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Insurance offers the worst customer experience, according to new insurance research. Why are UK SMEs getting such a poor deal and what can be done?
Service design consultancy Engine’s latest annual Customer Experience Survey compared 14 major industry sectors. Just 11% of respondents rated the insurance customer experience, followed by automotive and utilities (both 12%). The retail sector has the best customer experience (38%).
Insurance suffers two key problems in terms of customer experience, says Oliver King, co-founder of Engine. “It’s a product people are obliged to have rather than want. Plus, on the rare occasions they do interact with the provider, it normally has negative connotations.”
But some insurers may retort that customers in their industry are less influenced by quality of service and customer experience. In fact, the survey data does bear this out to some degree: insurance ranks eleventh (16%) of consumers’ choice of provider being influenced by experience, against fourth (26%) for banking and first for food services/ restaurants (cited by 35%).
Such a stance is short sighted: the same research shows that openness/honesty is the most valued trait in the provision of customer service and experience (49% of respondents), followed by efficiency (43%) and reliability (41%). All three of the most valued traits become a bigger factor with age – particularly openness/honesty.
“Insurers can’t afford to think about what’s important to their ‘average customer’ – that person doesn’t exist,” notes King.
This is even more evident in the SMEs, he adds, as smaller businesses in many sectors, not just insurance, are often under-served because service providers have tended to divide their efforts squarely between corporates and consumers.
“The SME economy continues to grow and the hybrid needs of SMEs now represent a great opportunity for insurers. SMEs need the product modularity and the absolute certainty expected by corporates, as well as the simplicity and immediacy expected by consumers. Unlike consumers and corporates, SMEs need insurers to recognise the pace and fragility of smaller businesses and see flexibility, understanding and direct access to a person who can help, as vital. Most importantly, SMEs don’t have the admin resources of larger businesses – owner-managed businesses feel this most acutely. Both self-serve business products and high-touch personal service are appealing.”
Not all SMEs share the same values when it comes to buying business products and services, King says. “Our research on SMEs buying a range of business products and employee benefits has revealed three broad attitudinal segments: those that will always buy in price, those that are looking for a partner that can support them in delivering their business objectives, and those that will pay more for great service because they see the value in removing the burden of administration from their business – they’ll pay never to have to worry again.”
Find out more about Engine at enginegroup.co.uk
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