Canadian Underwriter

How to Give Customers What They Really Want

August 23, 2010   by Saba Taye

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Excellent customer service can help a brokerage retain its customers and attract new business.

This is because favourable word-of-mouth referrals, offered by friends, family members, and satisfied clients, are one of the biggest drivers of new business. For this reason, the most important task for any broker to accomplish is to provide the best service possible to each potential customer.

Brokerages in Canada fit into two customer service models. One model focuses on face-to-face interaction with customers; the other integrates a vast array of technology into the service model. Angela Marzolini, vice chair of Pollara Strategic Insights, a market research firm that conducts the annual insurance survey InsurPOLL, says there are challenges in each model that brokers need to be aware of.

According to Marzolini, the broker’s service value comes from providing customers with personal service and advice. She says technology is a valuable way to offer exceptional service because it can save brokers time that they can better spend advising their customers–and keeping those clients highly satisfied.

“However, trying to replace this advice with technology–for example, by replacing an annual review of customers’ coverage needs with a website checklist–is a missed opportunity to create highly satisfied customers,” Marzolini says.

Still, customer service must include technology that increases the convenience and speed of purchasing, renewing or amending a policy. Marzolini adds brokers should include telephone and online strategies for customer communication and work to accommodate customers’ schedules by offering convenient hours of operation and timely service during those hours.

In a survey conducted by Canadian Insurance and Pollara Consumer Monitor in 2009, customers said they were up to 2.2 times more likely to recommend an insurance representative or company if they received the right amount of contact.

The survey showed that customers had different opinions on what constituted excellent customer service, depending on their channel of communication.

  •  Consumers who bought insurance through a broker wanted contact from their insurance advisor up to 2.2 times a year.
  •  Consumers who bought insurance directly over the phone wanted the least amount of contact, at 1.4 times a year.
  •  If consumers benefited from changes in coverage, 81% wanted to be contacted; 15% said it wouldn’t make a difference and 2% said they would be less satisfied after contact.
  •  If a broker switches insurance companies, 77% of policyholders wanted to be contacted; 14% said they wouldn’t care either way and 6% said they’d be less satisfied.
  •  When premiums increased, 76% said they wanted a renewal notice; 17% wouldn’t care if they were contacted and 5% would be less satisfied if contacted.
  •  If premiums were not increasing, 47% of policyholders would want a renewal notice; 44% said they didn’t need a notice and 7% said they would be less satisfied.
  •  The survey results found that customer expectations weren’t being met, with only 38% of customers receiving the desired amount of contact and 42% receiving less than desired contact.
  •  Only one in five customers (20%) received adequate contact.
  •  Consumers are more likely to get coverage from an insurance company they have heard of or already know; for this reason a broker should spend over 4% of net revenue on branding recognition.
  •  Tailor your style of service and communication to each client’s needs; different people find different methods of communication effective.
  •  Focus on giving current customers excellent service; not on getting more customers.

© Copyright 2010 Rogers Publishing Ltd. This article first appeared in the June 2010 edition of Canadian Insurance Top Broker magazine.

This story was originally published by Canadian Insurance Top Broker.