Selling insurance is not easy. For customers, insurance falls under the category of grudge purchases. Things they buy because they feel they have too; because they’d feel guilty if they didn’t, even if they would rather spend money on something else. Most customers would rather never have to use their insurance policy at all.
To make matters worse, insurance companies are often seen as being untrustworthy by individual consumers. Movies and other popular media are partially to blame for this. Failed insurance claims are used as plot points in movies often enough to make them seem like the rule, rather than the exception.
The reality is just the opposite. If you run an insurance company, you know you are paying your client’s claims way more often than not. But how do you convince your prospective clients that this is the case? That’s the problem we will be examining today. Here are a few things you and your company can do. It all comes down to how you treat and inform the public.
Address the elephant in the room
Clear communication is clear in any form of customer service. Your team should be well trained and supervised to make sure every customer is well treated and has their needs met in the most pain-free way possible.
On top of that, it also pays to address the elephant in the room whenever new clients come through the door or call. Often you can defuse their worries by just acknowledging the negative stereotypes associated with insurance companies. Explain to your client all the reasons why what they see in movies won’t happen to them.
It also helps to give worried clients clear instructions on how they can make sure their claims will get paid if something happens. Giving them a sense of agency will do wonders to reduce their anxiety.
Disclose your statistics
Numbers are a good way to gain a client’s trust. You can improve your company’s relationship with your customers by disclosing both your payout rates and the most common reasons why claims are denied.
The latter is very important. You don’t want your customers thinking that whether or not they’ll be paid comes down to luck; they must be made aware that as long as they stick to the terms of the insurance policy, they will be paid 100% of the time.
Make your pricing clear
Giving your customer options is a good idea, but it can backfire. Customers are already primed towards mistrusting insurance companies, and if they are confronted with dozens of different options where the differences in costs and benefits aren’t clear, there is a risk they will assume something shady is going on.
It’s better to give only two or three options; or better yet, let your clients get a free insurance quote directly from your website.
Explain your business model.
The financial services industry (which includes insurance companies) was ranked the least trusted industry world-wide. That’s according to the Edelman Trust Barometer, which in 2018 found that only 54% of consumers trust the industry.
Part of the reason behind that mistrust is that people have a hard time grasping how said companies generate value and where their profits come from. Your clients may be under the impression, for example, that insurance companies can only be profitable if they fight tooth and nail to deny as many claims as possible.
A clear headed explanation of how insurance companies make money — through risk assessment, premiums, and investments — is a good way to put customer fears at ease. Make them see how your company’s interests align with their interests. It’s a matter of informing your clients, which can be done through your customer service channels, as well as your website, company blog and social media channels.
Investing in trust and clear communication pays off in the long run. Just because the whole financial sector is widely mistrusted, it doesn’t mean your company has to be.