Two-thirds of customers are dissatisfied with their life insurers and nearly half would be inclined to bolt to a competitor if they could get a better deal, a consulting firm says.
Accenture Ltd., Hamilton, Bermuda, has published data supporting that conclusion in a summary of results from a survey of about 5,600 consumers in 14 different countries and 10 industry sectors that was conducted between April and May. About 2,500 of the participants were asked to evaluate their life insurance providers.
Just 34% of carrier customers said they are satisfied with the service they are getting, and only one-fourth said they will recommend their current life insurance provider to others, Accenture says.
The percentage of insurer customers who said they will recommend their life insurers to others was the second lowest among the 10 industries included in the survey.
The gas and electricity utility industry is the only industry with a lower “will recommend” score. Only 20% of survey participants said they will recommend their gas and electricity providers to others, while 34% of survey participants said they will recommend their wireless phone service providers.
Despite low satisfaction levels with life insurers, survey participants were less likely to switch life insurers than to change most other types of providers.
But the low switch rates appear to be due to many consumers’ perception that they are “locked in,” with 29% of life insurance customers telling Accenture they are discouraged by the inconvenience of switching providers.
Only 12% of the life customers said they are thinking about buying more products and services from life providers, and 10% said they are thinking about buying fewer products and services from life providers.
When asked to rate what they like about their current life insurance providers, 32% of the respondents selected “trustworthiness,” and 28% selected a “skilled workforce aware of their needs.”
“What we’re witnessing today is a shift among carriers from a product-push strategy to a more segmented life-event or life stage-driven demand that will require more educated interactions with buyers,” says David Shatto, managing director of Accenture’s U.S. life practice. “There are implications for a more targeted selling, marketing and product-delivery in term of how producer performance is tracked and measured; and in terms of how producers interact with buyers.”