Insurance providers are essential for almost everyone, but small insurance companies have to work hard to compete with the much bigger firms out there. While beating them on price may not be possible for a lot of smaller businesses, there is one approach that can allow them to get on equal footing: improving their customer service. Here, we’re going to look at some of the ways that small insurers can do more for their customers and thus end up with a much more loyal customer base.

How Small Insurers Can Do More For Their Customers

Insurance providers are essential for almost everyone, but small insurance companies have to work hard to compete with the much bigger firms out there. While beating them on price may not be possible for a lot of smaller businesses, there is one approach that can allow them to get on equal footing: improving their customer service. Here, we’re going to look at some of the ways that small insurers can do more for their customers and thus end up with a much more loyal customer base.

Get a better understanding of your customer

Being able to speak to the needs of the customer and to help them overcome the obstacles specific to their lives. You can’t help your customers if you don’t understand them. Market segmentation can be even more important in the insurance world, where you want to be able to market to and speak to customers with different needs for different levels of customers. As such, you should make sure that you’re gathering market research on your customers. This means not just their demographics, but the average customer journey, including specific demands and the moments where they are likely to convert or even to stop being a customer. This understanding can make it a lot easier to establish the customer engagement you need.

Utilize customer data in your decision making

Beyond research, you should get customers more open to the idea of sharing what data they can with you. Gathering customer data can allow you to, for instance, better offer personalized insurance policies that are specific to the needs of the customer. However, many customers have some understandable reservations when it comes to the idea of passing personal data onto insurers. As such, you have to make sure that you can build their trust that it will be used only for the most relevant insurance reasons and that you do not have any intentions to sell or pass it on to third parties (unless those third parties are part of how you provide your services.) 

Provide clarity in pricing

One of the most important things to insurance customers, and one of the things that they are so frequently denied, is clarity in pricing. Providing clear pricing in your policies is important, but it’s also important to let customers know where that pricing is coming from and to be able to break down what is affecting their price. This is largely going to be determined by risk factors, but you should also be quick to let them know about what extra value they might be getting for their money from more expensive policies, as well. Otherwise, customers are not going to trust that they are getting the best possible deal that you can offer them.

Give yourself more time for customer-oriented work

One of the things that keeps small businesses back from spending the time and energy needed to create a great connection with their customers is the fact that the bulk of their time has to be spent on other labor. In the insurance industry, this is often the process of calculating and writing risk. As such, there are tools such as insurance underwriting software that can automate much of the process for you. While it still requires some human supervision to make sure that the results are correct, it can take away a lot of the monotonous labor you might be spending your time on, allowing you to better focus on keeping customers happy.

Use analytics beyond risk

The insurance industry uses analytics with customer data all the time to be able to better provide them with specific insurance policies related to their needs. However, you should be using analytics to improve much more than just your insurance offerings. You can also use data to improve marketing, to improve website design, and how the customer experiences your services. This way, you are able to rely less on the assumptions (as well quantified as they are) made through market research and being to mold your services to better match the needs of the customers are demonstrated through the data that you are able to collect from them. Behavioral economics is another way that analytics can be used to offer products with better timing, which can directly affect your bottom line, too.

Take complaints with an open mind

It’s not uncommon for any business owner’s reaction to criticism to be defensive. You’re worried about protecting your business’s image, so you might think to deny or rebuke criticism. However, the insurance industry doesn’t have the greatest reputation as it is, and work needs to be done to rehabilitate your company’s public perception even before you’re dealing with customers. Listening to complaints and responding to criticism with improvements and insight can actually help you improve the reputation of your business, rather than damaging it. Look at tips on how to deal with negative criticism and try to use them as learning opportunities. If you can handle a complaint well, you can turn a critic into a loyal customer and, even if not, it demonstrates your attentiveness to customer needs to others.

Make customer service easier to access

One of the big problems with insurance companies, especially the big ones, is that they don’t make customer support and service channels accessible in the first place. Look at your customer effort score, which is an idea of how much energy a customer has to expend in order to get help with a problem in the first place. The more friction they experience, the more likely they are to have a much worse reaction to their issue. Even small problems can get blown up into major rifts if a customer has a hard time addressing it. Make sure that you have the right customer support channels to keep friction to a minimum.

Let them serve themselves

While a lot of businesses are offering a more “personal touch” and that is all well and good, you have to acknowledge that, most of the time, a customer would rather be able to sort out their problems themselves without any interjections. As such, you can make sure that you have support resources that customers can search through to solve their most common problem. Making sure that these channels are easy to navigate and provide the most commonly sought information first is going to help lighten the load on your customer support channels while helping savvy customers get the help they need without needing to interact with someone.

But make sure there is a human option

That said, you cannot automate everything. You are going to need real humans on the end of one or more of your support channels, ready to help. To that end, you should make sure that you have enough customer support workers on deck at any given time, and consider investing in training to help them better manage customer complaints and redirect conversations towards the solutions they can use to help them. You have to invest in your customer support workers, equipping them with the right tools and compensation to make up for what is a stressful role that often does not get the respect or the pay that is deserves in the first place.

Aside from creating a more loyal customer base, being there for your customers more readily is also going to see your word of mouth improve drastically. You might not have the advertising budget to compete with the biggest companies, but word of mouth can be even more effective.

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