LIMRA and the LIFE Foundation reported in concurrence with September's Life Insurance Awareness Month that three in 10 American households are underinsured. But there is some good news for the beleaguered industry: it excels at providing a differentiated, personalized experience for its current customers, which helps it retain the customers it does have.
Accenture's recently released global consumer survey ranked life insurance against nine other industries on several customer retention metrics. What it found was that life insurers tend to do a good job retaining their customers, with only gas and electric utilities and landline phone companies losing fewer customers to other providers. (And life insurance isn't even a regional monopoly!)
In addition, life insurers ranked only behind travel and tourism providers and retail bankers in "providing tailored experiences." That means that life insurers are doing a good job using the data they have to provide their policyholders with unique, personalized interactions that consumers value.
Like other insurance lines, there's a lot of opportunity for life insurers to compete by using the wealth of data they have on each policyholder to provide an exemplary customer experience. In fact, PwC identified "Information advantage through 'big data'" as one of four technology-powered strategies life insurers can use to compete for future customers.
"Increased processing power and smarter analytics will pave the way for more informed prevention, risk selection and premium pricing, allowing your business to offer cheaper and more personalised products, while still sustaining margins," the consultancy wrote.