How to Optimize Customer Retention in the Insurance Industry
Improving customer retention can prevent billions of dollars of lost revenue in the insurance industry. Research from CallMiner revealed that avoidable churn costs businesses $136 billion in the U.S. alone.
What’s worse than losing billions in revenue is the amount that insurers have to pay to acquire new customers. According to Hubspot, the insurance industry is tied for the third-highest customer acquisition cost at $303.
Reducing customer churn requires insurance companies to think outside the box. Specifically, they can make two major changes to the way they present, offer, and market products and services.
Offer more than insuranceCultivate an online reputation
Reduce Customer Retention by Offering More than Insurance
A 2018 report from Bain & Company revealed that customers look for value quality and ease of use from their insurer.
In other words, to truly stand out from the competition and retain customers, insurers must look to offer more value and a simpler customer experience. There are three main ways of doing so:
Provide a personalized experienceCreate a product “ecosystem”Expand your digital efforts
Provide A Personalized Experience
Insurers can create products and services that are tailored to the needs and lifestyle of each customer.
A 2017 Accenture survey showed that 44 percent of health insurance customers believe it to be important that their providers not just offer insurance packages but health advice as well.
The survey findings also allowed Accenture to put the respondents into specific groups such as the “Nomads,” which are “digitally active insurance customers” and made up 40 percent of the overall group. In terms of auto insurance, Nomads stated their interest in receiving customized adjustments to their insurance package depending on their car usage.
Creating these personalized packages for each customer pays off in the long run. It shows customers that you view them not as just another entry in the database but as a major investor in their well-being. Personalization is also one of the early building blocks of trust and value between the provider and consumer.
Create A Product “Ecosystem”
Personalized insurance packages also means that insurers have the means to provide additional products that are in tandem with existing packages. The Bain report cited above also
By: Rexly Penaflorida II
Title: How to Optimize Customer Retention in the Insurance Industry
Sourced From: www.reviewtrackers.com/blog/customer-retention-insurance-industry/
Published Date: Wed, 31 Mar 2021 15:30:05 +0000