Average Claims Experience Not Enough to Retain Customers: Accenture

Although a large majority (86 percent) of home and auto insurance customers who have submitted a claim in the past two years are satisfied with how it was handled, 41 percent of those who have submitted a claim are still likely or very likely to switch to another insurer in the next 12 months, according to new global research by Accenture.

Fourteen percent of insurance customers who have submitted a claim in the past two years are dissatisfied with the way it was handled, and 83 percent of these dissatisfied customers are planning to switch or have already switched to another insurer, according to the survey.

“While a customer who is dissatisfied with the way his or her claim was handled is almost certain to defect, a satisfied customer will not necessarily remain loyal,” said Michael Costonis, a managing director in Accenture’s Insurance Industry practice and global head of Claims Services. “The survey results clearly show that delivering average claims satisfaction levels is not enough.”

The research also explored speed of settlement and process transparency, the willingness of customers to share personal information for benefits, and customers’ use of social media in sharing information on how claims were handled.

The survey also reveals that customers who have submitted an insurance claim in the past two years are almost twice as likely to switch insurers in the next 12 months compared to those who have not submitted a claim: 41 percent compared to 22 percent.

“The very act of filing a claim makes a customer much more likely to switch insurers, regardless of how satisfied they are with the experience,” Costonis said. “Insurers should look at how connected devices and other digital technologies can help customers better manage risks to reduce claims frequency.”

The research is based on a survey of nearly 8,000 automobile and home insurance customers in 14 countries.

Customers Information Sharing

The survey also indicates that more than three-quarters (77 percent) of insurance customers would be willing to share personal information with their insurers in return for certain benefits. While 77 percent of these respondents would share information if that would enable them to receive lower insurance premiums, more than half (59 percent) would do it for quicker claims settlement, and 28 percent for personalized recommendations that could help them better manage risk and avoid losses.

When asked what types of information they would be willing to share, more than half (56 percent) of the automobile insurance customers surveyed said they would share information about the condition of their cars, 52 percent about their driving habits and 39 percent about their location via global positioning system (GPS).

As to home insurance, 78 percent of customers surveyed said they would share information collected by smoke, carbon monoxide, humidity or motion detectors, and more than one-third (35 percent) said they would share security video camera footage.

Speed, Transparency, Customer Loyalty

The survey findings also suggest that speed of settlement and process transparency are the most important contributors to customer loyalty, with each cited by 94 percent of survey participants as a key expectation when interacting with insurers during the claims process. Additionally, 90 percent of respondents cited the ability to contact the provider at any time to check real-time status of a claim as an important expectation.

Almost two-thirds (61 percent) of insurance customers said they would prefer to use digital channels to check the status of their claims. Half (53 percent) said they would not recommend their insurers to friends and family if they did not have the ability to use digital channels to interact with these insurers, and more than two-fifths (44 percent) said they would switch to another insurer if they could not use these channels.

Social media is another area with growing influence on customer perceptions. Approximately one-in-three (29 percent) of respondents say they post or plan to post on social media channels about their positive claims experience, and a similar number (30 percent) say they post or plan to post about their negative claims experience.

Accenture surveyed 7,875 insurance policyholders online in the month of May. Forty percent of the respondents had submitted an auto or household insurance claim in the previous two years.

Topics Carriers Claims