Insurers and the ‘Chicken and Egg’ Dilemma of Insurance Customer Data Vs Personalization

by | Jun 28, 2021

Insurance Customers Want Value In Exchange For Their Data, But Personalization Of Products Or Pricing Is Not Possible Without In-depth Data

Based on their experiences with retailers, banks and other sectors, insurance customers place increasing value on personalization when it comes to the products, pricing, and communication they receive from their insurer. This expectation goes far beyond being addressed by name or receiving vaguely suitable offers based on broad segmentation.

Insurance customers want relevant products with personalized, usage- or behavior-based pricing; for example, if they drive less, they want to pay less for insurance cover. To achieve this kind of product personalization, the insurer must have access to personal, usage, behavioral, and other types of information in real-time.

On the other hand, consumers are increasingly aware of the risks associated with sharing their personal information and allowing companies to track their product usage or online behavior.

A recent report by Accenture concluded that: “Consumers are being pragmatic and protective with their data. They say they will share data for better value; they show no increased willingness to share data without an incentive.”

This creates a “chicken and egg” type dilemma for insurers. Customers want value in exchange for sharing data, but personalization of products or pricing is not possible without in-depth data. If gathering the required data is challenging because there is no value-based relationship with the customer, and showing value requires personalization which is based on data – where do you start?

Let’s take a deeper look into insurance customer data vs personalization and how building trust is key to solving this dilemma.

Building a relationship based on trust will encourage data sharing

Let’s face it, insurance is a grudge purchase and often leads to a conflicted relationship. Sometimes, the only communication a customer receives, outside of a claims process, is a bill and an annual policy renewal. In the absence of regular communication or valuable information from the insurer, very little goodwill is built up between insurer and customer.

To meet customer’s expectations, insurers must actively work on building trust with their policyholders, and one way to do that is through customer communication management.

Consistent, regular, and relevant communication promotes trust

A customer communications management strategy, enabled by a CCM platform, is the best way to begin building trust with customers.

Insurance customers want to hear from their insurer. They want advice and information that will assist them in managing their personal affairs more efficiently. Whether the communication is marketing or service-based, customers expect it to be highly personalized and relevant to their needs, seamless across channels and consistent in its message.

Investing in a reliable and scalable customer communication management (CCM) solution can achieve this. Not only will it improve the customer experience, but a CCM platform will be central to creating personalized communications that build up trust with the customer.

Once trust is established, the dilemma of needing access to data to personalize products and services falls away, as the customer sees the value of sharing their personal information in every communication they receive.

Building relationships requires customer communication management technology and expertise

Doxim’s experienced consultants and omnichannel CCM platform can support your CCM needs in several ways:

  • Build trust with insurance customers via communication (via print, PDF, HTML, email, text, and online interactive experiences).
  • Generate and deliver insurance policies, bills, statements, and any other customer documents via print and digital channels through a single provider.
  • Store documents securely online and enable customers to self-serve.
  • Encourage customers and brokers to adopt digital communication channels.
  • Gather and utilize customer data to continually improve the personalization of communications.

To learn more, read our white paper entitled: Insurers without a customer communication plan are at significant risk.

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Scott Biel
Scott has 25 years of experience in Customer Communications Management (CCM), with a primary focus on delivering exceptional results for the financial services industry.In his current position as VP Sales, Financial Services North America, Scott leads a team of sales executives who sell Doxim solutions to the financial services industry, including Wealth, Insurance, Banking and Credit Unions.Scott leverages his extensive knowledge of CCM, regulated and financial services to improve customer experience, drive operational effectiveness and achieve cost optimization through digital technologies.

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