The insurance industry is struggling to meet the expectations of 21^st Century consumers, independent research has found. In a survey of 2,005 British adults, sponsored by GMC Software, 93 per cent of consumers stated that they want more choice in how they communicate with insurers, who are failing to use available channels, from letters and telephone to email and websites.

For instance, only five percent of consumers’ insurers use mobile apps to communicate, yet 19 per cent say insurers should provide such a service; meaning demand outstrips supply by almost four times. This lack of understanding isn’t limited to communication channels: it also applies to whether to contact customers at all.  Over half of consumers have received irrelevant communications from insurance companies in the past year.

“The demands of 21^st Century consumers are changing rapidly. In an increasingly competitive market, those that can meet their customers’ desires will gain a significant advantage,” said Mike Davies, VP EMEA North at GMC Software. “Even email, which has been an accepted channel for almost two decades, is lagging behind consumers’ expectations. Insurers need to rectify this; without accurate and appropriate communication, consumers will rapidly grow frustrated and take their business elsewhere. This applies across the entire customer relationship, from initial contact to actually making a claim. Indeed, making a claim is often the moment of truth for many customers’ relationship with their insurer: the more painful the process, the more likely customers are to up and leave.”

Currently, the majority of consumers have to share information multiple times when making an insurance claim, meaning insurers aren’t sharing information as appropriate to make the process easier. Sixty two per cent of people making a claim had to share the same information twice or more the last time they did so, with 11 per cent having to share it four or more times. Consumers also want insurers to make greater use of all methods of communication, with the difference for email particularly stark: 71 per cent of people say it should be used, yet only 53 per cent’s insurers use email to communicate.

As well as more accurately targeted communications, using the right channels, consumers are also encouraging greater transparency from insurers; especially when using the data they already have to improve customer service. Eighty five per cent of consumers with insurance would like their insurer to give them insight into how they could lower their premium, for instance by suggesting changes in behaviour.

Indeed, consumers are willing to pay for this: 64 per cent would accept higher premiums now in exchange for more accurate information that would help them lower premiums over time. Forty six per cent would also pay more for the guarantee of fast, efficient claims. Consumers also encourage greater use of technology beyond simply communicating. Fifty six per cent of current insurance customers would like their insurer to use technology such as health monitors or connected cars to provide a more accurate premium.

“As we can see, consumers aren’t averse to paying a little more now for a better service that benefits both insurer and consumer,” continued Mike Davies. “By matching their customers’ expectations and making the most of technology, insurers aren’t only helping consumers, they’re helping themselves. For instance, using connected devices to provide more accurate premiums means insurers can offer cover at a lower cost and at less risk to themselves. Society’s attitude to technology and communications has changed: the industry needs to change with it.”

The study, conducted by TNS on behalf of GMC software, consisted of 2,005 GB adults aged 16 and over. *