Canadian life insurers need to better nurture customer relationships through improved digital communications and distribution strategies, according to new research.
Ernst & Young (EY) discloses this finding in its report, “Consumer Insurance Survey: Reimagining customer relationships.”
“As insurers face challenges in retaining customers, there’s work to be done in developing strong mutually beneficial relationships,” says EY Partner and Canadian Financial Services Insurance Leader Marc-Andre Giguere.
According to the survey, only 6 in 10 (59 percent) of Canadian consumers trust life insurance companies, the lowest trust rating compared to pharmaceutical companies (61 percent), car manufacturers (64 percent) and banks (81 percent), signaling serious customer relationship issues. The numbers are similar for P&C insurance companies, that have only 56 percent trust, versus pharmaceutical companies (59 percent), car manufacturers (68 percent) and banks (73 percent).
The report indicates that insurance products are “typically out of sight and out of mind” because insurers have few interactions with customers, making “each one a critical opportunity for strengthening customer relationships and building trust.” To that end, insurers need to invest more in digital communications initiatives that consumers are receptive to.
“Eighty percent of Canadian P&C and 76 percent of life insurance consumers are willing to use digital and remote channel options for different tasks and transactions,” Giguere says. “To stay relevant and enhance personal interaction, insurers must develop flexible and multichannel contact options like online chat, video tutorials and mobile apps.”
Insurers can also improve their customer relationships by:
taking responsibility for the overall health of all customer relationships
greatly improving their customer intelligence by embracing advanced analytics
acting predictively, precisely an nimbly in advance of key decision points
being “easy to deal with” by offering relevant and timely solutions during critical interactions
“Leading Canadian insurers will start reinventing themselves as customer-focused companies to tackle high customer turnover in the short term,” says Giguere. “Future industry game-changers such as telematics and wearable technology give even greater reason for change, to help insurers serve the customer of the future.”
The infographic on the following page recaps life insurance highlights from the report.