The end of the first quarter is a good time for people to re-assess their financial situations and to start shopping around for more competitive insurance premiums. In the UK’s commoditised insurance market, many people switch policies annually making this one of the sectors most blighted by heavy levels of customer churn. One of the key reasons for this lack of loyalty is that brokers typically grasp few occasions for interaction with their customers, often limiting themselves to reaching out only for renewals and to send regulatory updates as well as the occasional attempt to up-sell. But this kind of low-touch approach is dated and ineffective – ever more so in an era when consumers can access a range of quotes and cover options at the click of a mouse or the tap of a mobile app.
The outlook for the sector this year highlights that brokers will need to work hard to keep up their customer income volumes, with home insurance premiums forecast to drop a further 1.7% from 2015 levels. The price of motor premiums for consumers is predicted to rise for the third year running by a further 3% in 2017 equating to an average £46 hike since 2015 -but this will probably drive more customers to defect or at least start looking around for best value.
So how can brokers ensure that they are present at key stages of the customer journey to purchasing or renewing insurance? What are the handful of best practice brokers already doing? First comes an understanding that we live in a multichannel era; long gone are the times when consumers would pick up the phone to call their agent to get a quote. Consumers nowadays are accustomed to shopping around for everything from bank accounts to shoes and price comparison websites are testament to this preference. And yet purchasing decisions are not just based on price, but on trust and rapport too.
A broker that shares useful tips on social media, updates customers regularly over email with regards to regulatory changes is more likely to be front of mind when customers come to reassessing their policies. Even more important is being aware of how customers are getting in contact with the broker- do they prefer email or chat? Telephone or SMS? Understanding how they browse and consume information is vital to helping brokers reach out to customers via the right channel at the appropriate moment; for example, when they have just accessed social media chat to enquire about motor insurance further to a mail out they received the week before.
Being present over Twitter with offers and information on travel insurance, for example, can be very important at the start of summer when people are planning their getaways, but it is also critical that systems are integrated and able to track customer journeys. This way if a consumer telephones the contact centre with a query, live agents are able to see what the customer has experienced so far, such as receiving a twitter message about travel insurance that was followed up with an automated chat bot query regarding countries covered. With this type of information live agent time is used most efficiently driving informed sales or speedy problem resolution thanks to a truly holistic view of the multi-channel customer.
Automated capabilities and live agents each have their valuable role to play. Automation delivers standard information very effectively. But only a well-supported live agent can manage a complex query or offer human powers of persuasion.
Graham Ede is from Yonder Digital Group