If Covid-19 has shown us anything, it underlined the fact that the future of life insurance belongs to the insurers who go out of their way to make their customers’ lives simpler and easier by delivering exceptional customer experiences.
“Customers remember both great and bad experiences: when insurers build a great experience, they deepen support from advisers and customers alike. But if insurers make people jump through hoops to just do business with them, they’ll lose them forever – and probably lose others by word of mouth,” Gareth Quinn, Chief Technology Officer at FMI emphasises. No doubt, those insurers who hobble advisers by erecting barriers to good service may very well find themselves losing clients, rather than retaining them.
FMI has identified the five top customer experience trends they’re seeing in the South African life insurance industry – trends that will further gather momentum in 2021.
Highly personalised customer experiences
More than ever, consumers expect life insurers to present their offerings in the most elegant, understandable way possible, that’s tailored to their specific needs. Life insurance is complex, and people run from ambiguity or complexity.
Faster digitisation of advice, application and servicing processes
What Covid-19 also showed was that when forced to, even the most old-school advisers will adopt newer, more streamlined processes. This paves the way for insurers to be more aggressive in making big process changes that require buy-in from their distribution channels.
More automated, algorithm-based financial planning
Customers want to feel confident in the product they’re paying for every month, so insurers need to work at showcasing their value and figuring out ways to stick with clients through affordability cycles and changing life circumstances. They also need to demonstrate that their projections are based on real-time data that talks to their specific needs and pain points.
Life insurers will partner more with insurtechs to deliver innovation faster
To bring innovative tech-enabled solutions to market quickly, insurers will need to consider how to innovate through partnerships if they’re going to stay relevant and competitive.
Micro-insurance targeting specific events, delivered digitally
The major issues that customers have to navigate in the life insurance space are largely centred around product and process simplification. One way forward could be micro-insurance, where people insure specific events, like hospitalisation or illness, for smaller premiums.
“The pandemic has shown us how quickly life insurers can adapt when they are pushed to. With the lessons of 2020 fresh in their minds, I’m confident that 2021 will see more life insurers looking for ways to reduce friction and remove admin from the customer experience – and the entire industry will be better for it,” Quinn concludes.
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