Retaining policyholders with real personalization: 3 ways to make digital interactions feel human

Almost one-third of insurance customers will churn after just one negative experience. You can only do so much to differentiate insurance products from competitors… at least not without racing to the bottom of the barrel on price. 

What you can do, however, is offer a standout customer experience on your digital channels. A whopping 88% of customers say the experience a company provides is as important as its products or services—the highest it’s ever been.

In this post, we’re digging into three key ingredients to help ensure your policyholders feel like valued individuals rather than faceless numbers—so they’ll actually stick around.

Let’s jump in!

Why empathetic interactions are critical to your policyholders’ digital customer experience

Insurance shoppers are just like any other customer. They expect seamless, personalized experiences whenever they interact with a brand online. The issue is that companies and consumers often have different ideas of what a personalized digital experience looks like. Chew on this:

• 62% of customers would switch FSI providers if they felt like they were treated like a number

• 53% of customers would switch FSI providers if service felt impersonal

• 85% of brands believe they offer a personalized customer experience, but only 60% of consumers agree.

• 50% of insurance customers place a high priority on personalized digital communications, while only 17% of insurers currently prioritize personalization.

In a way, this gap is understandable. Digital personalization can mean anything from slapping a policyholder’s name on a welcome email to extensively tailored policy recommendations based on one person’s historical interactions.

Building digital customer journeys around empathetic interactions helps ensure policyholders feel their individual needs are recognized and accommodated at every stage, from onboarding to claim submissions, policy upgrades to account maintenance.

In practice, this means:

1. Relevant offers

Cross-sells and upsells are seamlessly integrated into policyholders’ interactions. They receive the right offer, on the right channel, at the right time—predicted by their actual behavior, instead of broader demographic segments or renewal dates.

Just think about companies like Amazon, which earns 35% of its revenue from cross-selling and upselling. In addition to incorporating related products on every product page (“customers also bought”), Amazon delivers hyper-personalized product recommendations based on real-time customer behavior.

While shopping for an insurance policy isn’t quite as straightforward as dog treats or a new Stanley tumbler, that doesn’t mean you should shy away from showcasing additional offerings.

In fact, 79% of policy buyers are open to personalized coverage recommendations. With the right data, insurers can automatically predict which products are the best fit for individual customers by analyzing their behavior at different stages and identifying commonalities with satisfied policyholders.

2. Value-added recommendations

Policyholders actively benefit from their interactions with your brand—and not just when they’re filing a claim. Beyond product recommendations, 45% of insurance customers are interested in rewards programs related to their health and activity levels, and 42% are interested in tools for managing financial needs. When a downturn forces consumers to look more critically at their spending, relevant, thoughtful and personalized recommendations only increase the value they can derive from their plans—and make policies feel more human.

3. Proactive communication

Policyholders are promptly informed of any changes to their account—no one wants to learn about rate hikes from a bank statement.

Although there’s a direct correlation between pricing and customer satisfaction, the fallout can also be mitigated with simple communication. In 2022, auto insurance customers who were notified about a price increase in advance averaged 37 more points in overall satisfaction scores than those who weren’t.

Back to you

It’s impossible to build lasting relationships if policyholders feel like faceless numbers. Think beyond product- or segment-based personalization and drill into the actual touchpoints at every stage of the customer journey. Combining relevant offers and value-driven recommendations with proactive, transparent communication not only enhances the overall customer experience, but makes digital interactions actually feel human.