Insuring the future...

... Donna Baker discusses how our customers of the future can help us to support the policyholders of today

Donna Baker“We talk a lot about vulnerable customers in the insurance industry, and while we may all have a view as to what constitutes a vulnerable customer, and there is no doubt that these groups should absolutely be carefully and compassionately supported throughout the insurance process, there is a slightly less obvious category of vulnerable customers that has been highlighted by research carried out by the Financial Conduct Authority. 

Their findings suggest that one in seven adults in the UK has literary skills equivalent to that of a child aged eleven or younger; that means a significant proportion of our customers who can take out an insurance policy with the risk they may not fully understand or engage with the policy documentation they receive.  Think about the terms we use – many of them can sound like jargon, especially when the ‘real-world’ meaning of the words can be so different to the technical meaning in an insurance context, for instance excess and premium.

All this can add up to a very confusing picture for customers, it’s little wonder the industry has gained a reputation amongst some for bamboozling its customers with small print.

Clearly something must be done to address this, not only for vulnerable customers, but our entire customer base; as an industry, we need to make it simpler for them to engage with their policy, understand exactly what they’ve bought and make it easier for them to make a claim when the worst happens.

It’s important to understand which parts of a policy can prove tricky for customers.  To get a better idea of how people might engage with a policy, we turned to our customers of the future, a group of willing eleven to thirteen year olds.  Using interactive and fun focus group sessions we drilled down into what the children liked and disliked, understood and misunderstood about our policy documents.  The result was uniquely insightful and delivered with the honesty that only a child can get away with!

Our future customers

To summarise their feedback, I think it boils down to two main points; presentation and language.

“It’s like terms and conditions, nobody reads them!”  I wasn’t at all surprised to hear this, we know that typically, insurance policy documents are lengthy, and people often just don’t read them – they can be text heavy and visually unappealing which can turn customers off from the start. We need customers to read these policy documents, and understand them.

In one of our child focus group activities, we made use of a fictional character, Mr Ian Shore (geddit?) and illustrated a few claims scenarios.  The children really engaged with the character and said they’d like to see him used more in documents; they also really liked the infographics we’ve already incorporated into our policy wordings. I think this says a lot about how people process information, preferring easily digestible representations such as infographics and illustrations that they can understand at a glance, rather than long paragraphs of text.

“There’s too many big words!” The children were also confused over some of the words we typically use; excess and premium caused confusion as did words like subsidence, malicious damage and, felling, lopping and topping, which one of the children thought sounded like “something an Oompa Loompa might sing!”  I think sometimes we forget that in day to day life, some people just don’t come across such terms and, as such, may have to reach for a dictionary when interpreting their policy – this does not make for a good customer experience.

So what can we do as an industry?

Perhaps a good place to start is to put aside preconceived ideas of what an insurance document “should” look like and step into the customer’s shoes. We need to try and understand what they might be thinking, feeling and understanding when they first look at their policy documents.  Policy documents are important so need to be easy and simple to digest and understand for our customers. Is there an overwhelming bombardment of text? Are we using ten words when one will do? Are terms really clearly defined and easy to interpret? Would infographics and images add clarity?  Here’s a thought …. Do we even need text documents or could we use short videos?

If we start with the premise that not all customers are the same, and that they all have different needs, there’s a much stronger chance we will create something that truly addresses their needs and is fair to all customers.”




Notes to Editors:

About Covéa Insurance

Covea Insurance plc is the UK underwriting business of leading French mutual insurance group Covéa, who are number 1 for property and liability insurance in France, generating over 16.3 billion Euros in premiums in 2017.  

Covéa Insurance looks after the insurance needs of over 1.5 million policyholders; delivering financial reassurance through its Standard & Poor’s A+ stable rating, as a guaranteed subsidiary of Covéa. 

The company offers motor, household, protection, pet, mid and high net worth insurance and a range of commercial insurance products, through a range of distribution channels. Employing over 1800 people, Covéa Insurance has a strong people and service ethos, having Investors In People Gold accreditation and is signatory to the HM Treasury Women In Finance Charter. It also has World Class service accreditation from the Institute of Customer Service for its Motor Claims, Home Claims and Underwriting Services teams as well as Chartered Insurer status for its Commercial and Mid/High Net Worth business.

In 2018, Covéa Insurance were recipients of the Personal Lines Insurer of the Year award at both the British Insurance Awards and the Insurance Times Awards and was the top rated insurer in the Insurance Times Broker Service Survey for both Personal and Commercial Lines.

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