Insurance is a deferred promise of restitution. It is founded on the belief that potential problems will be swiftly resolved and lives can be returned to normal. This belief is central to the brand promise of insurance companies and their consequent commercial success.
However, in a recently published report*, two out of three millennials voiced their belief that insurance firms may fail to pay out in the event of a claim. More worrying still is that this is a view shared by over half of the UK population.
Based on these statistics it would be fair to say that the insurance industry faces a growing crisis of trust. Yet conversely, in the same report, 70% of insurance claimants believe the process of making a claim was either good or very good.
So, what the industry faces is a trust gap - how the UK population perceives the industry and how the industry is actually acting would appear to be at odds.
This is more than just a communications issue. Our research shows that a root and branch exercise to eradicate trust-eroding activities is required if the industry is to avoid reinforcing negative perceptions – and more importantly to restore trust.
Our most recent Customer Experience Excellence report** shows that the insurance industry performs poorly when it comes to customer perceptions of integrity and trust. But the report also shows that insurance firms which actively pursue a trust agenda not only restore perceptions of their integrity but also improve the quality of experience and reduce operating costs. In a phrase - restoring trust pays.
One large UK based mutual insurer is an excellent example of a firm which has attended to the basics first, and in so doing has improved customer trust, customer experiences and commercial returns.
Every process has been examined in detail, customer journeys were mapped, and trust- eroding “moments” identified and removed. In their place, trust-building ‘moments’ were designed into the journeys so that customers were not only given a great experience, but reasons for possible customer doubt were skilfully designed out. Crucially, the focus was on creating a great first impression. Behavioural science shows us that a great first impression is a vital prerequisite when it comes to establishing customer trust.
On finding that their customers had to call them multiple times, they also focused on first time call resolution. Deep insight into what was driving multiple calls led to numerous improvements and a one call only (one and done) principle was applied. The resulting customer journeys are simple, easy to navigate, and build customer trust at each touchpoint. The net result was that this large mutual insurer has moved up 119 places this year on the Top 100 Customer Experience (CX) Company’s index, and they have also substantially reduced the costs attributable to failure demand.
Additionally, one large UK Personal Lines Insurer has moved 138 places this year on the index, although it has taken them a number of years of intense focus for the results to show. New propositions, behavioural training for their people and improved systems have all played their part. All of this has been cemented into their customers’ psyche through high profile advertising which has educated customers on how the promise will be delivered and what they can expect in the event of the need to claim.
Trust is the basis of all relationships – as the saying goes “trust is earnt in drops and lost in buckets”. If the trust perception deficit is to be reduced then the insurance industry in general needs to attend to the issues and problems that reinforce the stereotype. The results will be improved experiences for the customer and significantly improved profitability for firms.
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Sources:
* Insurance Times September 2017, research conducted by Claims Rated.
** Igniting Growth – Connecting Insight to Action, KPMG Nunwood, Customer Experience Excellence Centre 2018