Embracing a digital future for insurance
Insurance is a sector that has seen dramatic change over the past five years. The rise of the internet and price comparison sites has transformed the landscape. Insurers are now having to live with diminishing margins and customers that shop around as a matter of course when their policies come to an end. Add to this that many insurers are struggling with inefficient technology and processes and you can see the scale of the challenge facing the sector.
Essentially insurance is being forced to move from the analogue to digital world – at full speed. Instead of communication through letter and telephone, customers want to use faster, more flexible channels such as email, the web and social media. And with ever greater competition consumers will simply move elsewhere if they don’t get what they want, when they want it.
So what can insurers do to win and retain customers, and ultimately guarantee their own survival? A major report from Accenture has some key insight for the sector. Entitled UK Motor Insurance: At the Crossroads? it combines consumer research with advice for beleaguered insurers.
Accenture’s analysis of consumer behaviour delivers some worrying statistics:
- 38% of consumers switched provider at last renewal (compared to under 20% in 2007)
- 68% of consumers have been with their current insurance provider for less than three years
- 82% of those that switched did so because of price
- 40% of switchers listed ‘the ability to manage my policy in a way that suits me’ as a further reason for moving
- 19% of consumers that had complained about their motor insurer did it through social media
- 80% of customers researched online before they bought
- 74% of customer complaints revolved around human interaction – i.e. they were unhappy at the service given by insurance company staff
These findings back up Eptica’s experience in working with insurers across Europe. The good news is that we’re seeing many companies, including our customers, changing fast to become efficient, multichannel businesses. A perfect example is Ageas Insurance Services (AIS) UK. Through its eStream project, powered by Eptica, it has transformed its operations.
AIS chose Eptica’s multichannel customer service suite to drive eStream because it provided an integrated solution for the management of online customer service including email management and the processing of letters and fax. Eptica’s software uses business rules and meaning based processing to ensure every enquiry is routed to the relevant department or managed by the right automatic process. It also analyses each customer request and provides agents with the right response or transaction template to ensure greater accuracy, consistency and faster processing.
The results have been dramatic. Efficiency has increased, with customer handling time reduced by 50% and calls to the contact centre down by 23%. Satisfaction is up as First Contact Resolution rates are now 96% - over 20% above the industry average. Finally, eStream is directly impacting AIS’s bottom line – by collecting monthly outstanding payments through the system recovery rates have increased by 11%. Find out more about AIS’s award winning customer service by downloading a full case study here.
The carnage amongst High Street retailers demonstrates what can happen to industries that fail to change – now is the time for insurers to embrace the new digital world if they want to survive and thrive.