Failure to recognise and personalise service are the biggest weaknesses in insurers’ loyalty and customer experience programmes, according to research commissioned by Collinson.
The survey of more than 2,000 consumers revealed that just one in five (19%) felt valued because their insurer recognised and rewarded their loyalty.
Over a third (35%) said they received offers or loyalty initiatives that they would never use and 34% received too many pointless communications.
Almost a third (31%) said they received communications that were not personalised at all, and less than a quarter (24%) believe their insurer treats them like an individual, not just a number.
Despite these sentiments, only 21% of those polled intend to switch insurance providers, while 15% would switch due to a lack of personalisation.
Steve Grout (pictured), director of loyalty at Collinson, believes part of the issue is insurers’ failure to use data to understand why their customers are loyal to their organisation.
“Consumers are choice-rich and savvy and the balance of power has shifted in their favour,” he said. “They understand their worth and expect to be rewarded for their loyalty with highly relevant and personalised experiences.”
He warned that by failing to treat customers as an individual, insurers are effectively sending them into the arms of a competitor.
A separate Collinson study of financial services decision makers, conducted by Forrester Consulting, revealed that a quarter (25%) do not have a deep understanding of why their customers are loyal, yet two-thirds (66%) said improving customer loyalty and advocacy in the next 12 months is a high priority or critical business need.
The study found that less than half (45%) track and analyse the behaviour of their most loyal customers, adapting their recommendations for the next product or service accordingly.