Real Price of Being an Insurance Customer

The real price of anything is the toil and trouble of acquiring it.” — Adam Smith

An insurance company is a portfolio of functional departments replete with skilled professionals providing a spectrum of services to get-and-keep customers. Unfortunately, few insurers manage most service activities or the entire spectrum of services from the one critically important perspective: the perspective of the customer.

Who in an insurance company “walks in their customers shoes”? Who understands the challenges customers face when purchasing insurance, when requiring service, or when experiencing a loss event and requiring some level of restoration? Who is the “customer’s commissioner” that is responsible for the customer’s point-of-view for all the possible interactions between the customer and insurance company, and throughout the insurer’s ecosystems?

Many insurers (I hope) have customer relationship management systems (CRM), systems of engagement (SoE), or a detailed customer journey. Do these or similar customer-centric systems result in an understanding of the perils and pains of the customer experience from the customer’s perspective? Or do these systems merely represent another task to be completed or, as our international colleagues might say, another box to be ticked?

Every insurance professional, regardless of their functional expertise, should be asked to understand what customers regard as the real price of owning insurance. The price is much higher than adherence to customer-centric principles, glazing at CRM systems, putting notations marking the paths of a customer journey taken and yet to be taken, or ticking boxes, any of which offer fleeting — and not well-deserved — self-congratulations of supporting customers.

Owning Insurance Is a Multi-Relationship Endeavor for Customers

Owning insurance for a customer encompasses being impacted by the actual application process — including its associated underwriting, pricing and policy delivery components — but also administrative service, billing service and potentially claims service. Getting these services fulfilled sometimes requires a customer to contact people in the insurance home office, field office, insurance agency/broker firms, third party claim adjudication firms, and at times a mixture of people in all these firms and others (auto repair shops, home/property remediation firms, or healthcare rehabilitation firms) to resolve one service request.

From the perspective of a customer purchasing insurance or consuming service associated with an insurance policy, it is not a one-to-one relationship but rather a one-to-many relationship. In some situations, whether personal or commercial lines insurance, it is a matter of one-to-many-to-many relationships.

Four Resources Customers Need to Own Insurance

The truth is that the real price customers pay to conduct insurance commerce, inclusive of consuming services, is not just an outflow of premium payments but an investment of four resources: time; infrastructure; knowledge; and documentation. All four resources must be easily, and at times quickly, available at the time of interaction with insurance professionals.

Some of the particulars of each resource are time, infrastructure, knowledge and documentation.

Time. This includes the time to identify who to talk to about a request. The time to schedule appointments. The time discussing issues surrounding the policy application or submitted claim. The time to request administrative service such as the time to discuss a billing problem. The time to track the progress of a policy application or submitted claim. And the time to ensure a final resolution has been reached whether about the policy application being accepted or when the claim will be paid.

Note that after some degree of normalcy has been achieved after the COVID-19 virus has been resolved by vaccine or treatment, customers also must invest the time to drive to an agent’s office or invest the time to meet with a claim adjudicator, auto repair shop, property remediation firm, or healthcare provider depending on the claim situation.

Infrastructure. This includes a customer having the requisite wired or wireless connectivity to the insurance firm, agency, claim adjuster, or other participant if communications are to be done using computers or mobile devices rather than using telephones, postal mail, or delivery services.

This also includes the appropriate devices that can support the communication pathways with the insurance firm or the other participants involved before, during and after the policy application, administrative service, billing or claim processes. It also encompasses the ability to access and download the mobile apps (and their updates) that the insurance firm or other participants support to initiate and complete the insurance commerce processes.

Knowledge. This includes the knowledge the customer needs to use the mobile app (or set of apps) to conduct commerce with the insurance firm or other participants in the commerce process.

This also includes access to the app on the insurance firm portal or the portal of other participants in the commerce process, and, when applicable, use of the insurance firm’s, agent’s or claim adjuster’s web conferencing/communication workspace (i.e. Microsoft Teams, WebEx, Zoom, GoToMeeting, Salesforce Slack or Chatter).

Documentation. This includes, depending on the insurance commerce situation, having easily and quickly available: the policy number; the claims forms; the claim number; an account number (for a bank account that the claim amount will be deposited); and the agent’s or claim adjuster’s name, phone number, email address, and IM availability (system used, for example, to get and respond to IMs).

Customers also need to access documentation easily and quickly to interact with any of the participants of the insurer’s ecosystems who are involved with settling the claim including restoring the customer to a pre-loss event state.

In summary, having each of these four resources and the applicable components of each resource, is the real price customers pay to conduct insurance commerce. This psychological price can be more than whatever premium the customer pays for the insurance contract.