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Author: Pradeep Jagannathan |03/15/18

4 must-know components for a life insurer’s customer engagement strategy


What is customer engagement? The Internet is flooded with a number of definitions and metrics that can be used to measure customer engagement. Engagement, in its true sense, is a measure of feelings that the customer has towards a business which can gradually transform into loyalty. Businesses across the globe may have different goals, but they all have a unique goal of pleasing their customers. In this digital era, technology plays a major role in altering the ‘feelings’ customers have towards the brand. Interestingly, technology can be a boon or bane for a brand in its approach towards engaging customers.

In the life insurance business, the customer is the center point around whom the entire business revolves. In such a customer-centric business, customer engagement solutions should be the prime focus of the life insurer. When a customer loves the brand, they will not only be loyal but also act as a brand ambassador through word of mouth. Hence, a life insurer must consider the following 4 components while drafting their customer engagement strategy.

Trust is First:

The long-term perception that life insurance is ‘sold’ and not ‘bought’ is changing gradually. With the massive growth in technology, customers are empowered with collecting information from multiple sources and taking an informed decision. In such a scenario, the insurer must build trust before trying to sell the product. The very first step in building trust is to engage with them. There are three areas where an insurer can build trust among the customers.

  1. Website: When a customer is in need of any service from the insurer, his first point of contact is the insurer's website which must be well equipped with all possible information about the company and products.
  2. Personalized approach: Insurer should build an engagement model tailored for each individual with the help of advanced analytics and exponential data. A more tailored and personalized approach to a lead results in high lead conversion ratio.
  3. Reputation Management: Insurers must also have a reputation management team with a 360-degree view of existing customers. For example, a simple Facebook post about a bad experience with the company can go viral and will incur heavy damage to the company’s reputation. In such a scenario, the reputation management team must actively respond back to the post expressing their regret with guidance on ways in which the issue can be handled. This will not only help in building trust among the existing customers but will also be a brand promotion to the public.

Hassle free beginning:

Once trust is built, a customer will get in touch with the insurer through one of its channels to enquire or buy a policy. With online channels getting increasingly popular, it is necessary for the online portals to be informative. They should be designed in a way such that it fulfills the customer needs and provides them with choices for building their own products. Additionally, the customer should not feel like they are left in a no man’s land and the portal should provide them with all possible support, including insights, at any point in time. With the help of advanced analytics, the portal should be enabled with product insights, customer behavior (peer comparison), etc. The insurer must try to engage with the customer as much as possible during the initial days. Requesting a feedback post policy issuance about their journey will not only help to improve the existing process but will also help to improve the customer's positive opinion for the brand.

Human touch:

While customers prefer human interaction, insurers are in a demanding need to increase their profit by improving operational efficiency. When we look at the other industries (including some from the insurance sector), pioneers in servicing customers are those who exhibit their excellence by leveraging their digital capabilities with traditional channels. Customers are not only expecting a human touch but are also looking for 24 X 7 X 365 availability. To provide an anywhere, anytime access with a human touch and without impacting the operational efficiency might seem like a difficult goal, it can be overcome with the help of ‘Chatbots’. It is a computer program powered by artificial intelligence designed to simulate a conversation with human users over the Internet with deep learning technique built upon the principles of Natural Language Processing, Machine Learning, and Pattern Recognition. Some of the business scenarios that can be handled through chatbots are quote generation, policy servicing (premium frequency change, payment mode change, etc.), claim notification, locating an agent, information on products, etc. Chatbot interaction provides a whole new experience for the customer and this will help in improving the customer's experience with the insurer.

Reward me more:

Post policy issuance, the communication from insurer to customer decreases, restricted only to the intimation of renewal payments and this gradually fades out the positive opinion that a customer initially had. Millennial customers want their service providers to make them feel more empowered and to reward them for their loyalty towards the brand. One of the important trends that an insurer should look into in this arena is the usage of wearables. Many life and health insurers across the globe have started incorporating wearable usage into their customer engagement strategies. A wearable is an IoT device worn by a customer that acts as an activity tracker and collects his/her physical activity data and shares it via the Internet. Based on the physical activity of the customer, an insurer rewards the individual in different ways such as an increase in cash value, cash vouchers, partner membership cards, etc. This not only engages the customer but also helps in improving their health, thereby reducing the claim cost for the insurer.

With the exponential growth in technology, it is a must for insurers to keep up with the pace. As millennial customers are interested in using a more sophisticated device with advanced technologies, insurers have a pressing need to provide a similar experience on their channels as well. In all the above 4 components, we can see a flavor of technology through which the respective components are further enhanced. Thus, technology is the fulcrum to leverage all of the above four components with respect to the insurer's customer engagement strategy.

An insurer who gives equal weight to all the above components, balancing it with the correct fit of cutting-edge technologies while drafting their customer engagement strategy, will reap the benefit of customer loyalty and thereby generate more revenue.

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