INSURERS need to offer broader related services to differentiate themselves in the marketplace and to increase interaction with customers - a way to earn greater loyalty, a survey has found.
Based on research released by consultancy Bain & Company, the study says insurers should branch out into providing related products and services, such as vehicle anti-theft services, health advice and even estate planning, to boost traditionally low rates of customer engagement and loyalty.
In health coverage, for example, carriers are exploring arrangements with preferred networks to implement telemedicine solutions that reduce the average cost of claims, thanks to earlier exits from hospital and remote monitoring of patient health data, said Hashveer Singh, a partner in Bain's financial services practice in Asia-Pacific.
He noted that Ping An, a large Chinese carrier, has built a connected health platform that now has 77 million registered users and more than 50,000 doctors.
The survey, conducted on 164,000 consumers in 19 countries, including 4,000 from Singapore, found that in Singapore, 60 per cent of property and casualty (P&C) customers and 50 per cent of life insurance customers had interaction with their primary insurance provider in the past 12 months.
Those who did have interaction had a significantly higher loyalty score than those who did not (up 26 per cent in P&C and up 35 per cent in life insurance).
Mr Singh said in mature markets of the Americas and Europe, interaction levels were even lower.
The report said insurers need to improve cross-selling, which can generate significant value.
"We've seen some of the barriers to cross-selling falling in recent years," said Mr Singh, adding that the vast amount of customer data and greater computing power to analyse this data make it feasible to learn more about customers, and thus allow insurers to create more compelling value propositions and target with more precise offers at the most opportune time.
"Insurers can use a variety of tactics. Some are relatively basic, such as adding a sales component to inbound calls, freeing up time for agents to actually sell or offering online diagnostic tools that show consumers how to optimise their coverage," he said.
Those who took a needs-based approach and who focused on building relationships with clients also gained considerable advantages than those who did not.
Insurers also need to fix the basics and accelerate the mobile channel to create satisfied customers, particularly for claims, said the survey.
To master the customer switching game, insurers can refine their marketing campaigns to be more selective in choosing clients, use advanced analytics to improve consideration among less price-sensitive segments or build predictive models to improve customer retention, the report said.
The findings are part of Bain's second biennial insurance loyalty study conducted with Research Now.