Four Ways that Insurance Companies Can Ensure Their Reputation Stays Strong in 2020 and Beyond
The insurance industry has a hard-earned reputation as a sturdy, reliable, and steady beacon in often turbulent economic and commercial environments. True to character, the industry as a whole entered 2020 with a stable Reputation Score, only slightly behind the overall Financial sector by one Reputation Point.
Despite the widespread uncertainty from the ongoing COVID-19 pandemic and recession, there are some clear steps that insurers can take to build on this enviable starting point: A continued emphasis on company character, a renewed focus on meeting customer expectations, a broad-based approach to innovation, and a forward-thinking strategy to attract a younger workforce.
Let’s look at four ways that your insurance company can bolster its reputation in 2020.
1. Continue doing and saying the right things during the pandemic
Like their counterparts in so many other industries, insurance companies have gone above and beyond to assist the public during the coronavirus pandemic. Many insurers have credited auto premiums for April and May to reward a sheltering public for staying off the roads. Others are suspending late fees and policy cancellations due to nonpayment of premiums—a lifeline for laid-off and furloughed workers.
These actions together have sent exactly the right message to the public: Honesty, empathy, and humility.
Our recent research during the pandemic has found that this is exactly what the public expects and appreciates, and what they will continue to associate with your company’s brand. Because your brand communications and public reception make up 40% of your Reputation Score, this may offer lasting goodwill for years to come.
2. Focus on customer experience
Think of customer experience (CX) not only in terms of products and services, but also as one of your greatest reputation assets. Companies’ reputation scores are already 10 points higher among customers, on average, compared with non-customers, and scores are 12 to 15 points higher, on average, on critical measures of success—factors such as “Would recommend the company,” “Would recommend products,” and “Would work for.” This means happy customers not only are repeat customers but a source of referrals as well. Focus on making your touchpoints easy and frictionless so customers can readily adopt, use, and promote your offerings.
Don’t wait for customers to tell you how to make their lives easier, though. For example, Allstate launched its Insurance Skill for Amazon’s Alexa personal digital assistant not because customers were specifically asking for it, but because customers were already using the devices. Your customers demonstrate their preferences through their daily choices; watch where they’re headed, and then meet them there.
3. Broaden your innovation efforts
Our research has shown that while Innovation accounts for 14% of a company’s Reputation Score in the broader Financial sector, it is consistently among the lowest-scoring Drivers for global insurers. Only 5% of the 131 global insurance companies we measured at the start of the year had “excellent” scores; 60% were “average” and 35% were “weak.”
Part of the problem may be that in recent years, “innovation” has become synonymous with new product development. Yet innovation sometimes involves adapting your existing products and services to meet your customers’ changing requirements and expectations.
Take USAA, for example. In 2017, it began hiring 1,000 technology professionals back, and partnered with Google Cloud to let customers upload claim information. Innovation at USAA “is about enabling our businesses to keep pace with member expectations while maintaining the level of service our members deserve,” Sean Burgess, SVP and GM for Claims at USAA, told Forbeslast year.
Nor should you wait to innovate: Most insurers quickly followed the lead of Allstate’s recent “Shelter-in-Place Payback” program, which provided customers with auto premium credits during the early months of the coronavirus pandemic, but by being first, Allstate received the most recognition for it. (In the U.K., Admiral received the same advantage for being first to market.) Being a close follower simply doesn’t pay the same kind of dividends that it used to.
4. Attract a next-generation workforce
Insurers can expect significant employee turnover as baby boomers (who made up 25% of the industry’s workforce in 2018) continue to reach retirement age. But with only 4% of millennials saying they’re interested in a career in the insurance industry, companies soon will find themselves facing a major talent gap.
Shift your focus from simply filling open roles to redefining these roles. The industry’s ongoing digital transformation will provide more jobs that are well-suited to this younger cohort, but more will be necessary to attract top-notch workers.
Younger consumers and employees alike place a high value on corporate integrity and governance. As the pandemic fades, insurance companies should extend their laudable efforts to environmental and societal issues that complement their overall purpose and that will cement their reputation as good corporate citizens.
There is plenty of reason to be positive: Our research suggests that millennials may gravitate toward insurers’ history of longevity, strong growth, and ability to weather economic storms. This stability may prove the perfect antidote to the chaotic world that millennials have known for most of their lives.
Keep your eye on the future
While the path of the ongoing pandemic and the growing recession remain difficult to predict, the path for insurers to enhance their reputation is clear: Understand and live your company’s purpose, and consistently communicate it through honest and empathetic actions and words alike.
Continue to monitor your company’s Reputation Score to see how the public responds to your innovative approaches, and adapt accordingly. With this new, forward-thinking mentality, the insurance industry can further burnish its already solid reputation for long-term success and stability.
Martin Lieberman Director, Content Marketing The RepTrak Company email@example.com