Digital has made it easier for Canada’s property and casualty insurance industry to serve customers who wish to purchase a fairly straightforward insurance product, but more emphasis needs to be placed on converting customers who are kicking the tires on more complex insurance purchases, says a P&C industry exec.
Specifically, the industry needs to be more proactive about engaging customers at the time when they are making choices and have questions about the insurance product, CAA chief insurance officer Nathan LaFayette said Tuesday during the webinar Insurance 2021: The Customer Behaviour Changes that will Stay.
LaFayette used the analogy of a grocery store purchase to explain.
“You have to be there for the customer when they are asking, when they are curious, about the product,” he said. “The insurance industry has traditionally put the people at the check-out. What we need to do as an industry is put the people right there [in the grocery store aisle] when the person is kicking the tire — inquiring about a limit on their condo, for example, or whatever it is on their mind.
“Don’t try and say, ‘Hey you’re a family in the suburbs, this is [the insurance product] you need.’ You say, ‘Welcome, look around and explore, kick tires, and we’re here for you if you have questions.’ [When they’re making] their purchasing decision, they just need that little nudge to say, ‘You know what? You’ve understood everything correctly and you’re good to go,’ or ‘You might want to think about this.’ Let them think about it and then they go pay.
“If you’re waiting until that final [payment/checkout] stage to insert yourself and put your people into the equation then, it’s too late. They’ve either committed to the wrong thing, or they’ve dropped off because they couldn’t figure it out.”
Webinar moderator Bryan Falchuk, managing partner of Insurance Evolution Partners, suggested that insurers also need to be engaged earlier in the process so that they can better understand their customers’ thinking and needs during the conversion phase.
“The only ones who make it to checkout have no meaningful feedback for you about why people aren’t buying,” as Falchuk put it. “You can’t look at all the denials or declines [from customers who] didn’t end up getting your policy or exited your sales funnel partway through. You could say: ‘Everyone loves what we’re doing.’ Yes, because the people who didn’t, didn’t stick around.”
The discussion was prompted by a question from the audience: With the current constraints on engaging with clients during lockdowns, the questioner wanted to know, do bigger, more established companies with familiar brand names have a competitive advantage over smaller companies offering more obscure products?
The reasoning here is that a consumer might be more inclined to go with a more established brand name over a lesser-known product if an insurer can’t engage as easily with a consumer during the conversion phase of an insurance purchase.
LaFayette said he didn’t see it as a question of big versus small companies, or more-established versus less-established brand names. “I see it as who’s committed to being there when the person is actually kicking the tire [before the sale].”