It’s a simple step that the life insurance industry is missing and it comes at the expense of client satisfaction and loyalty
Communication plays a critical role in client satisfaction with individual life carriers, yet at least 17% of customers who purchased through an agent or financial advisor have never had another interaction with their insurer since their initial purchase.
A recent JD Power 2015 Household Insurance Study measuring individual life insurance customer satisfaction shows that when insurers are able to effectively communicate the value customers receive relative to what they pay, even customers who pay a higher premium are more satisfied and less likely to shop for a new policy with a competing insurer.
Which is unfortunate, says Rocco Casullo, the head of direct to consumer insurance for BMO Insurance, as client needs are constantly changing, which should open a door for advisors to keep the conversation going on insurance.
“As life changes, insurance needs change as well,” Casullo told LHP. “It’s important to educate your clients about the products that will provide the most benefits for them at their particular stage in life. There are plenty of online resources available, making it easier than ever to research the insurance options that are available.”
And the client wants to learn more, as 46% of individual life insurance customers told J.D. Power that they don't have a complete understanding of their policy.
“Most of the insurers know that communication is important, but they just aren't doing it,” said Valerie Monet, director of the insurance practice at JD Power. “Customer interaction requires a financial commitment from insurers, and they need to see the return on their investment. Interaction can offset a higher price when customers focus their attention on the value of their policy.”
The study finds that 37% of individual life insurance customers have evaluated their life insurance needs, including the relevance of their current product, in the past two years. Yet, nearly one in five customers who purchase through an agent or financial advisor has never had another interaction with them since their initial policy purchase.
Among customers who shopped for a new policy in the past two years, 40% ultimately upgraded or purchased a new policy from their current insurer, while another 12% purchased a new policy with another.
A recent JD Power 2015 Household Insurance Study measuring individual life insurance customer satisfaction shows that when insurers are able to effectively communicate the value customers receive relative to what they pay, even customers who pay a higher premium are more satisfied and less likely to shop for a new policy with a competing insurer.
Which is unfortunate, says Rocco Casullo, the head of direct to consumer insurance for BMO Insurance, as client needs are constantly changing, which should open a door for advisors to keep the conversation going on insurance.
“As life changes, insurance needs change as well,” Casullo told LHP. “It’s important to educate your clients about the products that will provide the most benefits for them at their particular stage in life. There are plenty of online resources available, making it easier than ever to research the insurance options that are available.”
And the client wants to learn more, as 46% of individual life insurance customers told J.D. Power that they don't have a complete understanding of their policy.
“Most of the insurers know that communication is important, but they just aren't doing it,” said Valerie Monet, director of the insurance practice at JD Power. “Customer interaction requires a financial commitment from insurers, and they need to see the return on their investment. Interaction can offset a higher price when customers focus their attention on the value of their policy.”
The study finds that 37% of individual life insurance customers have evaluated their life insurance needs, including the relevance of their current product, in the past two years. Yet, nearly one in five customers who purchase through an agent or financial advisor has never had another interaction with them since their initial policy purchase.
Among customers who shopped for a new policy in the past two years, 40% ultimately upgraded or purchased a new policy from their current insurer, while another 12% purchased a new policy with another.
