UK insurers at all time low ie below banks

UK insurers at all time low ie below banks

UK primary insurance companies really need to work on their customer relations. A survey has found that consumers trust banks more than their insurance provider. The level of trust in insurers was also found to be lower in the UK than in any other European country, and over 50% below the global average, according to a survey from Ernst & Young. 

EY surveyed 23,595 insurance customers across 30 countries, including 800 from the UK.

If insurance marketers feel gutted by that news, Graham Handy, EY’s Global Customer Insurance Leader twisted the knife, saying: “At a time of great upheaval across the entire UK insurance industry, with the motor market reporting unprofitability, the home insurance market not far behind and dramatic changes to pensions, this news could not come at a worse time.”

Price is the key reason for switching, however. Over a quarter (26%) of UK customers surveyed claimed that they were likely to switch insurance provider in the next 12 months. Cost is the main reason, with policy benefits and coverage at a distant second and reputation and benefits barely making an impact.

EY says the UK insurance consumer is also far more driven by price than many of its international counterparts - 83% of those likely to switch stated cost as the primary reason, which is higher than the global average (67%) and other comparable markets such as the US (64%), France (60%) or Germany (72%).

 “In a price-driven market, it is very hard to differentiate service offerings, but insurers need to find the touch points which are important to customers in order to move away from bargain basement prices being the sole driver for customer decisions,” Hardy said in a statement.

Under a third of customers have interacted with their insurer in the last 18 months, according to the survey, placing the UK in last position across Europe, the Middle East and Africa in terms of customer communication, and compares with a far higher global average of 56% of customers having interacted with their insurer over the last 18 months.

UK customers actually want to receive more communication from their insurer; not just general information or policy updates, but also promotions. Over half (54%) of customers are never contacted about promotions, and 23% would like to receive them annually, the survey found.

The majority of UK insurance customers still prefer to manage their policy enquiries via the telephone, but more than 30% claimed to be open to using emerging channels, including webchats and smartphone apps. In addition, 17% of customers would like to trade physical mail and phone contact for email, demonstrating a shift towards digital interaction.

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