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A snapshot: As we speak's automobile insurance coverage buyer

Today’s car insurance customers are both savvy and highly motivated to protect their property. Millennials aren’t buying houses at the same rate as Baby Boomers, so cars are often their most significant financial investment. In fact, 95% of survey respondents – with an average age of 33 – stated that their car is their first or second-largest asset—so it’s really important.

Today’s customers are also responsible. They don’t want car insurance just because it’s required—they also want it because it offers vital protection for themselves and for others. Millennials are 10% more likely than other generations to say that they purchase car insurance because they want financial support for the other party in the event of an accident.

Put simply: Millennials have high expectations of themselves and their insurance. It stands to reason they’ll be on the lookout for an insurer with equally high standards.

Customers aren’t ready to go fully digital

The biggest surprise of our survey? There’s not much interest in an all-digital insurance product. Instead, 90% of survey respondents stated that they’d prefer a hybrid insurance product that blended both human and digital elements. 

Customers know exactly where they want the digital experience to get better, too. An overwhelming majority of respondents (76%) stated that they want digital improvements to make the purchase process easier and insurance policies that are accessible via mobile phone. In addition, 70% said that payment processing should be digitized. 

Still, while survey respondents were very open to digital improvements, the overall picture is clear—don’t go full chatbot yet. When push comes to shove, most customers still want the option to talk with a real person.

Three key takeaways for the auto insurance industry

 

  • Stop focusing on brand recognition and make a better product instead

Despite massive advertising spend on brand recognition, almost 9 out of 10 drivers would consider dropping their car insurance company if they found a better product at a better price. That’s a wake-up call to insurers. In the long run, brand loyalty is worth more than brand recognition. The best And the way to earn loyalty? Make an affordable, high-quality product using modern technology. We believe insurance should be a seamless part of customers’ lives that lives behind the scenes, versus something that frequently demands their attention – a commodity that’s already in short supply.

  • Make it easy for consumers to understand their insurance policy

It’s sobering that the new generation of insurance customers assumes that auto insurers intentionally make policies difficult to understand. As an industry, we need to do better. (We take this especially seriously at Clearcover, and we have some new features rolling out later this year to ensure our customers know exactly what they’re buying and how we’ll take care of them if they get in an accident.)

  • Be tech-friendly—but don’t get rid of the human element

Our data was pretty clear: Millennials want their car insurance to be simple, convenient, and understandable, but they don’t want convenience at the expense of human interaction. So we need to be smart and strategic about implementing technology—and, most importantly, make sure that our digital solutions never get in the way of providing personal, human-to-human customer service.


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