How to improve customer experience in the insurance industry

The insurance industry is changing. New laws and regulations are implemented regularly, there are new systems and technologies being developed and acquisitions / business structure changes simmering away under the surface.

One thing that’s not going away is customer experience. After all, the customer should be the heart of the industry – helping provide cover for any ‘what ifs’ that come their way.

The importance of customer experience in the insurance industry is increasing, as customers begin to differentiate between standard businesses and those that go above and beyond. And they’ll reward outstanding customer service with increased spend, loyalty and referral. Can the industry really afford not to prioritise customer service?

Technology is advancing

Our research shows that 60% of consumers prefer to communicate by email, closely followed by 53% who prefer to communicate in person or over the phone. The percentages aren’t vastly different, showing insurers and brokers should offer a range of communication options to suit different customers.

Stats show there is 43% of automation potential in the Insurance and Finance industries. While the world might not be quite ready for a fully automated system, 26% of consumers (the highest proportion of respondents) want to deal with mainly real people with some level of automation.

AI, Machine Learning and automated customer service tools are impacting the industry. There are several use cases for automation in the industry, as businesses try to reduce expense and speed up service. For example, data collection, processing, or the pre-population of data fields could help reduce time manually completing these tasks. Automation is also spilling into the customer service field. Chatbots, self-service portals or automated email replies are just a selection of ways businesses can begin to automate customer service.

Automation can be costly, and human intervention can never really be beaten. In fact, zero percent of our survey respondents said they’d be happy with an all-automated service. This is because real people can tackle much more complex tasks. And, in some cases, human interaction can be quicker. A text or email that’s answered within minutes by a real person can be much quicker than waiting for a chatbot to ask several questions before triggering the right answer.

There is a difference between automation and digitalisation, however. Automation, as the name suggests, refers to automating tasks where digitalisation is essentially using digital methods as a primary form of communication (i.e. email, social media etc). 45% of consumers would be more likely to choose a vendor if they had digitalised their customer service offering. This is because consumers wanted better availability, speed and proof of contact. For many, digital communication offers a much quicker, smoother process than waiting to speak to a real human being.

The key here is there is, ultimately, a human responding or reacting to digital methods such as email or social media. Automation steps in when real people take the backseat and allow technology to do the talking. While elements of automation will start to help customer service become more effective, it’s likely the improvement of customer service will come from improving the knowledge and skillsets of real people.

Empathy in the insurance industry

The importance of empathy is set to grow in the future. Our research shows business professionals predict empathy / emotional intelligence will become significantly more important in the coming years. Yet just 25% of our survey respondents said they were happy with the current levels of empathy / emotional intelligence demonstrated during a business purchasing transaction.

This shows there is currently a large opportunity for those in the insurance industry to fill this skills gap and demonstrate exceptional empathy towards customers. And your efforts won’t go unrewarded.

The UK Customer Satisfaction Index found customers are more likely to feel positive sentiments towards a business if they’ve received good customer service when going through a particularly difficult or emotional time. Purchasing insurance and making an insurance claim were cited as some of the more complex / emotionally challenging issues customers are set to deal with.

This shows companies within the insurance industry have a fantastic opportunity to excel and deliver a great customer experience – and their business will benefit. Insurers and brokers should invest in training staff to deal with complex queries empathetically and effectively. Customers experiencing personal difficulty will require more time and a tailored service and will be more appreciative towards businesses that get this right.

The opposite is true, too. A customer will feel much stronger negative emotions towards a business that does not look after them when they are experiencing difficulty.

Personal customer service will stand out

In our world of online comparison sites and large broker organisations, it’s easy for customers to become a very small consideration. This should never be the case. Customers should be the focus for brokers. There’s an opportunity for real people to connect and build a personal, tailored relationship. Here at Romero we’re proud to have worked with many of our customers for decades, and can honestly say they’re part of the Romero family.

The stats speak for themselves: to stand out and succeed in the insurance industry, business should invest in improving customer service.

For the full results of our survey, download The Customer Experience Report 2020 now.