How to Redo Your Strategy to Hook & Book Your Customers in the Insurance Industry

All insurance companies have certain specific growth goals, however, the strings of these goals are connected with the insurance customers. It is for sure that more are the customers, more will be the business growth. But that does not mean insurance companies start focusing on customer acquisition only.

Yes, insurance companies need to acquire customers, but retention of the existing customers is more important. Statistics show that the average insurance customer retention rate is 84% these days.

Why customer retention has become a headache for the insurance business industry? The reason is the persistent increase in the cost of acquiring customers. Previously, customers used to be loyal to insurance companies. Now, the trends are changing. Customers demand usability of the product that they purchase and most insurance products do not start delivering the usability instantly.

So, here we are to help you redo your insurance customer retention strategy so that you can hook customers for a long time.

Also Read: The Impact of Subscription Automation on the Future of Insurance

Offer Better Insurance Products

As has been mentioned that the focus of the customer is more on the usability of the product for which they pay. And to make your insurance products attractive to insurance customers, you need to offer insurance through better channels. For instance, in the insurance industry, middlemen or brokers used to have a significant role in bringing new customers and locking the deals. However, insurance companies can try to be direct with the customers to save resources and build a relationship of trust with their customers.

Also, you need to focus on demographics to offer better insurance products. These days, insurance companies are more focused on Gen Y and millennials. People of these generations are more interested in investing in insurance policies rather than Gen Z. Young people are interested in the modern means of earning. They are investing in bitcoins etc.

So, insurance companies need to offer their insurance plans and products accordingly. They need to re-evaluate the market and the customer behaviour as well. If they really want to cater to even Gen Z, then they need to come up with something really attractive. But to add this attraction, a huge cost will be required which is already a constraint for the entire insurance business industry.

Also Read: Lessons to Learn from Churned Customers for Improved Customer Retention

Customer Segmentation

We have mentioned above, it is not easy to convince Gen Z of insurance policies. However, Gen Y or millennials are happy customers of insurance companies. So, you need to segment the customers so that you have a better chance to acquire customers and retain them. As an insurance policyholder, it is not only important, but it is your job to know:

  • Your prospects
  • Your active customers
  • Churned Customers
  • Price-sensitive customers
  • Service-sensitive customers
  • And more

This segmentation of the customers will also depend on the niche of customers to whom your insurance company cater. Also, just like any other business, insurance companies need to market their insurance policies and plans. To market these plans, insurance companies need to know their customers well. For that customer segmentation is mandatory.

Referral Programs

In order to retain insurance customers, you must have a referral program. You can either go for paid referrals or unpaid referrals. However, sometimes the laws of a state restrict insurance companies to go for paid referrals. So, when you work on our referral program, consider the state laws as well. Also, you can offer gifts, discounts, or other perks per referral. No matter how you go with your referral program, your referrals should be visible to the customers.

Customers believe in other customers and the word of mouth more than any marketer or advertisement that you run to bring more customers on board. So, for customer retention in insurance industry, you need to have a perfect referral program and its visibility as well.

Better Communication

Communication is the backbone of the insurance business. You cannot acquire more customers if you don’t have people in your team who are good at communication. You need to communicate with the insurance customers when you need them to be on board. You need to communicate with them when the customers are planning to churn.

It is suggested by the experts to conduct annual or semiannual goodwill communications with the existing customers. You can also conduct surveys about your customer base. You can even use automated tools to conduct these surveys. The findings of these surveys show how to deal with the customers

The point is you need to feed value to the customers.

Multi-Line Insurance Contract

Today, customers do not take a minute to cancel their insurance plan once they feel that the usability of the insurance product that you offer does not satisfy them. Businesses are willing and in the position to compensate their customers, but to even compensate the customers, they need time and a chance that the customer is not willing to give.

So, it is better to bring your insurance customers to the multi-line insurance contract. The multi-line insurance contract is one that is a bundle of different insurance products. When the customer is bound in a relationship where he has invested with the insurance company in different programs, it is difficult to just leave. Also, customers are aware of what they are signing for. Multi-line insurance contracts increase the overall retention of insurance customers.

Also Read: RetentionFlow Rescue—Focus on Churn Score Calculation to Prevent Revenue Leaks

Proactive Approach for Involuntary Churn

To put it simply, involuntary churn means customers leave because of some technical issue not because of their own will. For instance, the customers try to pay through certain payment methods but cannot. The causes of payment through the card can be varying i.e. card cancellation, card failure, card limit etc.

If payment is cancelled because of such a reason, then he is not responsible rather the system is responsible. Automated payment processing systems for insurance companies cancel the plan of the customer simply if the payment is not done in time. Here, you need to act proactively. Communicate with such customers on a priority basis so that they may not turn to be churned customers. Help them in paying their insurance fee as per their plan. Also, compensate in some way so that the customer feels like staying with you.

By opting for the strategies mentioned in this blog, insurance companies can hook their customers for a long time. Insurers can manage their insurance plans through our subscription management platform. SubscriptinFlow is one such subscription handling software that can be opted for insurance customer retention for a long time.