Customer turnover in the insurance industry can be attributed to myriad factors. However, one that may be overlooked — and also can be corrected — is poor communication.
This is the conclusion of "EY's 2014 Americas Consumer Insurance Survey: Reimagining Customer Relationships."
Forty percent of North American consumers have changed carriers in the past 18 months. Although value for money is the primary factor in selecting a carrier, several non-monetary factors also are at work:
- Fifty-four percent of respondents reported having had no interaction with their insurer in the past 18 months, which means many insurers are not building long-term relationships and loyalty.
- Being easy to deal with (60 percent) is more important than value for money (53 percent).
- Fifty percent view insurer responsiveness as an important relationship characteristic.
- One-half of consumers who closed a policy in the last 18 months said they are likely or very likely to recommend their former insurer.
"The results of this survey should give insurers cause for concern and hope," said Kaenan Hertz, U.S. Insurance Customer Leader at Ernst & Young. "While the survey confirms industry-wide concern about customer turnover, the steps insurers need to take to improve their relationships with customers to combat this turnover are clear and achievable. In essence, insurers must take control of customer relationships and put their customers at the heart of their operations."
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