What does the study say?

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Over the last year, Ipsos notes, there’s been a decrease in the amount of communication between consumers and their insurance providers.

Even before the pandemic, the insurance industry didn’t focus on offering omnichannel options for its customers, relying on old-fashioned methods of communication.

But COVID has revealed that customers expect a streamlined claims process with shorter wait times. And long-term insurance customers need more from their insurance providers.

Going forward, Ipsos says it’s clear that in order to differentiate themselves, insurers need to think about how they can fit into a consumer’s life, rather than the other way around.

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What are insurers doing wrong?

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Consumers are particularly unhappy with the level of communication they get from their insurers — fewer than 25% reported they were satisfied on that front.

But it goes deeper than simply being unsatisfied, as good customers who’ve held their policies for a long time feel out of touch with their providers.

This isn’t exactly a new issue.

The insurance sector on the whole, compared to other industries, has always had low customer engagement and the pandemic has only made this worse for those offering travel and auto insurance as Canadians have stuck close to home.

Buying life insurance presents a particularly acute illustration of consumer frustration.

In a survey for PolicyAdvisor, a Toronto-based life insurance startup, 44% respondents said they plan to buy life insurance because of the COVID pandemic. But 30% say not being able to purchase coverage online has held them back — with another 23% reporting the process seems too complex.

“The life insurance industry unfortunately has not kept pace with the times,” says PolicyAdvisor’s CEO Jiten Puri. “It continues to be such a black box.”

“Just trying to uncover what product, what price, which company you should consider seems like a particularly difficult and complex process for consumers,” he says. “And then — last but not least — it seems to take forever. ”

How to get the best experience from your insurance provider

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But not all insurance providers are failing to impress their customers. Some even made it to the top rankings of the Ipsos survey.

Those who rated well seem to have found a balance between affordable premiums, variety, accessibility and creating emotional bonds with their clients.

But that’s rare: Only about 9% of insured customers felt their providers offered something innovative.

So what’s holding those other insurers back? Puri says providers have simply taken their finger off the pulse, having convinced themselves the consumer still wants to meet face-to-face.

“The industry has been in some form of inertia,” he says. “It hasn’t recognized that the consumer’s desire to interact and engage with insurance products has completely changed — the consumer has gone online.”

Digital life insurance providers like Puri's aim to rectify that.

The new firms use algorithm technology to scans through reams of products and related documents in order to offer customers data-backed recommendations on policies — and to do it quickly, without the need for face-to-face meetings.

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Where to go from there

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Setting yourself up with an affordable life insurance policy will ensure your family is financially protected if anything ever happens to you.

But there are a few other steps you’ll want to take to make their foundation as strong as possible:

  • Create a will. Especially if you’re homeowner, setting up a will and testament will make sure your family is taken care of and provided for when you’re not around to protect them anymore.

  • Earn a little extra money on the side. If your budget is tight, download a rewards program that offers you cold hard cash back in exchange for all the purchases you make at participating retailers.

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About the Author

Sigrid Forberg

Sigrid Forberg

Reporter

Sigrid is a reporter with MoneyWise. Before joining the team, she worked for a B2B publication in the hardware and home improvement industry and ran an internal employee magazine for the federal government. As a graduate of the Carleton University Journalism program, she takes pride in telling informative, engaging and compelling stories.

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The content provided on MoneyWise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.