Word of mouth is still the most effective way to retain or gain market share, argues James Grant and, with the rise of social media, more emphasis should be placed on keeping current customers happy.
Few events in life rival the emotional upheaval caused by a property loss. It is a time marked by anxiety and uncertainty. It is also a time when policyholders crave the peace of mind that only their insurance company can provide.
When an insurer meets and exceeds expectations, the effects can be far reaching. The most basic effect is that the customer stays a customer; a wide range of studies show that it costs approximately five times more to acquire a new customer than retain an existing one. Existing customers are also the best potential buyers of your new products and services.
Marketing professionals agree that word of mouth from satisfied customers is still the most effective way to acquire new ones. The recent explosion of social media has magnified that effect and placed increased emphasis on the importance of the loyal customer.
A pleased customer once had influence on the decisions of a few relatives, associates and friends. Social media can significantly widen that reach. Modern consumers are far more likely to take the advice of friends — even online ones — than they are to respond to an advertisement.
Consequently, many companies are placing renewed emphasis on the value of the loyal customer and recognising that, in this environment, even a slight improvement in customer satisfaction can have a considerable impact on a company's bottom line.
Three major factors determine policyholder satisfaction after a property claim: speed of service, claims transparency and settlement accuracy. Claims technology can help insurance companies meet and exceed customers' expectations for these key indicators, starting with the first notification of loss.
First notification is critical because it sets the pace for the policyholder's overall experience. Modern claims management systems streamline the process by integrating call centre and claims management systems and quickly capturing essential information. Systems can also help set and track company standards. For example, if a company sets a goal to contact the policyholder within 24 hours, the system can send the initial assignment immediately after the claim is reported, then send an alert if the standard is not being met.
This helps other team members and managers solve issues before they become problems and a system can be flexible enough to recognise when a customer is on holiday or prefers to meet later. Other tools help loss adjusters quickly determine the cost of repairs and pave the way for speedy repair. Simultaneously, these tools can help improve customer satisfaction, while also helping reduce claims handling costs.
Many policyholders feel vulnerable following a loss, and skilled claims professionals understand that communication and transparency are central to a policyholder's peace of mind. Claims management technology facilitates instantaneous communication among all stakeholders, including insurers, adjusters, service providers and policyholders to provide status updates and keep assignments and services on track.
Fast friendly reporting
Insurers can now provide more transparency than ever before, with tools that can be used to quickly sketch detailed floor plans and calculate replacement costs. User-friendly reports for policyholders that explain proposed repair work and itemise materials, labour and plant costs provide a clear view of the work needed. Open communications and detailed easy-to-understand information can significantly improve policyholder satisfaction.
No amount of technology, skill, training or experience can compensate for errant rates. Repair costs often change quickly and it is simply unrealistic for any estimator to be completely up-to-date with the latest market fluctuations for all items that can affect construction rates. Many insurance professionals have turned to comprehensive, independently researched rate schedules that not only arm estimators with the latest cost information but also give them the flexibility to use their own knowledge and to adjust rates to on-site conditions.
These rates help eliminate overpayments, which do surprisingly little to enhance customer satisfaction. They also help eliminate underpayments, which are usually caught eventually — but often only after the chance for a good customer experience has passed.
Policyholders' experience during the claims journey determines loyalty and what they say to family, friends and acquaintances. A recent study revealed that the use of social media in the UK grew by 159% in the last year alone. Your customers are talking; technology can help make sure you like what they have to say.
James Grant is manager of European sales at Xactware
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