7 ways to get closer to your customers - TIA Technology A/S ?· White Paper 7 Ways to get closer to…

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  • White Paper 7 Ways to get closer to your customers

    Closer to Customers

    Closer to Customers

    7 ways to get closer to your customers

    White Paper

  • White Paper 7 Ways to get closer to your customers

    Closer to Customers

    Closer to Customers

    Page 2 of 22

    Contents

    Introduction: Whatever your business strategy focuses on, make sure it is customer-centric 3

    1. Create a platform for engagement that fuels dialog with your customers 5

    Dont be a stranger 5

    Two critical factors for engagement 5

    2. Improve customer satisfaction by optimizing your claims processes 8

    Your customers moment of truth 8

    How to balance fraud management with prompt claims settlement 8

    3. Give your front-line people the information they need to get more out of customer interactions 11

    Why your customers think you dont really care 11

    A 360 customer view helps you score business goals 11

    4. Get a clear view of individual risks and profitability in order to offer more benefits to the customers 13

    An offer they cant refuse 13

    5. Meet the customer where the customer is (different channels for different steps in the Insurance Value Chain) 15

    Your customers do business digitally, do you? 15

    How do you meet your customers where they are? 15

    6. Offer the customer the right product configuration quickly 17

    One eye on the customer and one on the competition 17

    From months to days 17

    An example: When products become differentiators 17

    7. Give your customers a role in your pricing strategy 19

    Put your customers to work for you 19

    An active role 19

    An innovative example: Name your price 19

    About the authors 21

    About Tia Technology 22

    TIA Technology A/S Bredevej 2DK-2830 Virum T +45 7022 7620 F +45 7022 7621 W tiatechnology.comE marketing@tia.dk

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    Introduction: Whatever your business strategy focuses on, make sure it is customer-centric

    Why you need a customer-centric strategyMaintaining good relationships with an insurance customer is like raising a baby. Their behavior changes rapidly. You simply cannot ignore their needs, and the way you deal with them affects the health of the entire family or in the case of your business the health of its bottom line.

    The insurance industry has the highest new customer acquisition costs of any industry.1 Whats more, customers buying behavior is changing, and they are not necessarily loyal. Today, 53% will compare offers (often using social media to shop around and purchase via the web or a mobile phone). There is no doubt that this lack of loyalty is expensive. Insurers lose around 20 percent of their customers each year, resulting for example, in over 4 billion euro of losses in the private motor and home insurance markets.2 On the other hand, a 1% increase in customer retention can increase annual premiums by close to 800,000 euro.3

    Your interactions with customers are critical to meeting your business objectives. Regardless of whether your strategy focuses on distribution and customer service, operational excellence or product optimization, your customers need to be in focus.

    1 Rough Notes magazine, 20122 Accenture survey, 20113 Insurancetech.com, 2012

    Sales/Customer

    Service

    Operational Excellence

    Product OptimizationCustomers

  • White Paper 7 Ways to get closer to your customers

    Closer to Customers

    Closer to Customers

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    In this whitepaper, we take you through seven ways to get closer to customers. Each section covers the challenges you face, the changes you need to make in your organization and the benefits you will derive. We also link those benefits to overall business objectives.

    In some cases, we draw your attention to how an insurance solution can support these changes. Examples and screenshots from the TIA solution are used. This is to make it more clear and concrete for you. Yes, we work for TIA, and we believe that our solution has some unique benefits, especially when it comes to customer-centricity. Nevertheless, the principles in this white paper can be used independent of any given technology or solution.

    We hope you get a lot out of it, and wed love to hear from you with feedback or questions. You can write us at marketing@tia.dk

    Steen Vingaard Larsen, Business Advisory Director at TIA Phone: +45 24943605

    Martin J. Ernst, Business Consulting Director at TIA Phone: +45 29911122

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    1. Create a platform for engagement that fuels dialog with your customers

    Dont be a strangerIf your company is like most insurance companies, you do not have many points of contact with your customers. In fact, you may only engage in dialog in a claims situation or in connection with annual or renewal payments and those interactions do not relate to the needs of the customer. So, if you are communicating with your customer infrequently (and often in situations the customer per-ceives as negative), how can you anticipate their needs and keep them satisfied?

    The answer is to engage in a much more frequent and relevant dialog with your customers in order to learn their needs and respond promptly. That is all very well and fine, you say, but how do I in-crease the number of opportunities to engage in dialog?

    Two critical factors for engagementThere are two key actions you can take to create contact points and engage with your customers: customer milestones and incentives. A prerequisite to these two actions is accurate and accessible customer data. Customer data is used to identify milestones, trigger an action and offer the cus-tomer an incentive for engaging in dialog.

    1. MilestonesIf you have the right customer data in your system, you can identify critical points in the customer lifecycle. These are milestones where a need may present itself a need that can be answered in the way of information, advice, and ultimately, a concrete offer. Examples of these critical points are when the customer moves away from his or her childhood home, gets a driving license, moves or travels abroad for a longer period, marries or moves in with a partner, has children, gets divorced or loses a spouse. Each of these milestones represents an opportunity to engage. A similar lifecycle approach can be applied to commercial customers by identifying company milestones that trigger different insurance needs and advice.

    2. IncentivesThe dialog you initiate must offer the customer a clear benefit. Otherwise, you can attempt to en-gage all you want, but you wont get a response. On the simplest level, this benefit could be nothing more than advice. It will, however, only be perceived as a benefit if the customers feel that they are getting impartial advice. Naturally, they are aware that the person they are talking to represents an insurance company and, at the end of the day, wants to sell them something. Nevertheless, the tone of the conversation can be crucial. If your people recognize that this is an early point in the sales cycle, and the customer feels that they are getting help rather than being sold to, it could make a big difference in the ultimate outcome.

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    Closer to Customers

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    A prerequisite: Customer dataIn order to engage, an insurance solution that stores the relevant data and makes it accessible when required is needed. This solution should make it possible to store the right customer data across functional areas and to set up certain actions that will be triggered by the system. For example, when the customers child approaches the age when they begin to learn how to drive (a milestone), you could engage in dialog regarding their car insurance policy. This could be in the form of an email, letter or telephone call. Whats more, when the initial contact is personalized based on the data in your system, it has a greater chance for success.

    A customer-centric solution makes it easier to handle the entire customer lifecycle and the entire value chain. It provides insight that frees resources to focus on business development.

    Innovation: An interesting example of how to encourage ongoing dialogThe benefit you offer when a customer has a milestone can be much more than giving advice. It could come in the form of the offer itself. This could be a traditional time-limited offer, for example. It could, however, also be of a more innovative nature one which promotes ongoing dialog. For example, the Ingenie insurance company offers a product for drivers in the age group of 17-25.

    They install what they call the Telematics box in the customers car (at no extra cost). The Telemat-ics box automatically assesses the customers driving trends. The customer goes about their normal driving habits with no special rules or restrictions, and they receive regular feedback. The cost of insurance is reviewed every three months, thus opening up for ongoing dialog. The incentive is that if they drive well, customers could pay less.

    Customer

    Task Management

    Risk & Investment

    Customer & Policy Servicing

    Claims Management

    Collection & Disbursement

    Marketing/ Segmentation

    Sales & Underwriting

    Product Definition (product variants)

    Business Process Management

    Sales & Marketing

    Business Utilities

    Performance Management

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