Life insurance customers want to receive more communication from their providers –and this presents important opportunities for insurers to improve relationships and build business with customers and intermediaries alike, according to Bill Gilbert, executive director of the Riverside Group, a provider of customer marketing programmes for insurance companies.

Compared with other types of business, insurance companies – and especially life insurers communicate very rarely with their customers after a policy has been sold.

There are various potential reasons for this:

  • The “new business” number is still often seen as the most important indicator of success – with cross sales, upgrades and retention having less focus
  • Remuneration of management and the sales operation sometimes gives greater emphasis to customer acquisition, than to retention and development
  • Some life insurers simply don’t have the in-house resource needed to develop and manage effective customer communications
  • Life companies are concerned that direct communication to their customers could alienate their intermediaries
  • There is a view that customers do not want to receive communications from their insurance company – or even that such communication could prompt policy lapses

The fact is, however, that customers are keen to hear more from their life insurers – amply demonstrated in an Insurance Consumer Survey from EY, across 24,000 consumers in 30 countries.

This survey concluded: Consumers want more frequent, meaningful and personalised communication from their insurance providers”.

What’s more, it isn’t only customers who are demanding more and better communication.

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Life insurance regulators around the world are increasingly keen to ensure that customers are kept aware of the terms and benefits of the products they hold.

So, improving the frequency and quality of customer communications is an important route to better business for the life insurance industry globally.

Swiss Re recently conducted a year-long study with an insurer, comparing the lapse rates of two groups of customers.

The first group (the “control” group) received no regular communication over the year.

The second group (the “test” group”) received regular communication reinforcing the value of their cover.

The retention rates of the “test” group were 4.2% higher than those of the “control” group – further clear evidence that relevant and regular communication improves customer loyalty for insurance companies.


Reinforce value

It’s especially important for life insurers to develop effective communications with their customers, because – with protection products in particular – the product itself provides few “built in” opportunities to reinforce value.

In fact, many protection customers and their families never hear anything from their insurer for years on end – other than in the event of a claim.

We always recommend that our insurer clients fully and openly explain the planned communication activity to their intermediaries – and also offer every intermediary the option to exclude any or all of their customers from the activity if they wish.

However, very few intermediaries choose to exclude their customers.

After all, communication that improves customer satisfaction and retention is obviously of great value to the intermediaries also.

In addition, there are other benefits that we find intermediaries welcome and appreciate:


  • If the communication offers additional cover, the intermediary can earn additional sales commission for little additional effort
  • The insurer can provide the intermediary with a full list of customers included in the communication – which they can follow up as they wish – to secure additional policy sales
  • Relevant communications often generate additional inbound leads from customers
  • These can help the intermediaries identify the best timing for high-value sales propositions both immediately and in the future

Nowadays, consumers in the digital world are demanding immediate digital access to information on all their financial products – including insurance.

Increasingly, they are looking to the insurance company directly for this access, rather than encountering potential delays and the complexity of going through a third party with every information request.

This trend is also positive for intermediaries, as it frees them to focus on the areas in which they can add most value, such as detailed financial planning and personalised customer care.

Success in the future will go to insurers and intermediaries who work together to deliver the relevant and timely information and communications that customers undoubtedly want – and now increasingly demand.