Earlier this year Insurance Business UK stated that “consumers’ preference for using the internet to research and purchase insurance means that brokers need to make digital tools a key part of their arsenal”.
Yet whilst the internet provides increased choices for the consumer, loyalty has been directly impacted as a result. Recent research by McKinsey found that 58% of consumers now change brands from one purchase to the next.
So how should insurance brokers and insurers react in the face of these challenges?
At Threekey, we believe that there are several opportunities that insurers and brokers can take and we’ve listed two actions you can take.
These may be outside the comfort zone for some companies but we believe that they are worth considering.
Action 1. Increase customer loyalty with more touchpoints
Research of insurance businesses by Bain found that “more interactions, provided they are high-quality interactions, lead to more loyalty” – in other words, increased touchpoints and useful communications help to reduce the erosion of customer loyalty.
Customers see insurance as a commodity purchase – they don’t tend to think about it unless they need to claim or renew.
Many insurers rely on annual policy renewal reminders to make contact with customers, but this can be a risky approach.
Bain’s research shows a more effective path is regular, proactively targeted customer communications through social media, editorial content and video.
Action 2. Actively target new market opportunities via digital communications
Whilst competition in the insurance sector is increasing online, research by the Financial Conduct Authority (FCA) has found that SME’s could be underinsured.
This presents a significant growth opportunity – and social media and content marketing are a critical method of reaching this audience.
Sector-specific, SME-focused editorial guides, video explainers, news bulletins and whitepapers via social media enable you to put yourself directly in front of prospects, by tackling the issues they’re genuinely interested in.
Key takeaway
Your customers and prospects think about their business and only consider yours for a few days every year. There is an opportunity for you to proactively speak to your existing and potential customers about what interests them – in their language.
If you think that the above points might be worth considering, but you don’t have the time, Threekey could help you.
After all, if you don’t do it, somebody else will.
