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Thought leadership

Three million new UK consumers[1] are being driven to the insurance market by pandemic pessimism, but Quadient is warning insurers that if they’re unable to speak to customers in their own language, they’ll squander the opportunity. In the wake of COVID-19 disruption, even the most complacent consumers are taking out insurance policies for holidays or large purchases, many having never done so before. If insurers can’t provide them with a simple, quick, jargon-free digital-first customer experience, these first-timers will simply head elsewhere.

“The insurance battleground will intensify in the coming months, as providers look to bounce back from the financial damage caused by COVID-19 and capture their share of new market growth,” warns Andi Dominguez, Principal – Global Insurance and customer experience expert at Quadient. “Customer experience will become the real differentiator at this time. Insurers must prepare for consumers who are not as well-versed in what policy they need, or how the process of taking out insurance works. By identifying areas that may be daunting to novice consumers, they can take steps to make them more accessible. Terms and conditions, policy and claims information should be provided in a simple, clear and concise way, and through the customer’s preferred communication channel. Speed will also be of the essence, as these consumers will likely ask several providers for a quote. If the right information isn’t delivered quickly and in the right way, some will just go with the first provider to respond with a clear quote.”

Insurers can improve their customer communications by harnessing the right technology. A ‘millennial mindset’ has now become the norm, with consumers increasingly confident to use digital challenger brands, rather than playing it safe with traditional market leaders. If insurers do not give customers the slick digital experience they’re looking for, they will lose market share to newer insurance providers, and tech giants. At the same time, they must be on their guard against getting caught up in the latest digital gimmicks. Insurers need to assess which technologies will enable them to provide useful information and help guide people through application and claims processes. For example, video could be used as a form of claims evidence and submitted online, or customer data could be benchmarked so certain insurance products are offered to customers at specific stages in their lives.

“The insurance industry has been hit hard by the pandemic, with losses estimated at $107bn this year, but the mood is far from doom and gloom. While the opportunity of new customers entering the insurance marketplace may seem like a blessing to providers, it would be foolish to assume it’ll be a walk in the park to win them over,” Dominguez continues. “Insurers must provide a stellar experience if they are to fend off competitors, stand out on comparison sites and survive in what is undoubtedly a difficult time for the entire industry.”

[1] Research shows the number of UK consumers looking to buy insurance in the next six to nine months has risen to 44%, compared to 34% pre-COVID. 34% of UK’s 27.8 million households is 9.45 million and 44% is 12.32 million, amounting to 3 million new potential customers

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