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The Actuary The magazine of the Institute & Faculty of Actuaries

Customers reveal willingness to communicate more with insurers

UK insurers are overlooking an opportunity to build brand retention and loyalty by not connecting more with their customers, a new survey has uncovered.

Opportunity for insurers to communicate more ©iStock
Opportunity for insurers to communicate more ©iStock

The findings show that 63% of customers are open to further communication with their insurers, and that 73% are willing to receive targeted product recommendations.

However, only 46% reported hearing from their insurance provider on a frequent basis, with just 61% receiving relevant recommendations.

Respondents said their exchanges were mostly limited to transactional matters like renewal notices, policy updates, and terms and conditions amendments, leading to disengagement.

The researchers, from loyalty and benefits expertise firm Collinson, said that insurers must find ways to differentiate their offerings to drive customer retention.

“Insurance providers need to demonstrate the value of more regular and personalise communication in order to gain their customers’ trust,” said Collinson head of insurance, Lawrence Watts.

"There is a clear desire from consumers for better tailored experiences, but insurers need to help their customers feel comfortable handing over the data that is needed to create them."

Insurance has traditionally been a low-contact industry, and Collinson said that the situation has worsened following the implementation of General Data Protection Regulation (GDPR).

Of the customers who chose to restrict their data offering to insurers post-GDPR, 35% said they did so without knowing they were missing out on product and services updates.

More than half of the survey respondents said they would not have opted out if they knew they would stop receiving these updates.

However, it was found that consumers expect the content they receive to be personalised based on their individual needs, and transparency about how their data is used.

Almost seven in 10 respondents said they would be encouraged to give their insurers permission to contact them in return for a discount on cover at purchase or renewal.

"Those who succeed will be able to develop a relationship with their customers beyond that of a service provider, to that of a trusted partner," Watts added.

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