Customer Experience, Loyalty, and Retention in a Post-COVID World

The insurance industry is at an interesting crossroads since the COVID-19 pandemic. As New Jersey insurance agents, we work in an evolving landscape that must somehow balance speed and efficiency with excellent customer service, and a meticulous focus on accuracy, privacy, and security. We hate to tout the “new normal” concept. Still, we can’t deny that consumer behavior has changed thanks to COVID-19.

Today, we’ll consider these changes in client behavior and how that relates to the world of insurance — particularly how customer experience affects loyalty and retention in our industry. Let’s get started with some meaningful statistics.

Consumer Behavior Has Changed

You know the pandemic has changed how we work, learn and shop. Per Statista.com, this trend is obvious in the US. Let’s put a finer point on it.

• Internet use surged immediately in March 2019 across all devices except desktop computers. Laptops, cell phones, and tablets reign.
• While changes in state closures and stay-at-home orders throughout the year affected customer behavior, overall the internet had about a 70% increase in use.
• Social media platforms, online retailers, and the services that support them (online payment portals and shipping) saw unprecedented growth in 2020.
• Facebook memberships jumped, and as of February 2021, PayPal stock prices have risen to $250.00.

Ultimately, as insurance agents, we saw a dip in walk-in traffic and a surge in emails and phone calls. That all makes sense! Clients who once stopped in for a chat are now mailing a check, and more customers are requesting a quote via insurers’ websites.

Moving forward, insurers already know customers are spending more time at home. That’s why auto insurance rates have dropped noticeably. Fewer vehicles on the road mean fewer claims to pay. We might see similar action in the property insurance market, as restricted travel and reduced vacation time this summer translate into fewer burglaries and home fires (maybe.) Those statistics are yet to be written.

Your Clients Have More Time to Research Insurance on a Handheld Device

Agents must understand that customers have more time on their hands. Clients who have found themselves unemployed or underemployed in particular are eager to save a few dollars. And, as an intangible service, insurance is a frustrating bill to pay. It’s not like our customers can physically see or taste their insurance policy.

This leads us to reflections on customer service and the “human touch” that might make the difference in your retention rates this year, but not forever.

Is the “Human Touch” Still Needed in Insurance Sales?

Yes, for now. Speaking demographically, Millennials (they’re buying homes, business property, and life insurance policies) are the least likely to talk with an insurance agent on the phone or in person.

• Most Millennials prefer to do their research and make their purchases via a laptop or handheld device.

Boomers, on the other hand, are retiring en masse. The generation that placed so much value on personal relationships in business is buying less insurance. They’ve sold the family business, their children and grandchildren are grown, they’ve downsized the home, and they may only need one vehicle. All of this was happening regardless of COVID-19! The pandemic only served to quicken early retirements.

It all begs the question: How can we earn customer loyalty / maintain retention when we don’t speak to customers in person? Well, we’re still learning about that. But here are some starting points:

• Reach out to your customers by phone and introduce yourself to new customers that bought policies online. Even if you cannot speak to them in person, try to humanize the transaction. They’ll be more likely to reach out to you for questions about their policy and refer others.
• Monitor their payments. It’s awkward to contact a client when their premium is late, but most will value your attention to detail, and you won’t lose the policy over a missed payment.
• Be active on social media. Your current and future customers are spending a lot of time on it. You don’t need to be “salesy,” just be helpful.

Finally, broadcast a helpful message to your target market. A radio spot about financial scams affecting seniors could go a long way towards establishing your reputation locally among Boomers, for instance.

We hope you’ve enjoyed our dissertation on customer experience, loyalty, and retention post-pandemic. We enjoyed writing it! If you have any other questions about insurance and customer interactions in 2021, contact us.