The claims process is a key part of the relational and customer experience of Property & Casualty insurance company customers. Yet, at the same time excellent service, follow-up and customer satisfaction regarding the claims process are not enough.
What really does matter more: end-to-end customer experience management and digital accessibility to information for an empowered consumer whereby information management excellence matters more than ever.
According to research by Accenture a whopping 41% of surveyed P&C insurance customers who said they were satisfied with the way their claim was handled, still reported they are likely to switch to another insurer.
There are several things to point out here. First of all, customers who are not satisfied with the way their P&C insurance claims are handled are “almost certain to defect”, Accenture’s Michael Costonis states in the announcement of the research results. Looking at the figures from the survey whereby 8,000 auto and home insurance customers were polled, this means there still is ample reason to focus on customer satisfaction in the claims process.
Let’s do the math: 83% of the respondents who reported a dissatisfaction with the way their claim was handled, said they had switched or planned to switch to another insurer. In the case of those who were satisfied, as mentioned this is 41%. The opportunities to increase satisfaction within this single customer experience touchpoint are clear.
Speed of settlement and process transparency are the most important contributors to customer loyalty, with each cited by 94 percent of survey participants as a key expectation when interacting with insurers during the claims process (Accenture).
Beyond the single customer experience: an end-to-end view
But there’s more. While the claims process is widely recognized as a key moment in the customer experience, Accenture also found that customers who have submitted an insurance claim in the past two years are almost twice as likely to switch insurers than those who didn’t submit a claim. Quoting Michael Costonis, “the very act of filing a claim makes a customer much more likely to switch insurers, regardless of how satisfied they are with the experience”.
And this is where I would like to point out something else. People want to protect what’s dear to them and it’s important to recognize the full impact of that. It’s also important to look at how to make the difference from a customer perspective and, while doing so, taking the overall customer life cycle into account. As also mentioned in that post, customer satisfaction, service, assistance and smooth claim processes alone don’t cut it but they do remain important.
Protecting what is dear to us is about managing risks. This means that we would prefer to avoid claims as much as possible, as Michael Costonis confirms. It is so important that, according to the research, consumers are willing to share data and provide information using innovative and differentiating possibilities, often based on digital technologies.
Customers are willing to share information, and insurers that are able to use this information to help customers manage risks and reduce the number of claims will not only lower claims costs but may gain an advantage in terms of customer loyalty (Thomas Meyer, Accenture)
The claims process is an important moment in the customer experience but it’s not the only one. In that sense, regardless of the exact percentages, the findings of Accenture are not that surprising.
Customer satisfaction, customer retention and customer experience are not limited to single touchpoints or interactions. It’s a key given in the practice of customer experience management. The research is probably one of the best examples showing how important it is to have an end-to-end customer experience view, making the difference on all levels of service and services. This also encompasses the brand experience, differentiating risk management propositions and, last but not least, the possibility of multi-channel interactions.
61% of insurance customers participating in the survey said “they would prefer to use digital channels to check the status of their claims”. A whopping 53% said they would not recommend their insurers to others of they can’t interact digitally with them.
By 2018, insurers anticipate nearly one-fifth of their business to be generated through internet, up from 12.7% in 2013. Another 10.9% is expected to come via mobile channels, up from a mere 1.5% in 2013. In effect, within five years, nearly one-third of the insurance industry’s business is expected to occur digitally (World Insurance Report, 2014, Capgemini).
The essential role of digital in customer service and insurance claims processing
The increasing role of digital and social channels, showing in the research, affects the insurance customer service and/or contact center design, further strengthening the need to offer omni-channel interactions in a unified way, as part of the overall loyalty, service, experience and even word-of-mouth equation.
Approximately 29 percent of respondents say they post or plan to post on social media channels about their positive claims experience, and a similar number (30 percent) say they post or plan to post about their negative claims experience. In addition, 43 percent of respondents said they either read or plan to read reviews that other people post about their claims experience. (Accenture)
The growing attention for digital and mobile is not only about customer interactions and offerings. It’s really about changing customer expectations (as Accenture’s research also indicates) and about changes in the customer behavior. According to the World Insurance Report 2014 from Capgemini and Efma, insurers anticipate that by 2018 19.7% of their business will be generated through internet and 10.9% via mobile channels. This has even led insurers to focus on the design of positive customer experiences in mobile as the 2013 graphic by Capgemini below indicates.
Also, according to the World Insurance Report, 2014, by 2018 “nearly one-third of the insurance industry’s business is expected to occur digitally.”
When it boils down to the insurance claims process itself, speed of settlement and process transparency are the key contributors to customer loyalty.
Optimizing the customer experience in all interactions with the brand, service channels, risk management offerings and overall customer life cycle, are important with the satisfaction regarding the claims process as one element that is hard to overlook.
At the same time, the adoption of digital technologies in both the interaction processes and the future offerings themselves, play an increasing role. The possibility to submit and follow up claims in more ways than before is essential in it all, as are smarter and faster insurance claims processing and the future of claim services on more digital devices.