer engagement".

50% of customers value personalized approach and communication from insurance carriers, while only 17% of insurers prioritize personalization.

88% of customers demand a personalized offer, and 21% of insurance customers say, that insurance carriers do not personalize their offers whatsoever.

Digital Service

34% prefer a mobile app for policy claims, payments, and disbursements. 71% of customers older than 55yo expect digital processing of their claims via voice or chat instead of having to manage it in person. 68% consumers would be keen on downloading and using an app from their insurer.

Lifestyle-Based Offers

In a survey conducted by PwC 67% of participants answered, that they would not mind a sensor attached to their car, if it meant a lower insurance premium. 69% of people surveyed would share personal information for a lower premium. 70% of drivers want "pay-as-you-drive" insurance.

It makes sense. Drivers that are driving rarely or carefully according to traffic regulations deserve smaller premiums than "roadhogs", even though both caused no accident. Simply because the risk of an accident happening for the latter is higher, and after all the insurance premium is based on risk.

The same goes for life and health insurance policies. A person who's taking care of their health – exercising, consuming healthy food, not smoking, and avoiding stress is less likely to die or get ill. Thus, the risk of an insurance event is lower and the premium should be lower as well.

Also, recognizing and rewarding your customers for their behavior fits perfectly in the tailored offer expectation.

The Role of Customer Service Representative in an Insurance Company

An insurance company's customer service representatives are vital for enhancing insurance customer experience. 47% of customers pick up the phone to speak with a representative directly, when a problem occurs.

Harnessing Technology for a Better Experience

To stay ahead, insurers are integrating advanced technologies to enhance the customer experience. AI virtual assistants are becoming commonplace, offering 24/7 support and streamlining customer service by providing quick and accurate responses to inquiries. Data-driven personalization allows insurers to tailor their services to the individual needs of each customer, leading to more effective and personalized interactions.

Chatbots and Mobile Apps

Gartner predicted, that the usage of chatbots in the insurance business by 2022 will be at 70%, compared to 15% in 2018. It is predicted that by 2025 95% of customer interactions will be powered by chatbots.

44% of customers are comfortable using chatbots for insurance claims, and 43% prefer them for insurance applications. This indicates a growing acceptance of chatbots in handling essential insurance processes.

Use Cases of Insurance Chatbots:

● Tailored insurance plans.

● Demystifying insurance jargon.

● Accelerated claims processing.

● Instant access to policy details.

● Streamlined customer qualification.

● Seamless payment management.

● Real-time customer feedback collection.

The integration of chatbots in the insurance industry is poised to significantly enhance customer experience by providing faster service, personalized solutions, and efficient management of insurance needs. For insurance companies, chatbots offer a way to be more effective and efficient in serving customers, while also reducing operational costs and improving data analytics capabilities. As the technology evolves, its adoption in the insurance sector is likely to become more widespread, fundamentally transforming how customers interact with their insurance providers.

Internet of Things (IoT) Solutions

The use of Internet of Things (IoT) devices is also on the rise in the insurance industry. These devices provide valuable data that can help insurers assess risks more accurately and offer more personalized policies.

For example, in auto insurance, IoT devices can monitor driving habits to help determine premium rates. Automatic AI-powered road accident notification systems are a thing right now. In home insurance, they can detect potential risks like fires or leaks, allowing for quicker preventative measures.

What's more, an IoT device (like smartwatch or smartband) with GPS localization could trigger a message whenever an insured stays near a hospital.

Insurance Management Software

Also, the integration of insurance management software becomes a game-changer, facilitating a seamless flow of information and enhancing decision-making processes.

With insurance digital transformation, carriers are equipped to deliver services that are not only efficient but also aligned with the evolving expectations of the digital age, namely:

● one-click policy buying,

● omnichannel communication,

● accessible, simple payment processing,

● in-app policy and claims management,

● lifestyle-based premium calculation.

Moreover, insurance software solutions help in automating routine tasks like:

● Lead Generation and Engagement - Automation tools capture leads from various sources like websites and automatically initiate follow-up actions, such as sending personalized emails.

● Lead Conversion - These systems nurture leads through automated marketing campaigns and regular contact reminders, moving them towards conversion.

● Call Tracking - Call tracking records conversations and extracts key data, ensuring no information is missed during client calls.

● Data Entry - Automation in data entry reduces manual input, for instance, by automatically updating client information from integrated sources.

● Email Marketing - Automated systems schedule and send out targeted email campaigns to different segments of the customer base.

● Personalized Client Communication - Tools automatically personalize communication like emails or texts to each client, enhancing the customer experience.

● Customer Onboarding - New clients receive automated welcome packets, emails, or newsletters, ensuring a smooth onboarding process.

● Market Segmentation - Automation software segments contacts based on demographics and sends targeted marketing campaigns to each group.

● Customer Feedback - Systems automatically send out feedback surveys to customers, aiding in service improvement.

● Social Media Marketing - These tools schedule and post content across various social media platforms, maintaining consistent online engagement.

● Campaign Tracking - Automated tracking of marketing campaigns provides insights into their effectiveness and areas for improvement.

● Policy Management - From application to renewal, policy management is streamlined, including automatic notifications about policy status.

● Regulatory Compliance - Automation ensures compliance with industry regulations, including automated checks and report generation.

● Underwriting - The underwriting process is expedited through automated data collection and risk assessment.

● Claims Processing - Claims are processed more efficiently, with systems automatically gathering necessary data and validating claims.

Automation can reduce mundane, routine agent work by 80%, and shorten claims processing time by 50%.

Also, as of now 25 cents of each dollar of premium is consumed by expenses. Automation can reduce that cost by 80%.

Automated Data Collecting

All of the above – chatbots, IoT devices, and insurance management software – make for a network system of collecting valuable data. As mentioned before, although the technology changed in the past few decades, many insurance companies still rely on surveys as a tool of obtaining information.

Data will allow agents and call center support employees not to ask the same question twice.

Sometimes it takes something so simple like birthday wishes to your client to build strengthen a relationship.

Agent Portal As a Tool For Improving CX

Decerto's Agent Portal is presented as a multifaceted tool aimed at enhancing customer experience in the insurance sector. Its primary function is to streamline operations and improve interactions, thereby helping insurance professionals meet customer expectations in a dynamic, technology-oriented market.

Read more about Agent Portal

The portal offers various features to boost productivity and efficiency, including real-time data analytics, advanced reporting, and a user-friendly dashboard. These tools provide insurance agents with a comprehensive view of customer interactions across different channels, aiding in understanding customer behavior and enabling personalized service.

Moreover, the Agent Portal incorporates automation features that simplify routine tasks, giving professionals more time to address complex customer needs and build relationships. For insurance companies, it offers insights into the performance of staff and opportunities for improvement.

From an agent's perspective, the portal aids agents in managing key client-related tasks and offers insights into client policies, which can be leveraged for cross-selling opportunities. The emphasis is on delivering exceptional care to clients, fostering satisfaction, and ultimately driving referrals and business growth.

Order Agent Portal for Your Insurance Company Today

The Agent Portal transforms data into actionable insights, streamlining processes for insurance professionals and fostering stronger client relationships. It simplifies policy sales, ensures meticulous client care, and opens doors for effective cross-selling.

By minimizing errors and maximizing efficiency, the Agent Portal not only enhances customer satisfaction but also boosts your team's performance.

Ready To Elevate Your Insurance Services?

Embrace the power of the Agent Portal and redefine your customer experience.

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