As insurance companies move along the path toward digital transformation, a key question emerges: How much digitization and automation do you need to meet consumer expectations?
There is no effective one-size-fits-all plan for digital transformation. The amount an insurer should digitally transform is largely predicated on their customer base and business model, which may vary by company.
Here are three ways you can optimize your digital strategy to bolster customer satisfaction and retention.
1. Align Your Digital Strategy with Your Business Model
It stands to reason that different companies require different roadmaps to digital transformation.
In the case of monoline insurers, like a Geico, there is an imperative to attract new customers. This focus at the top of the funnel may look like a digital transformation that prioritizes the quoting or purchasing processes.
A monoline insurer will generally commit any digital transformation efforts towards attracting new clientele. The thought process behind this business model is that it is more profitable to attract new clientele than it is to focus resources on retaining existing clientele.
In stark contrast, agent-driven insurers, like Allstate, focus on retaining existing customers. This results in a greater emphasis towards the bottom of the funnel.
A focus on the bottom of the funnel means that an insurer like Allstate will likely concentrate its efforts on creating a machine-supported human experience. For example, if an agent-driven insurer is undergoing a digital transformation, there will likely be a de-siloing of customer data to verify that at every touchpoint, the customer feels known and heard.
By improving access to customer data internally, insurers can ensure the customer doesn’t need to reiterate the same story on why they’re filing a claim to every representative they speak with. Instead, the information that was communicated on the first call with an agent, is uploaded to a database for visibility across the organization. This is how better digital infrastructure supports your customer experience and ultimately the goal of improving customer retention numbers.
2. Know Your Customer Segments and Deliver the Customer Experience They Want
Not every customer wants to interact with their insurer exclusively online or via app. Not every customer wants to correspond over mail or face-to-face. Understanding your customer segments will inform your digital strategy as you focus on exceeding customer expectations.
For example, a legacy insurer with less digitally savvy customers may not benefit from a full-scale digital transformation. But younger customers want digital convenience.
In fact, 62 percent of Millennials perform a majority of transactions online or via mobile app and nearly 40 percent of individuals under 50 cited “a better mobile app” as a reason they’d leave their insurance provider.
As a result, there is an industry-wide imperative for all insurance providers to modernize their customer experience across segments.
3. Keep Your Customer Experience at the Center of Your Digital Transformation Strategy
Customer satisfaction is a guiding light for insurance companies as they attempt to thread the needle between tradition and innovation. Using customer satisfaction as a key metric to guide implementation often can provide insurers with the right balance of digital transformation.
Let’s say your core customer base prefers in-person consultations. A tailored approach to digital transformation may look like creating an app experience that serves the digital-first demographic without focusing too many resources on this segment. This balances the need to modernize the customer experience without alienating your core customer base that prefers in-person consultations.
With monoline insurance companies, having a digital capture point at the top of the funnel is more important than having it towards the bottom. With agent-driven insurers, the opposite would be experienced. This is due to the fact that the digital capture point for agent-driven insurers is at the bottom of the funnel.
Delivering a satisfying customer experience is a matter of knowing how your segments and business model enable you to cater your digital strategy to your customer base.
The Power of Consistent, Reliable Customer Support
Customers are not looking for reasons to contact their insurance providers 24/7. But, when an accident arises, the claims process sheds light on the potential differences between a customer’s experience at the top of the funnel and their experience at the bottom.
These two experiences – onboarding and filing a claim – should not be vastly different. Your customers should feel as valued at the top of your funnel as they do at the bottom.
The value of consistent customer experience throughout the funnel cannot be understated. When a customer seeks coverage, they are entrusting insurance companies to protect their home, their car, and their loved ones. You risk betraying this trust when you silo information or fail to understand the impact of knowing your customer segments.
Insurers can meet and exceed customer expectations by integrating a digital transformation that aligns with their unique business model and customer segments. In short, knowing your customer enables you to satisfy your customer.
To find out how our team of experts can help you move closer to knowing your customers, contact us today.