Major Problem of Insurance Sector: Customer Disloyalty!13July

Major Problem of Insurance Sector: Customer Disloyalty!

Insurance sector is a limited connectivity business, where most of the time there is an intermediary like agent or broker, therefore an indirect communication between the company and the customer. Major touch points are policy issue, policy renewal and claim processes. To be more precise, if an insured does not have a claim during the life of the policy, by the time of the renewal he is about to forget the name of the company.

 

Since the number of touch points are limited, each touch moment is priceless. It is obvious that the companies that do not keep customer satisfaction levels high at these moments or revise their business processes to be more customer-oriented, are to be outdated and lose market share. Research shows that customers with at least one touch moment are 28% more loyal than customers with no touch moments.

 

With the foreign investment boost in the last ten years, insurance sector is growing rapidly but consumer confidence index show other way around. According to a research in 2014, consumer confidence index of insurance sector is below supermarkets, banks, automobile brands and even e-commerce web pages. Companies with low consumer confidence index can not reach desired levels of customer loyalty and furthermore lose valuable customers to the rivals.

 

According to a study in Europe, 36% of customers in non-life branches think about changing their company within the next 12 months. Major reasons for company change seem to be not being able keep up with changing needs (40%), low quality service (32%) and agency guidance (24%). 77% of customers think that a fast and high quality service during the claim process has a major impact on their decision to change companies.

 

Innova’s award winning, state-of-the-art solution Payflex Loyalty contains all major tools that insurance companies may need for customer loyalty. Companies can user different loyalty schemes thanks to the flexible structure of Payflex Loyalty. For example, customer with auto insurance can be given a discount (according to their segment) on home insurance or customers with policies on more than one sector can be given loyalty points to be spent at future policies or partner companies with agreement. Sky is the limit when it comes to loyalty campaign definitions in insurance sector. Payflex platform is a preferred tool by major banks, telecom operators, retail and insurance companies with different modules to meet the demands of different sectors.