March 07, 2014

The insurance industry continues to struggle to keep pace with changing policyholder expectations in an increasingly consumer-centric business world. Today's policyholders expect communications to be both personalized and efficiently delivered. However, it's often difficult for many insurers to meet this demand.

Mark Breading, SMA
Mark Breading, SMA

"The thing about insurance is that there aren't that many interactions with customers," explains Mark Breading, a partner with analyst firm SMA. Because those interactions tend to be concentrated around "moments of truth" such as claims or beneficiary changes, it's essential that insurers re-evaluate their customer communications management (CCM) strategies to ensure that they are making each interaction count. That's the key to attracting and retaining a loyal policyholder base.

"Communication is starting to become more of a differentiator and seen as an aspect of service," says Scott Draeger, customer communications strategist for GMC Software.

Though efficiency has always been a priority for CCM -- a body of tools that facilitate streamlined communications between insurers and their customers -- today's insurers must also engage their policyholders and provide the personalized level of service they have come to expect. "People are receiving more and more of their communications in an online manner," says Tom Clayton, HP Exstream's insurance industry specialist. "Now, customers are demanding more communications to be delivered in a format that they want."

Effective customer loyalty is the result of many different factors, but CCM strategy and practices have the biggest impact, says SMA's Breading. One inaccurate document won't drive away a customer, but a series of erratic communications is sure to have a negative impact on loyalty. The key to boosting loyalty and retention is personalized, consistent, and engaging content that is both visually appealing and serves as an accurate representation of the brand.

"Think about it from a customer standpoint: [The insurer] knows who I am, they understand my needs, they tailor their communications for me, they know how I want to receive communications," says Breading. "I think a modern CCM system can clearly influence customer loyalty, but only if insurers are using it to the extent that they can."

[To hear about how insurance companies and financial firms are managing their complex data architectures, attend the Future of the Financial Services Data Center panel at Interop 2014 in Las Vegas, March 31-April 4.
You can also REGISTER FOR INTEROP HERE.]