[Skip to content]

Sign up for our daily newsletter
The Actuary The magazine of the Institute & Faculty of Actuaries
.

Customer satisfaction with UK insurance industry declines

Customer satisfaction with insurance companies in the UK is lower now than at the beginning of last year, with the industry continuing to fall short in the way it handles complaints.

06 MARCH 2018 | CHRIS SEEKINGS
Falling customer satisfaction ©iStock
Falling customer satisfaction ©iStock

That is according to a new index from The Institute of Customer service (ICS), which scores the insurance sector 78.7 out of 100 for overall customer satisfaction – 0.7 points lower than in January 2017.

This is still 0.6 points higher than the all-sector score of 78.1, but with in-person experiences remaining below average, firms are being urged to ensure their customer service strategies are consistent across all channels.

“Although still above the national average, customer satisfaction within the insurance industry has declined,” ICS CEO, Jo Causon, said. “This paints a clear picture for the sector.

“In order to benefit from long-term returns, organisations must continue to invest in customer service and place it at the heart of their business strategy.”

The index ranks Nationwide Insurance as the highest-performing insurer for customer service, with Saga, LV= and Aviva also rated highly, while 17 firms score below the sector average.

The institute’s research also found that 60.4% of insurance customers are not prepared to compromise service in pursuit of the cheapest deal, and that 27.2% are willing to pay a premium for better service.

In addition, analysis of data from the Office for National Statistics by the ICS finds that businesses could be missing a significant opportunity, with improvements in customer service potentially worth £81.5bn to UK GDP.

“It is clear that where satisfaction is maintained, organisations will see a direct link to turnover growth, profitability and productivity,” Causon added.

This comes after a survey of 1,025 UK adults by Engine Service Design in June last year found that the insurance industry was considered the fourth worst sector for customer service.

In contrast, the banking sector had improved in this area, and done more than any other to enhance service over the last three years, according to Engine co-founder, Joe Heapy.

“Obviously insurers don’t have the day-to-day interaction that banks have, so they need to find ways to make themselves more relevant to customers more often,” he said.

“But people aren't asking the earth. The three things they value most when dealing with a company are honesty, efficiency and reliability.”


Sign up to our free newsletter here and receive a weekly roundup of news concerning the actuarial profession