New research from customer benefits and loyalty firm Collinson has found that many insurance customers are unhappy with the treatment they receive from their insurers. In particular, customers are not receiving the personalised experience that they increasingly crave and, according to Collinson, this is jeopardising loyalty.
The survey, which took in responses from more than 2,000 UK consumers, found that only 19 per cent (one in five) felt that their insurer valued their loyalty and rewarded it in kind. Thirty-five per cent said that they regularly received offers or loyalty initiatives that were of no interest to them, while 34 per cent said that they often received communications they described as ‘pointless’. Thirty-one per cent said that they frequently received communications that were not personalised in any way, and only 24 per cent said that they believed their insurers saw them as individual people, rather than as numbers.
Interestingly, even though these numbers look far from positive, only 21 per cent of respondents said that they were likely to switch insurers because they don’t feel valued, while only 15 per cent said that lack of personalisation would drive them to switch. However, it is unknown exactly why this is the case.
Further research commissioned by Collinson and undertaken by Forrester Consulting indicates a deeper problem; 25 per cent of decision makers at financial services institutions do not have a deep understanding of what makes their customers loyal. And while 66 per cent say that improving customer loyalty is a priority over the next year, that still leaves 34 per cent that are not prioritising the issue. Even more concerningly, 53 per cent said that they are not collecting enough data to build a clear picture of their customers.
“Consumers are choice-rich and savvy and the balance of power has shifted in their favour. They understand their worth and expect to be rewarded for their loyalty with highly relevant and personalised experiences. It only takes one bad experience to undermine customer trust. By failing to understand what matters to their customers and to treat them as an individual, insurers are effectively sending them into the arms of a competitor,” said Steve Grout, Collinson’s Director of Loyalty. “Given the depth of customer data available and the proliferation of tools to analyse and mine that data, it’s disappointing that so many insurers are taking such a blanket approach to loyalty in 2018. Insurers urgently need to raise the bar on their approach to loyalty – so many are apparently flying blind in an age when customers have more power, choice and higher expectations than ever before.”