2024 Global Benchmark Report: Enhancing Insurance Customer Experience with Technology Investments
By Eileen Potter, VP of Insurance Marketing at Smart Communications
In today’s fast-paced digital environment, insurance customers are expecting more streamlined and user-centric interactions. With a significant shift towards mobile and web-based engagement, insurers need to adapt by investing in cutting-edge technology that aligns with customer expectations. This means integrating agile, cloud-based systems that enable seamless and secure communications while addressing diverse regional and generational preferences.
Our latest Benchmark Report, conducted by an independent research firm, dives deep into what today’s policyholders value most. The report reveals critical insights into customer satisfaction, loyalty, and technological priorities for 2024. In this article, we’ve laid out the critical data points for insurers like you and included the next steps to mitigate customer retention issues and reputational risk.
Key Finding 1: Communication and Data Collection Practices Shape Insurance Customer Experience
In an era where digital interactions are the norm, the quality and efficiency of communication are paramount. Policyholders and prospects expect insurers to deliver interactions that are as effortless and personalized as those from leading tech giants. Despite the rising importance of effective communication—where 85% of customers rate it as vital to the customer experience—only 41% feel the current standard meets their expectations. This discrepancy highlights an urgent need for improvement.
Top Priorities for Effective Communication
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Clarity and Accuracy: Ensuring communications are clear and accurate remains the top priority for 71% of insurance customers.
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Timeliness: Quick responses are also crucial, particularly in a competitive market where prompt service can significantly influence customer satisfaction.
Actionable Insight: Invest in a sophisticated Customer Communications Management (CCM) platform integrated with digital forms automation. This will streamline your communications and enhance personalization, addressing the growing demand for high-quality, tailored interactions.
Key Finding 2: Loyalty is Linked to Communication Quality and Data Handling
Customer retention is more cost-effective than acquisition, making it essential to build and maintain loyalty through exceptional service. Our findings show a strong connection between the quality of communication and customer loyalty, with a notable increase in the likelihood of switching providers due to poor communication—up 15% from the previous year.
Policyholder Retention Strategies
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Focus on Quality: Prioritize clear, personalized, and accurate communications.
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Enhance Data Collection: Simplify and automate data collection processes to reduce friction and improve overall customer satisfaction.
Actionable Insight: By integrating modern CCM solutions and automating data collection, insurers can enhance both customer retention and acquisition, leveraging improved communication and streamlined processes. 
Key Finding 3: Data Security and Trust Are More Crucial Than Ever
Insurance companies hold sensitive customer data, making trust a foundational element of the relationship. While 61% of policyholders trust their insurance company, there is an increasing concern about data security. With 94% prioritizing security in digital interactions, maintaining rigorous security standards is non-negotiable.
Three Areas for Improvement
- Enhance Security Measures: Adopt robust, enterprise-grade security protocols for all communications and data handling processes.
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Maintain Transparency: Clearly communicate how customer data is protected and how security measures are implemented.
Actionable Insight: Invest in CCM solutions that offer advanced security features and compliance with industry standards. This will not only safeguard customer data but also strengthen trust and loyalty.
Key Finding 4: Mobile and Web Channels Are Dominating Customer Preferences
The shift towards mobile and web-based interactions is undeniable, with 39% of customers preferring these channels for managing their insurance needs. This trend is especially pronounced among younger generations, highlighting the need for insurers to adapt to changing preferences.
Preferred Communication Channels by Generation
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Millennials and Gen Z: Strong preference for mobile/web interactions.
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Baby Boomers and Silent Generation: Higher inclination towards traditional channels like call centers.
Actionable Insight: Develop an omnichannel strategy that supports both digital and traditional channels, ensuring a seamless experience across all customer touchpoints.
Key Finding 5: Transparency and Ethical Use of GenAI Are Essential
Generative AI (GenAI) offers promising advancements in insurance communications, but its integration must be handled with care. Our research found consumers are concerned about the ethical use and security of GenAI, with 77% emphasizing the need for transparency about its use.
Best Practices for AI Integration
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Ensure Transparency: Clearly disclose when GenAI is being used in customer communications.
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Maintain Human Oversight: Implement human review processes to ensure accuracy and safeguard sensitive data.
Actionable Insight: Use GenAI to enhance communication quality and efficiency while maintaining transparency and oversight to address customer concerns and build trust. Partner with a provider that prioritizes protecting crucial interactions and offers expert guidance on the responsible, high-impact use of GenAI.
Next Steps for Insurers
To meet evolving customer expectations, focus on enhancing communication quality, ensuring data security, and embracing digital innovation. Prioritize investments in CCM and intelligent data collection solutions to improve customer interactions, streamline processes, and build lasting loyalty.
Smart Communications offers industry-leading solutions to help insurers deliver personalized, secure, and compliant communications. SmartCOMM™ and SmartIQ™, are designed to integrate seamlessly with core systems, providing the technology needed to meet today’s customer expectations and drive success.